Last week we introduced you to the world of pricing your freelance work with tips on determining your costs. This week we look at charging for your time and expertise, when it's ok to work for free and understanding the myth of exposure. At the end, you'll find a handy resource guide with more places to look for freelance advice.
Paying For Your Skill and Your Time
The second aspect of charging for your work, is charging for your time and your skills.
When you work for yourself, your skills and your time are what you have to sell so think carefully before you give them away.
Gauging how much to charge for your time is the hardest part of pricing. And nobody can give you a magic number because there isn't one.
Instead, you need to evaluate several factors:
Cost of Doing Business
First and foremost you need to factor in your costs of doing business (we talked about what these were last week). At the very least, your hourly rate should cover these. Think of it as your cost of goods. If you sold widgets and it cost you $2 to make one widget, you wouldn't want to sell it for less than $2.
What's your skill level? Are you a beginner or a seasoned pro? Is this your first project or your 20th? If you're a beginner this is where seeking some industry feedback can be very helpful. Having somebody with knowledge of your industry critique your work can be a tough exercise to go through, especially if you're a sensitive soul, but it's how you learn and improve and it will help you determine where you fit in the market.
What Are People in Your Field Charging?
This can be really tough to find out but, it can be done. This is where building a network of fellow freelancers in your field can be very beneficial. Talk to others who are at your level but also seek out those who are more experienced. Having a mentor is of unmeasurable value in any field - but remember they are being generous with their knowledge and experience - be respectful of their time and keep the information they share with you confidential unless you have their permission to share it.
How Much Do You Need to Live and Have a Life?
While not the determining factor in your hourly rate, you absolutely need to consider this. How much do you need to earn annually so you can pay your personal bills and have some leftover for a little fun? Determine what that number should be and then work backwards by calculating how many days you want to work in a year (don't forget to factor in time for holidays and sick days), how many hours you can work in a day that are billable and then get out your calculator.
Don't forget to distinguish between gross income (before taxes and cost of doing business is deducted) and net income (after you've paid the government and all your suppliers/service providers and expenses.). And yes! Don't forget taxes! Nobody deducts them for you when you work for yourself but a percentage comes right off the top of any money you earn.
Don't forget taxes! Nobody deducts them for you when you work for yourself but a percentage comes right off the top of any money you earn.
And, remember, things like bookkeeping, marketing, drumming up new business... those aren't billable hours but they still need to be done.
Here's a quick and very rudimentary freelance rate calculator but it will give you an idea of what you might need to be charging to reach your financial goals.
How long is it going to take you to complete a project?
Be realistic - factor in time for prep, shopping, travel, cooking, testing, photography, post processing, writing and admin (communication with your client and third parties, invoicing etc). Developing, photographing, testing and writing about ONE recipe can easily take a minimum of 8-12 hours. That's a day and a half of your time. Would you go in to work for your employer and work for a day and a half for nothing?
Remember if you're a beginner, you likely will take longer than somebody experienced - but does that mean your client should pay more because you're not skilled enough to finish it as quickly? No. So in that case, your hourly rate will likely be lower than somebody more skilled and experienced.
Many freelancers quote on a project by project basis and never reveal their hourly rate to their client. Whichever way you choose to go, you should always have an hourly rate in effect and use it when determining your overall quote.
Working For Free
There are times where it is completely acceptable to work for free. Because I'm such a big advocate of being paid for your work, people think I'm against this practice. I'm not. And I do it regularly.
Here are some examples of when working for free is perfectly acceptable:
- it's for a cause that you support - a charity, a fundraiser, organization etc. (but understand that non-profit organizations do have budgets)
- to give back to a community that supported you when you first started out
- school and student projects - I regularly let schools and students use my photos at no charge for school projects
- a barter situation - a lot of startups are looking for help but don't have the budget to pay for it. There's nothing wrong with setting up a trade or barter. I know several Vancouver food photographers who will help out a new restaurant with menu photos or marketing photos in exchange for meal credits. If you feel you are being compensated fairly there is nothing wrong with this model.
- building your portfolio: all freelancers have to start somewhere and it's not unusual to be asked by a brand to see examples of your work. But how do you get work to show when you're starting out? Portfolios are often built on free work. If possible, try to get projects that relate directly to the type of work you want to be doing.
- potential exposure - see below. Be very careful here.
One tip I received early in my career, (and which I ignored in the beginning and which led to some difficult situations) is that whenever you work for free, still do up a proper quote and invoice showing the amount it would have cost the client if they had been required to pay full price. Then discount that amount out. It's important for people to understand the value of the work they are receiving, especially if you want them to value and respect YOU and your expertise. It might sound strange but it's true!
The "Myth" of Exposure
As a photographer, a designer, and a writer, I used to get asked all the time to work for free with the promise of the "elusive and almighty exposure". You are told "well, we don't have a budget but, you will get lots of exposure and we will credit you."
well, we don't have a budget but, you will get lots of exposure and we will credit you...
When you first start out, being approached by a brand or publication asking to use your work can be hugely flattering and a big boost to the ego. "oh my gosh, somebody wants to use my work! I must be getting good! Think of all the people who will see it!!"
This is where you hear that big game show buzzer that says you're wrong.
The promise of exposure is the biggest trick in the book - and it still gets used because playing to people's egos works.
Working for exposure can, on the rare occasion, pay off huge dividends. But you have to pick and choose your opportunities very carefully. Most of the time exposure is a big, empty promise of new work and adoring fans that never materializes. Ask anyone who's done it (and we've all done it!). Tread very carefully when you consider this path and make sure that at the very least you are being publicly credited for your work (if you're not, how are all these adoring new fans going to find you to potentially hire you?).
And I'll let you in on a little secret that nobody ever wants to admit. The better you are at what you do, the less requests you get for free work. When you're at the stage where you're starting to master your craft, people start to recognize your skills and assume you will need to be paid and the requests for free work start to diminish (they never go away entirely). If I am completely honest with myself and look back at some of the photos and work I let people use for free back before I smartened up, it's sub par quality. Of course I was asked to work for free - the work wasn't really worth paying for!
Believe in Yourself and the Work That You Do
The scariest part of pricing is worrying that you are charging too much and people will walk away. That's a real risk. But equally risky is not charging enough. It can send all kinds of wrong messages to potential clients.
It's important, at whatever stage you're at in your career, that you have confidence in your work and that you're not afraid to say no if you're not being compensated fairly. The first time I did it I was terrified. But, if you don't stand up for yourself, nobody else will and sometimes, that means saying no to a paying job. And usually, a better paying job comes along to take it's place.
If you don't value yourself or the work you do, you can't expect anyone else to either. But, produce good work consistently and treat your clients professionally and work will come. Value yourself and the work you do, and others will follow suit.
For more resources on figuring out the ins and outs of freelancing, check out my resource guide for bloggers, freelancers and designers for lots of great places to check out for more information.