You are ready to get your first client. Your website is up, you have your contract in hand and you’re ready to roll. You have your first potential client contact you and what is the first thing they ask? “What are your rates?”
Setting hourly freelance rates is a hard thing to do. Set them too low and you will be back to working 9-5 before you know it. Or, your potential client may wonder if you may not have the skills to charge a higher rate. Set them too high and you will send potential clients running the other direction.
How do you figure it all out? Things can get complicated considering you need to cover all of your expenses, personal admin time, vacation days, etc. There is a great calculator available on All Freelance Writing. Though the site targets freelance writers, the calculator can be used for any hourly service provider.
Now check around and see what your industry standard hourly rates are. In the Virtual Assistant industry, our hourly rates range from $25 to well over $70 per hour based on the specialty. If you are just starting out, you may need to start on the lower end until you build your brand and have some testimonials. If your numbers are a little off, do you need to cut some costs to be competitive? Take a few less days’ vacation?
Taking it to the Client
Be confident when giving your potential client your pricing sheet. You ARE worth it, and if you don’t believe neither it will they. If they balk at your rates, refer them to an RFP system in your field and move on. The people that value the service that you provide are going to be ready and willing to pay you what you are worth, provided you have the necessary skills and experience to get the job done. Have some testimonials or a portfolio ready to go if needed.
In the end, the client will get what they pay for. And it is not your job to change their current line of thinking. If you take a long-term client for less than what you need and know you are worth, the relationship is likely to disintegrate fast. This may give your client a negative impression about your industry. You also don’t want to turn around in two months and tell them you need to double your rate to level the playing field with the rest of your clients.
Be True to Yourself and Your Industry
In addition to the above reasons for aligning your rates with industry standards, you want to stay true to yourself and your industry. If you try to compete with $2-an-hour freelancers, you will become nothing more than an “Eternally Starving Freelancer.” You aren’t going to be happy. You won’t be turning out quality work. You are going to be working around the clock trying to make ends meet. Not a good situation knowing at the end of the day the best piece of work you have ever churned out just made you $2 before expenses.
Also, becoming known in your online industry for low-balling the competition is NOT a good thing. The referral system among online businesses can make or break your business. If you aren’t playing nice, those with more leads than they can handle aren’t going to be throwing you the qualified crumbs you need. Those that have been there before you can become a true blessing if you play well with others. Many will let you grab onto their already established coattails and go along for the ride. They will share knowledge and resources if they know you are continuing the good name your online industry has worked so hard to establish.
At the end of the day, you want to be doing what you love and you want it to be profitable. Get involved with others in your field so you can learn and grow. Keep your eye on the prize.