Charge what you're worth…
I see this phrase over and over and over again.
On websites, in groups, in courses.
“Don't forget to charge what you're worth.”
“Make sure you're charging what you're worth.”
And while I understand the sentiment, in reality this statement means absolutely nothing.
“Charge what you’re worth” is an insidious lie started by some high-priced coaches who need to justify how much they’re charging you.George Kao
I couldn't have put it better myself.
Your worth should not be tied to your price.
Because if it is, wow, will you be in trouble.
Your rates should accomplish a couple things in your clients' eyes:
- They should set expectations, both of quality and deliverability of your promise.
- They should set up the value of the work being produced.
Not your value… not even the value of your work… the value of the work being produced.
How much is your work worth?
Well, that's where things are going to get sticky because there are so many formulas out there. There doesn't really seem to be a standard market value on writing that you can rely on for setting your rates.
In fact, the closest thing there is to a standard market value is this chart put together by the Editorial Freelancer's Association. And even then, I see people charging far, far outside these ranges.
And it doesn't help that clients and writers alike tend to undervalue writing.
For example, let's say you've been hired to write a blog post for a client within your niche. A blog post of, say, 800 words in your niche (so it doesn't require extra research) might take you, what, about an hour to write up and complete? Barring any major issues or distractions, of course.
According to the Editorial Freelancer's Association, the average non-specified writer charges $0.20 to $2.00 per word for a writing assignment. Specialists usually charge more, but let's take the low end of this and go with the $0.20 per word times 800 words and you get a rate of $160 for that blog post.
Now, I happen to think that $160 for a blog post is a fair and reasonable price for something that didn't require a whole lot of extra research because you knew the subject matter, even if it is on the low end. Not because of the time involved but because of the expertise.
But, and this is a big but, this is where newer freelance writers have some difficulty. They see the $160 price tag, and do you know what most new writers do? They lower their rates.
“I don't have the experience to justify that price.”
“I don't want to chase this client away by charging too much.”
“No one's going to hire me for $160 per hour for writing.”
And you know what, you're right. No one is hiring you for $160 per hour for writing. They're hiring you for your expertise.
And the rates get even worse for generalist writers because they will lower their rates (usually to something horribly low, like $10) and while you might think $10 an hour isn't wretched, that's not counting the research that a generalist writer might need to do to even do the writing.
But, if you take you out of the equation — don't calculate the time involved, don't calculate the experience involved — and just focus on the work being produced: what is that worth? Is it worth $160 now?
My bet is on yes.
Your Speed and Skill Should be an Asset, Not a Hindrance
Now, let's say you've decided to tie your rates to your time. And let's say you want to set your rate at $25 per hour. So that same blog post project that takes you an hour to write – and suddenly instead of $160 you're only getting $25.
Why? This is a punishment for being efficient. If anything, being able to finish the blog post should raise your rate, not lower it.
Charge Based on Market Rate
George Kao recommended, “you’ve got to price based on what clients are expecting and seeing in the market. Look at your niche mates and what they’re charging, and then compare your needs, and branding, and price your services accordingly.” And while I agree, sort of, I also want to take this a step further.
You can't just look at people in the same niche to see what they're charging because those rates are not determining market rate.
You also have to look at where you're finding those clients, or how clients are finding you.
For example, if a client finds a freelancer through a search that led to the freelance writer's website, chances are good they will want to view that freelance writer's rates, after which they may start looking around at other sites so they can compare rates. At that point, the Market Rate you're using as a comparison becomes other freelance writers who are using their own, independently-owned websites.
But, if a client finds a freelancer through a job-bidding site such as UPWork or Fiverr, then the freelancers on those sites will determine the Market Rate against which you'll be compared.
And let me tell you something — those sites are not exactly known for high-paying rates and clients. In fact, they have a reputation for low pay – making it so that for 70% – 80% of the projects posted, the clients hire the lowest bidder.
They really are like the dollar stores of the freelance writing sites: clients go in there expecting to pay a lower rate than they would pay anywhere else. And for the most part, while you may find a treasure here or there, most of the work churning out of those sites reflect the fact that those writers are working for extremely low rates.
So, yes, try to make a comparison to the Market Rate by comparing what freelance writers in your niche are charging, but don't forget that market rate also includes the venue through which a client will find you.
Don't Wing Your Rates
Almost every freelance writer in the history of forever has, at some point early in their career, been caught off guard by a potential client, friend, or acquaintance who asked them, “hey how much would you charge for...?”
And they tried, with all their might, to think of a fair and reasonable rate to charge without making this person wait forever staring at them as they tried to run all the math in their head.
We've all done it, and every time we've done it we've shorted ourselves.
Rates and fees are not something that should be wung. This isn't art we're talking about — this is revenue. And determining your revenue is a science.
So, before you take on even one more client, sit down and work on your rates a bit. Even if you think you already have a good idea of what your rates are, get them written down, review them, make sure they work for you so you have an answer when someone asks you a question.
And, better yet, get in the habit of answering that question with “go ahead and send me the details, and I will take a look and send you a proposal” instead of giving them an answer on the spot.
Breaking Down Your Project Rates by Task
One of the things that really helped me solidify my rates was to start breaking down the tasks I perform for each project into their own values. For example, my base rate is $0.05 per word, from there I add $0.01 – $0.15 per word for each task based on certain factors:
- $0.15 per word for a book
- $0.12 per word for a blog post
- $0.03 per word for items within my niche (next to no research required if they are already within my niche, and I already have my resources readily available)
- $0.05 per word for items outside of my niche
- $0.10 per word for research
- $0.05 per word for keyword / SEO research
- $0.02 per word for formatting
- $0.03 per word for self-editing
- $0.02 per word for second revision
You get the idea: I've assigned a per-word value for each line item that might go into a client's project.
This is important because not only does it convey the overall value of each piece of the work to the client, but it also gives you a negotiation point. If a client comes back and says “I'm not going to pay more than $0.25 per word,” instead of having to choose between letting the client go or reducing your rate, you can instead choose to cut out some of these services until you meet their budget.
And, it's always a good idea to add in some optional services that would complement your writing services, such as graphics creation, accompanying newsletter content, or even social media captions and quotes. Not only are these good ways to boost your revenue, but they also serve as negotiation points.
Don't Let a Client Determine your Rates
One mistake I see a lot of freelance writers make, especially new freelance writers, is that they will allow the client to determine their fees.
For example, a client will list a project on a site, or send an email to a freelance writer, explaining the important details and then they include a line like “I'm willing to pay $X” or “I will pay no more than $X.”
Or, sometimes, a client will catch wind of a discount you once offered to someone or a project you undercharged for and they will want you to make them that same offer. Sometimes a client will be basing their budget off what someone else charged them before.
And if you're new and don't have a large portfolio yet, it can be intimidating to have a potential client try to set these types of expectations on you. But here's the deal: you run your business.
- You determine your hours of operation.
- You determine your rates and fees.
- You determine your tools and systems.
- You determine which clients you want to accept or decline.
Just like you could not walk into another business and tell them what to do or how much to charge for it, it's not up to the client to determine these things for you. And if a potential client comes up to you with some preconceived notion about how much you will be charging, then that really is all on them.
It's not your responsibility to meet the expectations they set for you prior to meeting with you.
Charge What You're Worth: the Value and Benefit to the Client
Most of the clients you come across won't actually know how to value the end-product that you send them. If you tell them you want to charge $160 per blog post, they aren't going to know whether or not that's a good price or a bad price. Even if it matches other freelancers in your niche (and it should), they aren't going to know whether or not that's a good price.
What a client can measure is the benefit they receive after hiring you to do that writing for them:
- Saving the time it would have taken for them to do it themselves.
- Saving the money it would have cost them to hire a staff writer.
- Increased SEO benefits.
- Increased reach.
- Increased traffic.
- Better conversions.
- Higher ROI on the content.
You're not just charging for your writing skills, your time, and your experience. You're also charging for your expertise, both as a writer and in the subject matter, and for everything you bring to the table.
You're charging for the impact that you're making on their business.
Did you enjoy this article? Here are some more posts on freelance writing you may like:
- The Complete Guide to Finding Freelance Writing Jobs
- 5 Steps to Marketing Yourself as a Freelance Writer
- Are Freelance Bidding Sites the Empowering Solution They Claim to Be for 2020?
- Should You Use a Pseudonym? Things to Consider Before Choosing a Pen Name.
- How to Create a Rate Card for Freelance Writing