How to Create a Pricing Strategy for Your Freelance Services

How to Create the Perfect Pricing Strategy

Being a freelancer is a difficult career path. It’s one of the most rewarding and exciting choices I’ve ever made, but there is no hiding the fact that it is difficult and scary. There are so many issues that freelancers encounter – how to gain new clients, how to network, how to stay productive, but the most common issue freelancers face seems to be – how to price their services.

When you go to Walmart and there is a price tag on a pair of shoes for $10, that’s the price. Then you go to a fancy store like Guess and a pair of shoes is $1000 (does Guess sell shoes? I don’t know this is a metaphor). Anyways – no one questions the price. The price is the price. No one tries to bargain or wonders why one is so much more expensive than the other. People still buy both, and accept the price difference because of the quality, the brand, and many other factors.

But, when it comes to services, especially freelance and creative services, things seem to change. The fact that you are paying for someones time rather than a physical product seems to make people think that placing a high value on things is a problem. It makes people think that the price is negotiable, and that the task is easy. Well, that is simply not true.

When you set your prices you need to be firm, you need to stick to them, and you need to be proud of them. You are worth every penny of what you charge, and both you and your clients need to understand that. Here are some questions you need to ask yourself when deciding on what to charge a client.

How to Create the Perfect Pricing Strategy

What services are you offering?

Make a list of everything that is included in the service you are offering. You need to make sure to narrow things down and make a list of the different elements of your service, not just the final product. Writing out an extensive list will give you a better idea of everything that goes into the project. For me this includes everything from the header design, to various rounds of edits, to the social icons that go in the sidebar.

How long will it take to complete the work?

When you’ve made your list of everything included in the project, make a corresponding list of how long each item will take. Include everything from the initial consultation to emails that have sent back and forth. Everything takes time, and your time is valuable. This will give you a great idea of how much total time a project takes. If you’re charging hourly this will also give you an idea of how long the job will take overall, and if you’re charging by flat rate, this will give you an idea of how much you’re paying yourself. If you write everything out and realize that a project took so long that you’re only paying yourself $3 an hour, there’s a problem.

How beneficial is this project to you?

You also need to consider what this project means to you. This is similar to the thing that freelancers often here and hate – someone saying ‘we can’t pay you right now, but this will be great for your portfolio’. UGH. Of course, I’m not suggesting that you work for free, but I’m suggesting you take the benefits of a project into account when pricing it. Will this improve your portfolio? Or maybe help you break into a new community of clients? Or maybe be the ticket you need to get a tonne of referrals? If it’s going to benefit you in a huge way, and you really don’t want to lose the job, consider making your prices a little more competitive. In my case, I want to break into a different client area (creative entrepreneurs) rather than the more corporate sites I’ve been doing lately. So I had a sale. These prices are lower than what I would normally charge, but since these new clients will help me in the long run, it’s worth it.

Are you excited about this project?

This really isn’t a pricing factor that you should broadcast, but how much you enjoy working on a certain project should influence how much you charge for it. If this is the client you’ve been waiting for or you are super excited about the idea of starting and the inspiration is flowing strong, then it doesn’t necessarily need to influence your prices. But, if you are dreading starting the project, feel uninspired, and know that the client is going to be a pain in the butt – reflect that in your prices. (You should also maybe be asking yourself why you’re doing this project at all, but that’s another issue).

How much experience do you have?

On job applications, there is always a mention of how much experience is required for a certain position, or the fact that salary will be negotiated based on experience. Sometimes they mention a salary range, and where you fall within that range is based on how long you’ve been doing what you do. The bottom line is, experience means a lot. There is a big difference between someone who has been doing something for 1 year vs 10 years. With experience comes expertise, authority, credibility, references, and much more. So, experience means you can charge more for your services. So, be realistic. Take a look at your history and your portfolio from a objective perspective, and think about how much you should be charging.

How good is your customer service?

Just like any company, customer service is a huge factor. You need to consider several things when determining the value of your customer service. How quickly do you answer emails? How easy is it for customers to make a purchase or a return? How helpful and understandable are you are over email or phone? Do you make your customers feel secure in their purchase or like they have to worry about it’s status? Think about yourself as a company, and all the different ways that your customers interact with you. I once bought a really expensive jacket from a store and shortly after I started wearing it there was a hole along one of the seams. I contacted them several times for reimbursement, but they never even answered my emails. This has made me realize that the value of this company is not as high as I thought it was, and I really would’t buy from them again. This is the same thing as you not answering an email for a week, or not meeting projected deadline. Customer service is important.

Can you afford to live?

This is the obviously the most important part of any pricing strategy, and can make or break a freelance career. Can you afford to live your life with the money you are making? If you can’t, you either need to reconsider your prices or reconsider your career. There is only so much you can inflate your prices to make room for a lavish lifestyle. If you have gone through all the other steps in this process and realized that you should be charing $500 for X job, but you really need to charge $1000 to make enough for rent and expenses, than there’s a problem. If you should be charging $500 and you need $550 to make rent, that’s a little more doable.

If you’re just starting out freelancing, or have been going for a while but are thinking about adjusting your pricing strategy, these questions are all things you should be asking yourself. But the most important thing is that when you choose a price, stick with it. We’ve all been there where we provide a price and then don’t hear back for days and are going back and forth in our heads wow did I charge too much, I should have gone a little lower. Or maybe if you quote an amount and the client agrees immediately, you’re left wondering whether you could have asked for a little more. There will never be a perfect price, and there will never be a perfect project, but a price is what you make it, and it is 100% your decision. Remember that!

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