Negotiating payment for freelance work can be a challenging and nerve-wracking aspect of doing business.
But here’s what you need to know: It’s not that hard and it gets easier.
Here we offer some negotiation tactics for freelancers.
Leave Negotiations to the End
You’ve probably already done some freelance work and know that pricing is one of the last steps in the process.
Before you start talking money, you’ve already had a conversation with your client on the scope of the project, the work that they’d like you to do, and their timeline.
We recommend you end this first conversation with something like “I’ll look at my notes and let you know if I have any additional questions. If I have all the information I need, I can get back to you with a quote by 5:00 p.m. today.”
Also, remember to keep your language definitive. You do NOT want to give a price quote then say, “Let me know if that works for your budget!” You want to say, “Let me know if we can move forward with the project.” Don’t convey to your client that you have wiggle room in your pricing. (See more about your “minimum price” below.)
If you get an answer from the client and it’s not what you had quoted, the conversation isn’t over. It’s just a starting point.
Determine Your Lowest Rate
You should establish a minimum number for what you’ll work for. This number can be determined by the project or the hour. However you calculate it, set your lowest rate and do not go below it.
You may decide you want to take a project for less than your normal rate for some reason. It may be for a nonprofit client who does work that you support in your personal life. It may be to add a client in a particular industry to your portfolio to show your depth of expertise. Or it may be just because the project is fun!
Whatever the reason, taking less than your normal rate should be a one-off decision. Keep in mind that should you do more work with this client in the future than they’ve already come to expect a certain rate from you and will be hesitant to go higher.
For each job, figure out the lowest rate you’d be willing to do the work for. This depends on a lot of factors like your schedule, your freelance income, etc. This is not a range. This is a set number.
Remember that one of the reasons you became a freelancer is the ability to decide what work you want to do, for whom you want to work, and how much you want to charge. You decide on what projects you want to take!
For more information on how to set your rates as a freelancer, read our article here >>
Ask for Your Client’s Budget
Most freelancers have gotten this response to their price quote at least once: “That’s more than we budgeted for.” When (not if!) you get this reply, your response is to ask them what they had budgeted for this work.
If that number works for you, then terrific! Say something like, “Okay, I don’t normally work for that rate, but I’m interested in this project and in working with you. I can do it for [THAT PRICE].”
Provide Your Base Rate
If the client’s budget is still lower than your lowest price, you need to respond with “I’m interested in this project and in working with you, but I’ve looked at the figures and the lowest I can do this project is [YOUR PRICE].”
And then wait for their response. If they need the project done badly enough and want to work with you, there is almost always a way they can match your price.
If they agree to your number, then great! You’re ready to get started!
But if they still can’t hit your lowest number? You have one last option to try.
Adjust the Scope of Work
Remember, at any point in this negotiation process, you can walk away. Simply tell the client you’d love to work with them but unfortunately you can’t make the numbers work this time.
But if you really want to work with the client, you have one more option. You can rework the scope of work.
Say to your prospective client, “I can’t do X, Y, Z for this budget, which is what we discussed you needed. However, I could do X and Y for [THEIR QUOTE].”
If the client cannot give you any more money but wants to get started on the project, they may just be willing to do a smaller deliverable. And they’ll be very likely to come back to you later to wrap up the remaining phases of the project when more funds become available.
(You may want to ask the client when they can expect more budgeting dollars to be allocated. For instance, if you do work as freelancer in marketing, these corporations often have budgets that are dispensed twice a year. You may just have to wait until the next six-month period rolls around to conclude the work, but it may still happen!)
This is the final step in the negotiation phase. If the client still cannot make the price work, then this wasn’t the right project at the right time. There are always plenty of other clients and plenty of other work!
Also, don’t be surprised if the client ends up coming back to you later once they see what other freelancers are available and their quality of work. You may still be the best candidate for the job!
What are your best practices to negotiate freelance rates? Any tips for others? Let us know in the comments below!
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