How to Determine Your Freelance Rate and Get Paid What You're Worth
One of the most difficult parts of becoming a freelancer/consultant or selling your services is figuring out how much to charge. As a freelancer or small business owner, putting a price tag on your services can be tricky and confusing. When I first started my consulting business I made the same mistake that many freelancers/consultants make. I charged an hourly rate not realizing that sometimes your expertise and knowledge results in you completing the job more quickly than someone who does not have the same level of expertise. What you know is more valuable than how long it takes you to complete the project. So if you base your compensation on the number of hours you spend working on a project you can potentially lose out on income. You should be getting paid for your knowledge and expertise, not the number of hours spent on completing the tasks. Clients don't pay for the number of hours you spend working. They don’t care if it takes you 30 minutes or 30 hours to complete the project. Clients care that the work is done and it is done well. They're paying for solutions, not hours. When you charge based on the project, you are tying the price of the project to the client’s end result. The end result is all that the client cares about.
When I took on my first client, I had no idea how to set my freelance rate. I believed if I asked for too much, potential clients would view me as being greedy and if I asked for too little I would be short changing myself and not get paid what I was worth. In the end, it resulted in me being underpaid and overworked. As my business started to grow I changed my pricing structure. Instead of hourly billing I changed to a project based pricing structure. Because I also provide speaking services along with consulting services my current pricing structure is a hybrid. For speaking engagements, hosting gigs, and facilitation services I charge hourly, but for freelance writing gigs or similar projects what I charge is based on the project and also the client's budget. This structure has worked best for me. Being able to integrate both has allowed me to set prices that are not only fair, but also reflect my knowledge, expertise, and experience. In short, your rate should reflect your value.
I've spent hundreds of hours (thousands even) educating myself, attending workshops, & learning about my craft so that I can bring top notch services to my clients. Remember your level of expertise, knowledge base, and experience all factor into the value you bring. Why shouldn't you be compensated for it? When I shifted the focus of my freelancing away from the time I worked and toward the value I delivered, it changed everything. It completely changed my income potential and how much I made.