Have you ever been worried about how to price your freelance services?
If you just said yes to the question above, then you’re not alone! A lot of freelancers have been here and i literally get to be asked this question, a whole lot.
In fact, whether you’re a beginner or not, as a digital entrepreneur, one of the things you’ll have to deal with is going to be about how to price your services as a freelancer, in a way that will be convenient for both you and your clients.
Now, before you go about pricing your freelance services, certain things will have to be put into consideration.
For example, you’ll want to find out, the amount of money the service you’re rendering is worth, when compared with the amount other freelancers are charging.
You’ll also want to ask yourself questions like, what time and resources will I use before getting the work done completely.
You’ll want to contemplate the value you’re bringing to the table or more explicitly, your worth as the expert here, considering your level of exposure and experience etc.
And finally, your pedigree as a freelancer in search of new customers and referral will also play a significant role as you work on pricing your services the right way.
Now besides all these factors, supposing you’re a new digital entrepreneur, you’re also going to have people who will want to pay you a token…
Because they feel they are doing you a favor working with you, as you’re new and inexperienced.
Considering all these, pricing your services for a win-win deal could be very dicey and difficult for you as a freelancer.
And when it’s not properly handled, you can end up making your customer very happy while you go home sad. or vice versa.
When such unbalanced satisfaction arises, there’s bound to be issues…
For example, where the customer loses, he may never come back to you, refer you, or he may even bad mouth your work to others.
On the other way round, if you keep losing out while pricing your freelance services, you may end up getting out of business as there will be no funds to run your business.
So this is the more reason why pricing your freelance services the right way is very critical to your success as a freelance entrepreneur.
Because in a situation where you can’t charge the right fees, you’re already setting up yourself for failure.
Now, here are the vital things you need to consider before pricing your freelance services…
Know your Services
The first thing you need to do before pricing your freelance services is to know exactly all the details about the services you’ll be offering to clients as a freelancer.
You need this knowledge in order to categorize your services, based on the nature of services to be delivered.
With this knowledge, you can set up a more structured pricing system that will work for a wide range of clients either based on their financial capacity or the nature of services they want.
Let’s look at an example below…
Supposing you’re a freelance SEO Expert in Africa or other region that does not bill on per hour basis and you have a diverse category of clients spread across different continents and markets.
There are going to be times you’ll have clients that will need you to work on either of these services like on-page SEO, on-page and off-page SEO, technical SEO, link building, Content Creation etc.,
There might also be clients that will want you to work on a combination of or all of those services together.
And there could arise situations where a client will need just one out of all these services.
With such scenario, it is very clear that each request from your clients will demand a different level of engagement and resources from you so, it will be inappropriate to have a single pricing system fixed for all of the services.
For example, instead of having a fixed pricing like say 1,000 USD for each SEO Services, you might want to include a pricing that will work for a combination of one or more of these services or just one or a handful of it.
So, you might have to come up with a pricing that will work for someone that will need for instance on-page, off-page SEO and content.
Same thing goes for a client that will need only content writing services or the one that will need all of your freelance services, including technical SEO, link building and Keyword research.
Doing this simplifies your work as a freelancer, removes all sort of guess work while giving you the chance to fix a structured freelance pricing that will work for you.
Understand Your Goal
Pricing is a very key factor when it comes to achieving your goals as a freelance entrepreneur.
While getting set to price your freelance services, to be able to come up with a freelance pricing that works, you want to start with answering the question; “What exactly is my goal at this point”? Like what do I want to achieve with my business at this interval?
Answering this question is very important to all new Freelancers because it is one key factor that will help you in setting the right pricing for your services.
For example, if you are a beginner and your main business goal at this point is to attract clients that will help you boost your portfolio and get referrals, you will want to charge less fees so you can attract as much clients as possible.
On the other hand, if you’re already doing well with your freelancing business and you merely want to review your pricing, your motivation will be different.
So, in order to get things in the proper perspectives, you need to figure out your goals first and then work on pricing your freelance business in a way that’s in line with those goals.
Doing this will help you to achieve the goals much faster.
Compare your Industry Rate
What is the average industry rate for your services? Does your industry have a certain range of charges for the particular services?
Is there a specific range of fees for entry level freelancers, Mid-level experts, Advanced experts etc., applicable in your industry or niche?
What are your competitors charging? When you get the right information on this, you can then work on using this to shape the pricing structure for your services.
To get around this, a simple search on Google can give you a clear idea of what the other freelancers in your niche are setting the prices for their freelance business.
You can also use other freelance platforms like Fiverr, Freelancer.com, Upwork etc. to have a feel of the right industry charges, based on skills set and level of experience.
Evaluate your Cost Price
Before setting the price for your freelance services, one other important factor you need to consider is your cost price.
To figure this, find out how much it will it cost you to deliver one complete set of this service/product, taking into consideration, the time and resources that will be needed?
Knowing this will give you a clear idea on what it will really take you to price your freelance services in a win-win way that will work for both you and your clients.
Like I already mentioned above, I wouldn’t advice that you should have a cap (fixed price) on your fees. Especially as an entry level freelancer. Because this might not be necessary at the initial stages.
You can always get to set up a fixed pricing for your freelance services when your brand becomes much bigger and more renown.
But for a start, you can keep your fees open and flexible to the extent that it might be negotiable, depending on factors like the nature of the particular services, among other things.
Estimate your Client’s Budget
In the previous point, i mentioned that you need to keep your pricing structure open and flexible…
Reason for this is because, if you’re an entry-level freelancer, you will most likely come across clients with very diverse budgets. And they will definitely have to be considered.
For instance, there are going to be clients with a huge capacity to stay loyal but without much funds to pay up your exact charges.
I mean clients that can end up linking you with other clients. There’s also going to be others who have the capacity to pay but are still open to getting even lower charges from you.
Further more, there are going to be clients who’ll look at you as incompetent if you offer them smaller bills. At some point, I have seen a combination of all these kind of clients.
To avoid shooting yourself in the leg, you need to have a flexible pricing structure and then, focus on getting to know your clients before giving them a price list for your services.
In fact, whether you’re a freelancer or solopreneur, before billing your client, you might want to run a background check on them to understand their pedigree and capacity giving them your freelance pricing breakdown.
This is the smart way to set the right pricing for your freelance services.
As a freelancer, do not make the mistake of charging all your clients exactly the same fees, when you’re starting out…
Except in some cases where you’re working with a very similar and micro defined network of clients.
Instead of trying to put up all your clients in the same category, depending on your kind of services, you might even want to consider using a repeatable custom pricing model.
Consider your geographical Location
In most cases, your geographical location will always affect the ability of your potential clients to afford your freelance business. This will most times be due to the prevalent exchange rate, economic capacity or level of exposure of your client.
Take for instance, as a service provider, there will be situations where people located in a geographical region A may not be able to afford some particular prices for freelance service compared to people located in Geographical region B.
If you give both region A and B the same uniform pricing model, people in region A may see you as ripping them off with your services.
On the other hand, if you set your pricing to be too low because you want it to be similar for all regions, the people in region B may presume that you’re not good enough because your services are dirt cheap.
And the result is that you’ll end up losing from both ends.
To get around this, you have to set out the geographic location of your target audience clearly, understand the purchasing power of the people within this demographic and then set up a pricing system that will work for them.
When it comes to setting the price for your freelance services, there shouldn’t be a one-size-fits-it-all pricing model for all services.
Understand that you’re going to be working with diverse clients with different spending powers, expectations, paying capacity and levels of exposure to the services you’re offering.
And for this reason, you want to create a freelance pricing list that will be suitable for them, based on where they are coming from.
Unless you’re a well established freelancer with a large number of high paying clients, you want to be very particular about the factors listed above as they will help you in getting the right pricing model that will work for you.
From time to time, you also want to analyze your result and review your pricing system when ever necessary.
Now, here’s where we’ll end this tutorial on how to price your services as a freelancer. Want to learn more about how to grow your freelance services? Let’s help you.
Do you have any question or challenges about fixing your freelance services? Let’s hear you!