When discussing prospective work with a client, they will always have a budget in mind for the project – they will probably have an idea of what they would like to pay and the maximum they would be willing to pay – but this isn’t something they may want to share with you, the freelancer. As soon as the first discussions about a project occur and issue of pay arises, whether you are asked how much you charge or whether a client simply states “this is what we will pay”, it is time to take on the role of a negotiator.
Get the client’s offer on the table first
One reason for doing this should be blindingly obvious: the client may well offer more than you would have originally asked for. Even if this is the case, you don’t need to thank your lucky stars and accept the offer straight away, you should always try to push for a little more. If you don’t ask you won’t get. Asking for more means there’s a chance you will get more, but of you don’t ask for more then you have wasted an opportunity. Think longterm, not just in terms of this project, but in terms of your future communications and work with the client. If you accept an offer which is too low you will struggle to negotiate a better deal for any future projects, unless you can prove you will be doing substantially more in this case. Don’t hamper your long term profitability by making an early mistake.
If you make the first move, unless you pitch far too high, you may never be able to negotiate the same rate. If you were to mention a rate and have the client immediately agree, this means you are probably missing out on much more which they would have been willing to stretch to. So the first rule to remember in the art of negotiating is simply this: don’t make the first move. Allow the client to put forward a rate – which is probably well below what they would be willing to pay – and then try to push upwards from there.
Get comfortable negotiating
Yes, you may want your clients to like you, but they are still clients. You want them to like you because of your work and because – hopefully – you’re a pretty nice person to be around. You are not there to do them favours, you are there to work and earn enough to pay the bills. When going freelance, you have to get comfortable talking about money and negotiating rates. A couple of minutes worth of discussions and bargaining can push up your profits further than you may have thought possible. You are not being unreasonable, you are only pushing the client to pay you what you are worth. If they have an upper limit, why not push them to it? They would gladly push you to your lower limit if given the chance.
That’s not to say that you can’t accept a rate now and push for an increase in the future, but you can often expect to meet stiffer resistance in this case. Upon agreeing to work at a certain rate, if you are still working with the client in a year or so’s time there is no harm in pushing for an increase, especially if they have been benefiting from your work. Point out how well-received your work has been, how much you have done, and/or how long you have been working at the same rate and suggest that this should be pushed a little higher. Don’t be shy, negotiating and ‘playing hardball’ is a sign that you are professional. Any clients who become uncomfortable with this or take offence are probably not the sort of clients you want to be working for in the first place!
Why you charge what you charge
Remember what you need to take into account when pitching your rate as a freelancer. You definitely can’t afford to pitch at the hourly rate you worked at when employed. Your fees will have to be pitched at a level which allows you to make up for the lack of job security, the lack of various employment benefits (sick leave, holidays, pensions), the time you will have to spend on admin, the resources you will need to pay for, and any costs incurred by renting office/desk space. Your overheads can really add up; even when working from home you can expect higher electricity bills which should be factored into the rates you charge.
All of this needs to be factored into your ‘lowest possible rate’ and you cannot afford to accept work which pays lower than this. Everyone needs to pay the bills. When you know this figure, you can start negotiations which a figure in mind – hopefully well above your ‘lowest possible’ rate – and through making the client make the first move, you can leave open the possibility that you can ask for a figure which is well above this! If a client catches you off guard, or if you would need time to factor in all that a project entails in order to work out a reasonable fee, don’t be afraid to break off negotiations so that you can bring a well-considered figure into discussions.