The Practical Guide To Freelance Pricing - FULL GUIDE!
Everything you need too know about how to price yourself as a freelancer in the creative space
What if I shared everything I know about how to price yourself as a freelancer in one post. Well, this is it.
Most people would divide such a massive resource into 10 or so different article posts, but not me. I think that would fragment the content too much and would make it difficult to piece all the articles together into a concise “one stop shop” of pricing information. So, let’s do this.
This guide includes everything I know about pricing freelance work with practical stories, applications, pricing methods and more. I wish pricing work was simple, but after understanding the basic principles of freelance pricing and understanding all the different factors that can go into it, it can be, with time.
We will discuss topics like:
Does a fixed or hourly rate work better for me?
We talk about different pricing methods.
The downside to pricing too high or too low.
Determining your value.
We discuss how experience factors into your pay.
How to research pricing to develop the perfect price based on real industry data points.
Developing your desired salary based on needs and a budget.
Pricing based on client size, project size and project exposure.
Examples of ways to quote clients.
Pricing based on your demand.
Pricing based on completion time.
Right now, this article is available for FREE to my Substack subscribers.
This resource is currently only available as a 44 page pdf in my Freelance Masterclass for Creatives Course as premium resource, but I adapted it to an article format to reach more people outside of just my courses.
Trust me, this is just the tip of the iceberg.
Valuing yourself + Clients Accepting Your Prices = success
I hope this resource will make you more confident in pricing your work and helping you maximize your profits by finding the highest price possible without the risk of losing a client because you priced too high.
This is the biggest constraint on pricing that I think scares most freelancers. The balance between charging a reasonable profitable rate for yourself and not charging so high that it turns the clients toward other more affordable options.
Once you have a pricing system in place, you will be able to easily find that “just right” middle pricing point. As you start to price more and more projects you will develop your own pricing model. Some freelancers can think of the perfect quote right after hearing the project brief, while some struggle because of the complexity of the project.
It is not always an easy answer and it can depend on your client, your deadline and the speed with which you complete the project.
The tale of two pricing models
Below is a quick overview of the benefits and downsides of both main pricing models. A lot of seasoned entrepreneurs will jump at the chance to tell you the fixed pricing model yields them the most money, but this is not always the case.
Story #1
There is a young freelancer who is just starting to search for paid work. She knows the basics of software and has done a few practice projects.
A client found them via an Instagram post and wanted to ask the freelancer how much she would charge for a series of 10 Instagram posts for their business.
She noticed that a lot of other designers charge a fixed rate for a project. She researched some pricing for social media post prices and figured $20 per post sounded reasonable, this comes out to a total of $200 for all 10 Instagram posts.
She proceeds with the first post and realizes when she exported the posts they seemed a bit blurry. She frantically researches why this is happening and is able to export it properly at the right resolution. She also is having a hard time coming up with the illustrations for the posts, as the client did not give her a lot of direction. It took her over 2 hours to complete the first post. She agonized over it, making sure it was absolute perfection before moving on the second post.
This theme continued until at the end. Her total time invested into the project was 20 hours. We can take 20 hours divided by $200 to come up with just $10 per hour for her time.
It is true that fixed pricing can be the most profitable pricing model overall, but not until you have a firm grasp of how much time tasks and projects will take you. Hourly pricing would have been a better way to quote for the project.
She could have easily charged an hourly rate of $20 per hour (a reasonable rate for a beginner graphic designer) and made 20 hours x $20 = $400 for the same project.
Story #2
An experienced designer with several years of paid projects under his belt is contacted by a potential client. They loved his portfolio and the potential client got his name from a golfing buddy who used him for a company branding project.
This designer knows how much time a lot of projects take. He just completed a branding project similar to the one he is getting ready to quote. He feels confident in knowing it takes about one month of work to complete a full branding project with a brand standards manual, logo design and other deliverables.
He also has a set process he goes through when completing these types of projects. He plans to spend around 20 hours per week on each task, leaving an additional 20 hours of his work week open to other client projects currently in flux.
20 hours x 4 weeks = 80 hours of work
There are two ways he can price this project.
Because he has a branding package at a typical fixed price he can easily and quickly quote a fixed rate project at more than twice the price he could quote if he billed hourly.
Retainers are another form of pricing yourself as a freelancer that has become more common in the gig economy.
Freelancers typically experience huge gaps of income as client projects and payments tend to be staggered (see below example of a typical fixed price freelancer income).
This choppy income can make it hard for a freelancer to pay bills and work with a fixed budget for their families. One month, several client payments are sent, while another month could see no payments from clients. This has happened in my career several times.
That is why I always keep two months of savings in my checking account to address those issues, but not everyone starts out with that kind of savings.
Retainers equalize your income by charging each client a fixed rate for a certain amount of hours each month.
For example, the freelancer above has three clients on retainers and offers client #1 10 hours each week for a monthly price of $1,000.
The client may not need you as much that month and only use you for 8 hours a week instead of 10. Regardless, based on your retainer setup you typically will still bill the client the agreed upon $1,000 retainer fee for that month. If the hours the client needs you exceeds 10 hours per week then you can charge them an hourly rate on top of the retainer fee to make up for the additional work. This gives both you and the client predictable income and expenses.
There is nothing wrong with mixing pricing methods...
Not all client projects are created equal.
You may find yourself wanting to price yourself differently depending on the client project and situation.
EXAMPLES:
1.) When a short-term client becomes a long-term one
A short-term client becomes a long-term one and you currently have them on a fixed project pricing model. Each time the client has a project (which can be daily) you send them back a fixed price quote and finish the task. It takes you a while to figure out the right fixed price for each project and the client is looking for a more streamlined process. You may decide to switch the client to a monthly retainer fee of $2,000 per month for you to work Tuesdays and Thursdays each week on their projects. This simplifies your billing process.
2.) When fixed projects go beyond the original project scope
You may have priced $8,000 for a branding project but the client decides to add a bunch of other unrelated smaller tasks. Since it is outside of the original quoted project, you can charge for any additional hours with an hourly rate of, say, $40 per hour. This prevents you from having to stop and adjust an already agreed upon contract and price.
3.) When you are fast Hourly rates punish those designers who are both GOOD and FAST.
Let’s say I charge $35 per hour as a web designer. I have become so good at what I do with experience and time I can complete a similar website project in half the time. This also means I will make only half of what I used to make for the same work. This is clearly not fair to me. Using a fixed pricing model will allow me to do twice the amount of website work in the same time as I become faster, making much more money. The faster I become, the more I make. Hourly rates just cannot scale like this.
“$5,000... no, no, wait... make it $10,000... no, that is not right, make it $2,623. No, wait, it is a friend... make it $500...
Oh wait, your currency is in Australian dollars? Let's make it $650. No wait... it includes a t-shirt design, stationary and a few other things make it $3,500. Oh, they want a branding guidelines manual? Let's add on an extra $1,000 for that.
Oh, you have never completed a full Brand identity project for a paying client before? It’s your first time... oh well let's make it just $1,264. The odd number sounds more realistic than the even number. Wait, something STILL does not feel right.
OK, so the client has a very small exposure level, they are brand new and they do not have an ad budget. Well, it is hard to justify something in the thousands for such a small start up, and it is a friend and all, so maybe let's make it $809.
BUT, I feel like I need to value myself better as a creative and as a freelancer so I am going to add $1,000 to make sure that is the case, so call it $1,809. There, that is it.
Now, I feel like it is still wrong because I am nervous about what they will think of that number. Is it too high? Will they be offended? Is it too low and I could have gotten WAY more? Like $3809?
What do other people charge for similar projects in my area? It seems like they charge around $60 per hour. If I think it will take me 20 hours to do the logo (with research) and another 10 hours to do a logo usage manual, then 30 hours x $60 per hour equals $1,800. That does seem close to what I had.
I am starting to feel a bit more confident now that I factored in so many different things to get my number. Now it feels like I am not just guessing and that the number was developed with a purpose.”
As much as I wish I could answer the question on the previous page with an exact amount, I am afraid it depends on so many different factors, as you saw in my little example of what goes on in the minds of freelancers when trying to come up with pricing.
This list of different factors that determine pricing also serves as an index page for this resource. We will review each one of these in detail.
We are going to review all the major factors that determine the perfect quote for freelance work. DO NOT BE INTIMIDATED by the process of pricing work. Once you understand how each factor balances the equation, you will be able to draw up a complex quote in a matter of a few minutes.
I had a contractor come out to the house to do some detailed repair work for some recent water damage to my house.
He spent 20 minutes or so walking around with a flashlight to survey the damage. He went downstairs to see the full extend of the damage. He felt the walls for moisture and also determined what type of wood I had that needed to be replaced. He also took a few measurements and walked back to his truck. 10 minutes later he came back with a full project quote in his hands. It had several line items that broke down how much each repair job will take.
$1,250 - Toilet/Sink Replacement and Installation
$12,600 - Sanding and Staining of hardwood floors (2,500 sq ft)
$2,500 - Mitigation and mold removal to floors and basement
Total - $16,350
Fortunately, homeowners insurance covered most of that cost, but what impressed me the most was how confident he was with his quote and how QUICKLY he was able to come up with a complex quote. How was he able to do this?
He has been in the business for 20 years, he also does quotes everyday and already knows the going price for wood floors and plumbers and he also knows how long it will take. His experience in the industry allowed him formulate a quote based on many different factors quickly. The same will happen to you with practice.
The more you quote and perform paid freelance tasks, the quicker you will be able to produce a workable quote that is acceptable by the client and values you as a freelancer.
Value + Experience + Client Size + Project Exposure + Client Budget + Time + Demand = THE PERFECT PRICE!
This seemingly complex equation will be easier to grasp once you get to the end of this resource. You will know how to value yourself as a freelancer, determine client size and research competitor’s pricing to all help you formulate your quotes.
What is the total value you are providing to your client with your services?
There are two types of value, quantifiable and unquantifiable. Quantifiable value is relatively straightforward to calculate.
Let’s say I design and run Facebook ads for my client. With the ads that I set up and ran, the client received over $20,000 in sales with an ad budget of $2,000 (10x ROAS or Return On Ad Spend).
That means that the quantifiable value I brought to the client was $18,000 in sales after you subtract the cost of the ad campaign. You can say that services I provided my client had a relatively high value. What about something like a logo design? How on earth would I determine the value that a brand refresh has on a company?
What makes this a bit difficult is there are many factors to consider.
The Value of A logo Design
Have you ever wondered how some ad agencies charge $10,000 and up for their logo packages? They do two things to get those types of prices.
1.) They sell themselves with prior work that provided an insane amount of value to a client.
This is not their first gig. They most likely worked up to this level of pricing by providing work for hundreds of clients and slowly increasing their rates along with the value they provided. Not only that, they kept track of some of the quantifiable and unquantifiable value that resulted after the company launched the new logo/brand.
This can be in the form of a detailed case study. For example it may say, “Since launching the brand refresh in 2021, XYZ Company has experienced a 20% increase in social media engagement and a 15% increase in overall sales.” It could also be something like this, “In a recent survey conducted by our team, we found a that the majority of those survey had an increased connection to the company’s brand and had an overall positive view of the company.”If you cannot prove the value that you will add, it will be tough to sell someone a $10,000 logo.
2.) They provide more than just a logo design.
I can do a logo design in two hours, but is the design alone enough? Most companies that charge high prices for their projects provide lots of background and research into their thought process. This could be in the form of:
Sketching
Industry and competitor research
Discovering brand positioning
Considering psychological factors of a logo design
Creating mood boards or style guides
Target market research
Creating customer personas
Concept mapping and other idea discovery exercises
All of these activities add value to the overall project by increasing the chance of a logo design’s success and acceptance in the company’s market. You are not paying me for just a logo design, you are paying me for my PROCESS. That process is how you transfer more value to client and therefore increase your prices.
Perceived Value
Actual value and perceived value are two different things.
There was an online store on Etsy that sold custom handmade bracelets. The type of stone she used looked stunning and they had equally stunning photography of the product on full display. To her dismay, her bracelets were not getting any sales despite the almost perfect store setup.
The first thing anyone thinks to do when sales are dropping is to DECREASE their prices. Their hope is that their lower prices will attract new customers. She determined she needed to REDUCE her prices by adding a 20% off coupon. Sales still did not pick up. Her product and the wonderful photos in her store really made it look like a deal too good to be true. A great product at THAT price?
She thought to try something different, to INCREASE her pricing. To her utter amazement, her sales started to increase at the higher price point. The cost of creating her product (her raw materials) stayed exactly the same. She wondered, what happened here?
She experienced the bias of perceived value. Her bracelets were too good to be true, meaning people wondered what could be wrong with the product if it looked so good and cost so little. People did not order from her because they did not trust the value of the product.
The higher price point added perceived value and customers felt more comfortable paying the higher price as they were looking for a value that matched the photos.
When I go shopping for high quality shoes and I see a great pair for $20 the first thing I wonder is, “what’s wrong with it? There has to be a defect somewhere, maybe some ink got into the fabric or a stain or something!”
The same thing is happening when clients look at your pricing. NOT ALL CLIENTS ARE LOOKING FOR THE LOWEST PRICES. There are some looking for genuine high-quality work. If they see you offering a logo design for $10 they could easily pass you by. After not receiving any sales you may, like in the story, decrease your prices to attract new clients.
If you do receive a client at that lower price, then the value that client is expecting is really low and the worst case is they expect a high value product for a low price. Being able to properly value yourself as a creative is important. Value is just one of the many ways to do this.
$6,000 for a life coach, why?
I had a friend who needed a life coach to help her transition from busy Mom to CEO of her own fast growing company. She was shocked to see the prices for a package of 12 sessions. She tried to research reviews, testimonials, just anything to help her align the price to the value she would receive. She could not quite find what she was looking for and I think this life coach missed out on an opportunity to present the value she provides.
She could have had video testimonials of the impact she has had on other women in the business world, past clients etc.
My friend later found a life coach that was TWICE THE PRICE, but had so many confident reviews and information on their website she just felt like it was worth the price.
Make sure to think about value when pricing your work. It may not always be a quantifiable dollar amount but it can help steer you toward more accurate pricing.
As you grow in your industry experience and knowledge so does your prices.
I started out charging just $10 for a logo design, BUT I did not know how to properly use vector software. I was inexperienced and clueless about styles, branding and concept development, but I was willing to learn as I went.
Did I deserve to only get $10 for my first logo? Yes! It was a disaster and without the proper design knowledge the client could not use my final ideas. I did not create the logo in vector format because I did not know to use vector software, thus the files I provided the client were mostly useless.
We pay for experience. That is why plumbers cost so much to make a simple repair. You are paying for the years of training and knowledge that plumber has, not just for the repair itself. Imagine if a cheap plumber without experience fixed a leaking pipe, only to then cause a much greater leak in the future?
My logo design prices over time
Not happy with your pricing power? Just give it time. Not everyone’s timeline is exactly the same, but almost everyone’s timeline trends upward with experience.
It can take some time to establish yourself as a freelancer. Learning new software, tricks, styles, reading books and just practicing can all be considered some form of experience
Knowing how to gauge experience in your industry is paramount.
How do I determine an hourly rate for general creative projects if I do not have a groundwork for developing that price?
This happens all the time when researching salaries for a full-time position. As a registered nurse, for example, you can find out that in the state of North Carolina, in the United States, the average is $71,807 but the average here is not as helpful as the years of experience chart. If I am brand new to the field and looking for a job I need to factor in my lack of experience when accepting a competitive salary.
A little research goes a long way.
I am using upwork.com as an example of how to find out what others charge in your area of expertise. In this case I found someone while searching for the term “graphic design” who had 10+ years of experience and was charging $35 per hour.
It is also good to note what country they are from, too. There could be some geographic differences in rates.
The good news is that on upwork I found the country of origin less of a factor on hourly rates for the top searched freelancers and those with high social proof (reviews).
Create a large sample of prices to create a range.
Some online freelancing websites like upwork.com use hourly pricing as their main method of determining freelancer pricing. Instead of finding one freelancer that matches your skills and experience perfectly, sample several hourly rates from a wide range of freelancers with different experience levels. This will help you to better find your place in the experience scale.
How do you determine experience level during research?
Well, it depends on what freelancing platform you are on or if you are working directly with clients without using a third party website. If you are on upwork.com, experience level could be determined by how much that freelancer has earned on the platform.
The only issue with relying on this as a gauge for pricing is some freelancers could have earned six figures on a platform but still charge low prices. This is because of supply and demand. If a highly rated freelancer puts their prices really low on the scale they will demand more attention and be able to make more money. The problem with hourly pricing is this freelancer will have to work 60+ hours a week, much, much longer than someone charging twice the price with half the client work.
Experience by years
Way to research pricing
Build your experience scale Your goal is to build an experience scale to better gauge where you might fit. This will require some research depending on your field and specialty. A UX/UI designer with 5 years experience may command $70 per hour, while a graphic designer yields only $40 per hour.
If you are starting with zero experience, then you need to be focusing in on others who have limited experience and portfolios.
If you have 7 years of experience, look for those in the 5-8 year range to help give you a basis for where to start you pricing. What can help you further is to also research those with lower and higher experience so you can build out an entire scale of pricing.
This will help you validate and support your own experience range.
This happens in the real estate market with something known as “comps” or “comparables”.
A real estate appraiser will find three recently sold houses with similar square footage within a certain geographic area to determine the value of the home.
How could you figure out the pricing of a house without knowing what a house of slightly lower and slightly higher potential value can sale for in the current market?
Past prices are a horrible way to figure out pricing for a home. What the home sold for last year does not matter if the market has changed dramatically. The same goes for a freelancer’s pricing. Without properly researching competitor’s rates across a scale, it would be near impossible to price yourself appropriately with confidence.
1.) Third party freelancing websites
Visit several third party freelancing websites and source several samples of freelancers with varying experience. Which ones you choose depends on what type of pricing model you are using (fixed or hourly pricing). Do not worry we will cover this in detail next! This is pretty generic list, there are more specific websites you can visit depending on your industry or niche.
Hourly Rates
Upwork.com
dribbble.com/designers
Fixed (or Salary) Pricing
Indeed.com
Fiverr.com
Fiverr.com/pro (Premium Pricing)
Both
Thumbtack.com (US Freelancers only)
Behance.net/joblist
Only some job postings will mention hourly or
salary rates with required experience
You can see above a recent YouTube Video of mine using this same research method to find average pricing for graphic designers on Upwork.com
2.) Reach out to other freelancers
Join Facebook freelancing groups, threads on reddit.com, a discord group and ask others about pricing for your experience level. They will most likely be very willing to share their pricing to help others through this very tough freelancing challenge.
Facebook Groups
Going Freelance Masterclass
Reddit.com
reddit.com/r/freelance/
Upwork Reddit thread
Linked-In Groups
Freelance Professional Groups
Discord Channels for Freelancing
3.) Reach out to local freelancers
Find local groups of freelancers to join together to talk about pricing, freelancing issues, contracts and more. Meet regularly at a coffee house or online to provide accountability and provide support toward each other.
Finding locals
Meetup.com
Social Media Networks
Local Facebook Groups
Craigslist
Apps to facilitate group conversations
Discord Groups
Slack
Clubhouse
Below is an example of how to figure out the minimum hourly rate you need to charge to reach a particular monthly income goal.
This will help you establish a floor on your hourly pricing so it is never so low that you cannot take care of your basic needs. This example factors in vacation time and a realistic amount of billable hours. This assumes you can fill 35 hours of work with client projects. This allows an extra 5 hours time for invoicing and other admin tasks. You can adjust this to be a part-time salary by lowering the billable hours.
For those wondering, I do have this and a few other worksheets I show as downloadable resources that you can download here.
Working through this worksheet may give you further insight into a minimum hourly rate you need to have to cover your basic expenses.
A t-shirt design that will be worn by millions should not be priced the same as a t-shirt design worn by a little league team.
Sometimes you won’t know the exposure level of a project until it is shared and used. A social media post could go viral and your little $20 dollar post you designed for a client gets over 5 million views. A lot of the time you can predict how much exposure your project will gain based on client size, followers on social media and industry.
In 1971 Carolyn Davidson created what would be known as the Nike Swoosh. She was just a graphic design student at the time and she was paid around $35 for a logo that would later yield billions.
How would she know a small little shoe company would be so big and that her logo would be splashed on so much apparel? There are situations where factoring in exposure can be tricky. Let’s review some other scenarios.
Size up your client What if I am a video editor and I am pricing for a video for a large company.
They have at least one million YouTube subscribers. I also can research the average views on a typical video on their channel to find out they average 250,000 views per video.
This allows me to gauge the client budget and size and determine that this project will have some pretty large exposure.
They are most likely expecting a decent quote, somewhere beyond $1,000 for a six minute video edit. A smaller YouTube channel for a local dance studio is looking for a video to be edited for YouTube. They have just 2,500 subscribers and their average views are around 150 per video. I can start to assume the project exposure potential will be lower on the scale and understand my pricing power is limited.
Creative licensing works in the same way.
Let’s say I want to purchase a stock photo to use for a project. When I go to purchase the graphic it requires that anything that will have over 250,000 potential views will need extended licenses. Extended licenses cost more and this is because the photographer needs to be properly compensated if their photo will be exposed to a larger audience. The same goes for you as a freelancer. Price your work according to the potential project exposure.
Your logo design package is different than mine. That is because the deliverables are different.
Deliverables are the final end products you provide to a client. The final list of needed deliverables should be determined via a consideration with the client before a project is quoted. This assures that you and the client are on the same page and they can compare apples to apples with other freelancer quotes.
Let’s say freelancer #1 has a logo design package that includes a .svg scalable graphic, a favicon and even a 5 second animated version of the logo, as well as all of the standard deliverables you might see with a logo design (jpeg, png, vector files, pdfs etc.).Freelancer #2 just has the standard logo design deliverables and does not offer any extras.
If they both quote $1,000 fixed price for their packages which one is the better deal (assuming equal capabilities and portfolios)?
Freelancer #1 has a good chance of winning the bidding war against #2, but really what this does is it gives freelancer #1 a reason to raise their prices. They are providing more deliverables, ones that could be highly desired.
Using line items to show the client value
Too many line items confuses a client, too little makes them have questions.
When creating a client quote. make sure to break larger projects down into major activities or milestones. This allows the client to see how your package may differ from others. This will also answer so many possible client questions.
You can break your line items down too much and cause confusion. Make sure each line item adds value and is not just “filler” to pad your quote to make it look exhaustive. As with anything in freelance, balance is key. Simple, straightforward but enough detail to answer basic questions about your package.
Hourly quotes are quoted a bit differently
When quoting hourly rates or “estimates” make sure to include a wide range.
For example 12-15 hours for the first line items allows you give the client a rough estimate of time required without committing to one number. This allows you to flex your hours if one line item or part of the project takes longer than another. Also make sure to put a statement on all estimates that this is just a rough estimate and not a final invoice or quotable price. Hourly rates can vary and the total price may change by the time the end of the project arrives. Adding this statement allows the client to understand this and not get disappointed or upset when receiving a invoice that might be higher than what was initially estimated.
Finding out your client’s budget is like a game of chess. Allow them to make the first move so you know how to react.
I went in to buy a minivan for my growing family. Negotiation is the name of the game when getting a good deal on a new car. After talking to the salesman and determining that we were ready to move forward, we proceeded to sit down and bargain. He asked me several times what price sounded reasonable for the car. I resisted. I knew if I gave him a price I was happy with he could accept that price even if I could have gotten a lower price.
Go Last. When you go first in the negotiation process you set the price floor and ceiling.
Let’s say you are working with a client to figure out the right hourly rate for a part-time continuous freelance contract.
They ask you what rate you would be happy with. You mention that $25 per hour sounded reasonable. They quip back that they are very happy with that rate. This may not always be good news. Their quick and easy acceptance of your number means you could have quoted a higher rate.
You want a little push back when sending project quotes. Not so much push back that it causes the client to exit the negotiation.
Some freelancers get nervous when a client says their rates are a little high. This is perfect because you just found your client’s ceiling. Perhaps lowering your number just slightly can show the client you are willing to be flexible but not so much that you are not getting the maximum amount acceptable by the client. Negotiations are a dance, rarely ending after the first measure.
The more research you have on the client, the more ammo you have in the negotiation process.
You will know how far to push them and what amount they might be expecting in a quote.
As mentioned in a prior section on finding out a specific project’s potential exposure level, researching a client budget is very similar.
A small band who only has 4 shows a year may not be able to afford a $1,000 logo. A band that has sold out shows across the country and will put this logo on merchandise can easily afford a $1,000 logo.
A simple Google search and a view of the bands web page can easily grant you these precious clues.
Examples:
1.) Looking at their main website
How does it look? How much do you think they spent creating it? How is their copy writing, does it look like they hired a professional? What information can you find out about their industry just by looking around?
2.) Looking at their social media
Does it look like they have a dedicated social media team to manage their accounts or just one person? Are they responding to them? Are they growing?
3.) Public Data
Some industries and publicly traded companies have public documents or annual statements where you can see the companies total revenue and profits. This makes more sense if you are quoting for a large project.
4.) Reviews
Reviews can tell you more than just how liked the product or company is. They can also tell you how many sales they are making. Do they have 1,000+ reviews on their Amazon store or just 10? Most of the time, for every 10 products sold their is an average of one review.
5.) Looking at their closest competition
Are they the top in their industry? How do they rank compared to their competition? Look at likes, video views, subscribers or any other way to quantify their success.
6.) Total employees
Finding out the total number of company employees is a great way to gauge their budget. Just two employees may signal that their budget may be small.
This is especially true for freelancing websites like UpWork.com or Fiverr where reviews are everything.
On almost any third-party freelancing website, high review scores are needed to rank high in organic search.
For your first job opportunities, make sure to go above and beyond not only for client satisfaction but for the hope of a positive 5 star review. Never be afraid after a job well done to ask for a review.
This is where you sacrifice a few extra hours even if your pay is fixed, to make sure you have not only a strong review but a nice case study to feature using real client work.
Review scores, success rates and testimonials are more valuable than gold.
These measurements of prior success can motivate a potential client to trust your work and take a chance on you. Always take a moment to include a testimonial in a client proposal, quote or your portfolio. On Udemy.com my courses with the highest ratings tend to sell the best and the same will go for your services. Are you a hot commodity? You may just have earned yourself some more pricing power!
A quick little story about the power of supply and demand, which of course effects freelancers as well. When a product or service is popular, but there is a limited supply, prices tend to be pushed upward because of the willingness for people to obtain a hot product before someone else. I unfortunately experienced this first hand in the summer of 2020, in the heat of the COVID crisis. I wanted to purchase a Nintendo Switch for my 6 year-old’s birthday. Because of supply issues, due to COVID, there was a limited supply of the consoles. I checked for weeks and prices remained twice the price of the original retail price.
I had a deadline, so I had to pay $550 for a basic Switch console.
When working with international clients be sure to consider exchange rates as a factor in your pricing.
$1 US is valued a lot more than a Canadian dollar. I found this out the hard way after sending an invoice to a Canadian client. They paid me the agreed upon $1,200 rate but after the $1,200 Canadian dollars were exchanged for US dollars I was left with only $850.
I have students from over 150 countries all over the globe, all using different currencies. Working with international clients is more common now than it was just 10 years ago. This is because of third-party payment companies like Paypal which allow for an easy exchange of currencies from different countries.
Your pricing power may increase or decrease depending on exchange rates.
The US dollar (my currency) can go further in India but this also could mean my pricing power in India as a freelancer might be lower, as they have access to freelancers willing to charge in a more affordable currency.
The good news with freelancing websites like UpWork.com is I have found international freelancers are able to charge similar rates across the globe. This is good news for those who in countries like Brazil and India where a US dollar can go much further in their country and the cost of living is lower.
Story
The air-conditioner in my house went totally out on a hot summer day. I needed cool air, fast.
We got several quotes from different air-conditioning guys to replace our broken unit and got quotes all over the place. They all seemed to be reputable and trustworthy but what made one different is they could get out there the very same day. The quote was the highest by far, but we did not care.
We called them up and they got the job and we got cool air by dinner time! The same thing goes for freelancers. Some jobs are time sensitive. If a client demands that a job be done in a abnormally short period of time, a “pricing premium” needs to be added to your quote.
I need a logo design in 24 hours and for $10!
How many times have we seen this posted in Facebook groups and other websites? The quality of applicants this client will receive will be very poor. This is because high quality applicants will be demanding much higher prices.
This is a great pricing method to follow. This will respect your time but also give the client the benefit of paying for speed.
I need a logo design and I can work with your timeline = $400
I need a logo design in one week = $600
I need a logo design in 24 hours = $800
If a client demands all three, it might be a good time to let them go or not respond.
Demanding all three from a freelancer is just plain wrong. First of all, it is not even possible. If I try my hardest to do something super fast and also decide to lower my pricing too, the quality of my work has to suffer. If I increase the quality of my work and try to do it fast, I will be so in-demand that my prices will have to be raised. If I do something high-quality but also at a lower prices, I will have so many projects I would have to work through them slowly to catch up.
Every project is different.
Think about each one of these items when developing your price. Some require just a few seconds of thought, while others (like value and client budget) may take a little bit of time to discover.
Like mentioned before, in time, you will be able to formulate quotes quickly. Use this guide as a starting point for developing your price. Each one of these items can either add or take away your pricing power.
This can change as you gain experience, gain social proof and become more in-demand as a freelancer.
You can download this worksheet download here.
You now have so many reasons to feel confident about your pricing.
You will start to notice a theme in your ranges. If they tend to be higher, then you have a lot of pricing power. If they are lower, you can choose to quote the project at a lower price than average OR you can decide to move on to another client opportunity. Our first client jobs may not yield as much as our later ones.
Because you did the research, you now have a pathway you can take to formulate pricing based on several different factors.
Your client will tell you have done your homework and you might just win that next job opportunity!
Make sure to leave a comment about what you thought or your questions about freelance pricing!
Know anyone who could benefit from this pricing guide? Feel free to share with others!
Make sure to check out my list of courses on my website below!
Thanks for replying about the $6.99 price. I couldn't figure out what I was doing wrong. I bought the guide some time ago, but I wasn't sure I had gotten all the extras. I thought for $6.99 I would have two guides but also all the extras for sure. Would all the extra things have been included when I bought this 2 or 3 months ago?
One more comment: I am amazed by what all you know and that you have made all your info available.
how do you get the $6.99 price? When I go to check out, the coupon BLACKFRIDAY is invalid, and the price is $19.99.