How much to charge for a freelance – The key to success
You are determined, you have the talent, the knowledge and the desire to do freelance work, but you do not know how much to charge. You have interested clients. In fact, you have already been asked for a quote for a project.
Since you are not sure about the value of your services, you wonder how much to charge for a freelance? A logo, a website, a photo shoot...?
Whether you are a web programmer, marketing consultant, graphic designer, writer?
First, to know how much to charge, it is important that you keep in mind that your rates must be attractive to the client and profitable for you.
*You may be interested: Freelance fee calculator
If you want to know how much to charge for a freelance, we give you a guide to determine your rates:
Desired income and available time
The first thing is to know how much money you need to cover your living costs. Also, how many projects are you able to cover in a certain period.
This will allow you to set a cost per time.
First ask yourself how long you can complete a given project or projects.
Then create a “cost of operations” based on your personal needs:
- Feeding
- Transport
- Electric power
- telephone
- Taxes
- Equipment
- medical expenses
- etc.
To this add a desired profit margin : 10, 20 or 30%. It depends on the difficulty of the work you do or the ease of selling it.
Once you've established your cost of operations, add a contingency charge in case something unexpected happens, like your computer needs emergency repair or you need to buy new equipment.
Once that surcharge is placed, you have a kind of “desired salary” on which to work your rate.
To calculate an hourly cost, evaluate how many projects you cover in a set period of time and allocate your desired salary among them.
Some advise multiplying that number by 1.5 or 2, since you must pay your own taxes and freelance work has fewer hours.
Don't worry. Companies also charge all their operating costs at their rates. So your price will hardly be at a disadvantage with respect to that.
An example:
If your desired salary is $1,200, the number of legal working hours is 160 hours, and you can cover two projects in a month by investing an amount, say, 100 hours; dividing $1,200 by 100 gives you $12 per hour.
If you multiply that by 2, it gives you a rate of $24 per hour.
Not bad, right?
With that rate in mind, you can estimate how much you will charge for a project in the month. This way you can present a budget and at the same time calculate how much to charge if additional services are requested.
Do you charge by the hour or charge by the work?
It depends on the work you do. The above is an easy way to calculate a rate and allows you to set both a fixed budget and an hourly charge.
Keep in mind that it is not the same to offer a deliverable product –a web design or artwork for a magazine– than an intangible service –as in the case of consultants.
Also, there is a difference between starting from scratch and working on what is already done.
Generally, if you start from scratch you may need to make several initial proposals for approval before starting the actual work.
Meanwhile, in a job already started, you can take a general look and estimate the level of difficulty and time that you will require.
Based on these factors, you must determine with your client what are the objectives to meet. That is, what will he receive at the end of the project.
Consider how many changes the work may require before completion. Also, if there is a possibility of exceeding the stipulated hours to complete the service.
If the project has a closed delivery deadline, it is best to prepare a fixed budget and write the conditions under which it will be carried out.
You can determine this based on the duration of the project in calendar days and the level of involvement that it will require, and not on the hours as such.
How?
For example, if you are a programmer, you can probably put together a website in 4 hours. But you are not going to charge only 4 hours, because it is a job that involves specialized knowledge.
It's also possible that those “4 hours” turn into eight meetings with the client, one or two design changes, add a page, remove another, change images, etc.
In other words, what you should take into account is not the time it would take you alone, but the total duration in which the client can ask you for some changes or what you should wait while the project is approved.
Another option is to charge in phases:
Suppose you are a mechanical engineer and you are asked to design and build some machinery. Then you must teach how to operate.
You can present a budget divided into these three stages:
- Design
- Building
- Training
Do not forget to always define the scope of each stage . Determine in each one what the client will receive at the end of each one, how many times they can request changes, how many work meetings will be held, etc.
Technical difficulty of the project
An aspect that is not always taken into account at the beginning is the difference in the degree of technicality required by the different types of work.
It is wrong to establish a single rate for everyone.
For example, if you are a proofreader, correcting a novel will never be the same as correcting a study full of technicalities where you may even have to corroborate data from the document.
Let's say you charge $0.02 per corrected word in a children's storybook. But if it's a document with a title like "Techniques for Implementing Drip Irrigation Systems in Hydroponic Crops with Hybrid Seeds," you might want to reconsider those two cents a word.
Obviously, you should read more carefully before making any changes to such a document.
Always check the difficulty level:
It is your previous experience that will tell you which jobs will be easier and which not so much. That will help you segment your rates.
market prices
One important thing you should do is stay informed about market prices.
You can check the price of companies that offer similar services online and see if your rates are competitive and profitable .
Focus on seeing the regional market. Economies vary greatly in more distant regions.
Take your time to define your market and segment the types of client or project you serve. Based on that, you can set rates so you always know how much to charge.
Write it all down as reference prices, but be flexible when assigning the final budget. Especially if it is about recurring jobs or with good volume.
A client who guarantees you one job per month may have a better rate than one who commissions you one job per year.
Do not forget:
Regularly check market prices, keeping in mind that the economy is fluctuating.
You should not maintain the same rates for years, since over time your expenses increase, and you also have more knowledge.
Update with prices. Research different methods of setting rates, and don't be afraid to charge better for more specialized work each time.
Consult the client's budget
Whenever you talk to a client, ask him what budget he has considered for its realization.
Of course, that is to know if it is convenient for you to accept the project and to negotiate the price. But also to know if the rate you have calculated is very high, very low, etc.
This way you can make the necessary adjustments.
Last but not least…
Once you start running the project, try to keep track of the actual hours you spend.
That time that was not used in the development as such, but that does mean dedicating it to the project: calls, writing reports, work lunches... Or if you had to buy additional consumables that you had not contemplated (prints, prototypes, etc).
At the end, take out a "settlement" of the project. Then, make the necessary adjustments, if necessary, so that in future projects you know how much to charge.
Get to work: Do your numbers, set your freelance rates and sell has been said.
Good luck and many successes!
Do you want a faster way to know how much to charge for a freelance?
We invite you to try the fee calculator that we have created so that you know how much to charge for your work as a freelancer: Freelance fee calculator
Posting Komentar untuk "How much to charge for a freelance – The key to success"