The Startup
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The Startup

Asking for money as a freelancer

Photo by Vladimir Solomyani on Unsplash

Money is the most awkward subject when you first start out as a freelancer. Probably you’ve got a huge dose of impostor syndrome, and some of the figures you’re wanting to ask for don’t even seem reasonable to you. How do you charge what you’re worth?

To illustrate my points, I’m going to use the example of after school tuition, since it’s quite a simple business model. If your child is struggling with a school subject, you might hire someone for a couple of hours a week to go through their lessons with them, help them understand their homework, work through mock exam papers and so on.

I used to do this when I was a student, and back then the going rate for a student was £15/hour. If you wanted to hire a qualified teacher, you’d pay £25/hour. I got these figures by going through Gumtree (like Craigslist if you’re more familiar) and looking at all the ads of my competitors, as well as doing a bunch of research on Google.

The first step is figuring out what you offer and what the going rate is. For my example, it’s fairly straightforward as there are basically only two “grades” and it appeared it was pretty standard what people charged — I’m not a qualified teacher, so £15/hour it is. Be honest with yourself about your skills and qualifications here, and consult a range of sources to figure out what the going rate is. Don’t just go with the highest figure you see, and pay attention to reasons why you might not be able to charge as much, such as you live in a different city, or you’re not as qualified.

The second step is convincing yourself to be confident in whatever you decided in step 1. If you didn’t knowingly inflate your hourly rate in the previous step, it’ll be easier to develop confidence here. For my example, I was confident that I deserved the going rate, because I got As in both the subjects I was offering tuition in and was studying them both in university. I also knew that it would be a bit of a stretch to claim I was worth extra, but probably unfair to charge less: I hadn’t actually done private tuition before, but I’d done paired reading and other mentoring in school.

You might want to be prepared to defend your rate a little, at least in your own head. Perhaps there’s extra work that the client doesn’t realise is involved, or equipment you have to buy. In the end though, it’s just the market rate, and you shouldn’t get too defensive or try to justify it too much. That’s where you can lean on your research and reassure yourself that other people doing the same service charge a similar amount, and they get customers.

What if a client doesn’t want to pay the market rate?

Firstly, they might not realise what the going rate is. In this case, you would explain to them what the service you’re offering is, how you’re relevantly qualified and experienced, and how the rate you’re offering is what other people are charging.

It could be that you’re not the person they want after all. If a parent wants tuition for their child, but they only want to pay £15/hour, well, they’ll be in the market for a student, not a qualified teacher.

If you’re a qualified teacher, and they’ve decided a student will do, you’ve probably lost the gig, and while that sucks, it would do more harm to your business to do it for £15/hour anyway. By doing so, you’re blocking up time you could be charging out for £25, and you’re affecting your self esteem and confidence. You’ll probably also low-key resent the client by the end of the job.

If you hold fast on the price, and confidently explain to the client what they’re getting for their money, they might realise that they do indeed want that extra level. If you don’t win them over, you could direct them towards a service more within their budget. In doing so, you demonstrate that you’re useful to them, are confident in your service, and are doing well enough to turn business down. They might later decide that they want to upgrade to your services, or they might refer a deeper-pocketed friend.

There are other ways to meet the client’s budget without selling yourself short or referring their business away. Let’s say you’re offering to do 2 hours a week for £15 an hour, and the client says “I only want to pay you £10 an hour” — the obvious thing would be to offer to do say an hour and a half, which gets closer to their apparent budget of £20/week.

Possibly they’ll continue to insist that they only want to pay you £10/hour regardless of how many hours you do. Someone people just have difficulty with the notion of paying over a certain amount per hour, and they can’t help but compare it to what they get as an hourly rate in a full time job (with sick pay and holidays, training, a desk, etc).

It might help to reframe the conversation in terms of the benefit or value they are receiving for the money. A useful way to think about it is what is the client buying versus what are they paying for. In the example, the client is buying “a tutor for 2 hours a week”, but they’re paying to increase their child’s confidence in the subject, and hopefully improve their exam prospects. So you need to get away from talking about being a tutor for 2 hours a week, and towards how tutoring will help their child — that’s what the parent is actually ready to part with cash for.

Another thing you can do is offer the client a “trial” of sorts to build their confidence: offer a short term initial contract, with a defined deliverable, so that they can see the value they’re paying for. You might say “I’m confident I can increase your child’s confidence with maths inside 4 weeks”. A 4 week block is a less scary thing to commit to, and it gives the client a mental “out”. It’s important of course that the target is really achievable to make sure you’ll hit it.

Eventually there comes a point when you realise: the client just might not value what you do. This kind of client is just not worth it. If you do somehow manage to forge a deal, you’ll likely be working for much less than you want, and they will be constantly suspicious and difficult to work with. I’ve also found that when someone doesn’t value other people’s time, it is often because they are a control freak, and they value only their own time. Working for a control freak will be all-consuming, and leave you less able to find more work to replace theirs, leaving you even more dependent on them. Avoid at all costs!

Most freelancers, even those who are confident in their worth, are still a little flexible. If you like the client, and the job is useful to you (e.g., it would look good on your portfolio, it’s the first job of that kind you’ve done, it’s just plain fun etc), then by all means offer a discount, but try to get your full price first. It’s tempting when you see a job you really want to do to go in with a low price to avoid “putting them off”. But the difference between your market price and the lowest price you’d consider working for shouldn’t be so great that starting at the higher price would shut down all conversation forever. Again, confidence helps here, because you have to believe that there are things they will like about you beyond the price.

Finally, if you just have to offer a discount to get some work in to pay the bills, always make it time limited. Don’t just agree to work for someone at 80% of your rate, agree to do a month or two at 80%. By the time you come to renew your contract, hopefully you’ll have either found someone else to pay you more, or the client will have realised how good you are and agree to pay you more themselves.

Asking for money gets easier with practice. But you can get off to a good start by defining your service and qualifications, researching your market, and becoming confident in what you offer. Prefer flexibility in the size of the job over what you charge, and if you do discount, set clear limits.

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Stewart Everett

Stewart Everett

32 year-old Glasgow-born creative, figuring out life one day at a time — ♡ cats, coffee, hops

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