Costing Your Freelance Work
So you’ve set up your home based freelance consultancy and you’re about to put in a bid for your first freelancing project ... but how do you work out how to charge out your time? What will you charge for your freelance services? How do you know what your new client will pay when they deal with loads of other freelancing resources?
The business world can be a cutthroat one and when you’re a start-up the last thing you want to do is price yourself out of the market.
Pitching yourself as a freelance consultant cheaply is the wrong way to go too so this article looks at how you can keep your freelancing charges competitive.
The first thing you should look at is your own overheads. Every freelancer will have different ones and the ‘tools with which you do your job’ extend beyond the obvious.
If you work from home, break down your household bills into an hourly consumption.
- What does it cost to heat the room you work in?
- Will you incur additional internet and telephone charges?
- Any stationary costs (printer cartridges, paper etc.
You will find that you’ll offset some of these extra costs against some of the benefits of homeworking such as fuel or public transport charges.
There may also be tax relief for some homeworking expenditure. The key is to keep outgoings in perspective and balanced.
Once you have worked out your overheads the next step is to do your research. Check out what other freelancers in your field are charging for their work.
If you network with other freelancers, ask them what they charge. Be honest with yourself and compare your own skills and experience to their freelancing talents – and always remain competitive.
It’s always useful to do a time and motion study so you have a good idea and breakdown of the time it takes to complete common tasks.
Keep in mind any ‘lost time’ you might incur too. Your clients won’t be expecting you to charge for making yourself a cup of tea, having lunch or for general administration duties.
If you find yourself in the comfortable position of being able to negotiate rates with a client, try to be flexible and always have a base cost prepared. Keep in mind the lowest rate you can do a job for and don’t go below it.
Staying flexible is an absolute must for every freelancer. Even if the projects you work on are the same, every client will be different. They will have different ways of working, different thoughts on payments and invariably different expectations.
Find out more about how to be a successful freelancer!