Advice For Freelancers To Ask For And Justify Rate Increases

Everyone loves a bargain. But what if you’re the bargain? What if someone’s buying your services at a steal?

If you’re a freelancer who exchanges your time and intelligence for money, and you think it’s time to earn more, then keep reading. In this article, I’ll explore some advice — via a bunch of hypothetical Q&As — for raising your rates.

Q: How much should you raise your rates?

Find the sweet spot between what you’re worth and what the market will pay. That’s, of course, a hard number to figure out.

Sometimes you’ll be able to find accurate data about average hourly and project rates, but sometimes you won’t. Also, it’s difficult to determine what you should charge when different levels of job experience mean different things to different people.

When deciding upon your rate, know that what you think you’re worth is different from the lowest rate you’re willing to work for (sometimes called your minimum acceptable rate).

Q: What are some situations that might justify asking for a raise?

Here are a few:

• For the past few months, your responsibilities have increased, but your rate hasn’t.
• Your operating or overhead costs have gone up.
• You’ve improved your skills in an area and want to provide that service.

Q: How can you help prove that you deserve a raise?

Consider trying to identify what value you bring to your client, including:

• How you made or saved your client money.
• How you improved your client’s customer service, web content, etc.

Q: What if you dread conversations about money?

If you have some barriers that prevent you asking for money, then welcome to the club. It’s a common problem.

One approach is to identify a topic that’s not about money and which you dislike talking about — but which you still eventually get around to discussing. Maybe it’s talking about vacations or in-laws. Whatever it is, identify the turning points you reach when you finally decide it’s OK to talk about it, then try to apply that same principle to talking about money with your clients.

Q: What if you think now’s not the right time?

Many of you probably want a pay raise and think you deserve one. If it’s timing that’s preventing you from asking for a raise, then maybe you need to let go of the idea that there’s a perfect time to ask for one. Of course, some people will tell you that timing is everything. But if you’ve taken that advice to heart and still not acted, then it’s time for a change.

Consider setting a specific date for when you’re going to do it. Tomorrow? Next week?

Q: What if you think your higher rates will price you out of jobs?

Your increased rates might make you unattractive to some clients. But do you really want those clients? Do you want to work for those who would, in your opinion, underpay you?

Before you answer these questions, remember that client retention is often easier and cheaper than client acquisition.

Q: If you’re on the phone with a client, what phrases can kick-start a money conversation?

Consider saying something like:

• I’d like to talk about money. But first I’d like to tell you about some of the things I’ve achieved working for you . . .
• I think we have slightly different ideas about my value to your company. I’d like to discuss this with you . . .
• I’ve freelanced for you for ____ months. I’ve learned a lot. I definitely want to keep working for you. However, I’d like to . . .
• I’d like to discuss something with you that will hopefully be beneficial for both of us . . .

Q: What if you think you don’t have adequate negotiation skills?

Well, then, improve them! Consider taking a course on negotiation.

Q: What if you don’t want to charge your existing clients more?

Before you email all of your employers about your rates going up, be aware of the risks. Just because you think you’re worth a few more dollars doesn’t mean that others will too. Indeed, there’s a risk that increasing your rates for existing clients might motivate them to stop being your clients. You might also scare off new clients. Weigh the pros and cons of this decision before making it.

Q: What’s one way to effectively communicate how you’re charging different clients different rates?

Consider establishing a tiered approach with different “packages.” For instance, you could offer bronze, silver, and gold packages, each with a different level of service and, of course, different rates.

Q: What’s one way to earn more money without raising rates?

In many professions, people work overtime without earning extra pay. While this may be standard for some full-time employees on salary, it’s a different story if you’re a freelancer.

If a substantial amount of your work goes unbilled, ask yourself if that’s sustainable. If it’s preventing you from doing paid work, consider adopting a policy of doing only the bare minimum of free work.

Getting the rate you deserve

We all know that quality and price are often a trade-off. There are exceptions, yet only rarely can you buy something of the highest quality at the lowest price.

With this in mind, maybe the best advice relates to quality. Do you think you’re providing a high-quality service? If so, then surely shouldn’t you charge an equally high price?

By Lee Bob Black.