Thursday, February 5, 2015

Don't Get Beat by Low Pricing, Earn What You Deserve as a Freelance Writer

Countless marketing studies have shown that buyers build their initial opinion
about a service or product based on cost. When asked which item is better between two that are identical, consumers almost always prefer the higher-priced item. Even when they are exactly the same. 

In one case study I saw recently, regular people from the street were asked to try a free sample from two cakes. Although the tasters were unaware, the cakes were absolutely identical except for price. One cake was $15 and the other was $55. Every single taster said that the $15 cake was too dry and the frosting was bland and tasteless. However, when they tried the $55 cake, they expounded about its superiority over the $15 variety. The icing was delicious and creamy, the cake had the perfect texture and was anything but dry. Even once they were told that the cakes were made in exactly the same way using exactly the same ingredients, they chose the $55 cake over it's lower-priced variety. 

This goes to show you the power of pricing. Make sure to price yourself right, and your services will get the respect they deserve. This freelance writing rate calculator will help you determine what you should be charging for the work that you produce.



Calculating Your Freelance Writing Rates

I don't know if you noticed it, but I added a link up there at the top of the blog. "Freelance Rate Calculator" will take you to a simple form that helps you to determine what your hourly and per word writing rates should be. That's all well and good, you may be thinking, but what do you do with those rates once you have them? Perfectly valid question, freelancer!

Freelance Writer's Rate Calculator
Annual Income
What do you want/need to earn every year from freelance writing? This is the main figure used for calculating your rates in this form. There are a couple ways you can go about this: 
  1. Figure up your expenses, bills, overhead and cost of living, add an amount for unexpected situations and a little for comfort to come up with a figure that is optimistic and liberal. This is your "Best Case" goal and will return rates that may be a little high but would leave you extremely happy in the end. 
  2. Determine your "bottom dollar" annual income that you HAVE to achieve to survive. The resulting rates are the very least that you can earn and still come out ahead. This will help you to know when a negotiation has went kaput and it's time to walk away. And that will happen, trust me. The worst thing you can do is get into a project where you're getting the short end of the stick. It's far better to pass up a client or two than work for a wage that can't pay your bills.
Workdays Per Week
How many days out of the week do you devote to completing projects and working for paying clients. You may work through the week and take the weekend off. In that case, enter 5 into that box and move on to the next.

Workhours Per Day
Freelancers call this "billable hours". Essentially, it's how many hours out of a workday that you devote to paying work. This figure doesn't include time you spend checking emails, social networking or anything else that isn't specifically "billable" to a client. 

Sick and Vacation Days
This figure is pretty self-explanatory. Be sure to take into account government holidays and days when most people take off, such as Christmas. Also, it's probably a good idea to throw in a few days for emergencies or unexpected absences.

Words Per Hour
How many words can you write in an hour? This should be your best work, too. Make sure to account for researching and editing the content. Typical answers are anywhere from 500 to 1000 or more words. Just remember that this is to determine your Per Word rate, so it should be based off the highest quality edited amount you can produce consistently.

Hourly Rate 
With this bad boy in hand, you can pretty much determine any other type of price that you may need. As long as you have a good idea of how long it takes you to complete a page, a set number of words or a common project type, then you can apply the hourly rate to that knowledge and come up with a baseline rate to charge a client.

Per Word Rate
Knowing what to charge per word is a necessity in the freelance writing world. Many clients prefer project estimates to be per word price. Quoting a per word rate is beneficial for you because it gives you flexibility and allows a little room for error. However, before you quote a per word rate on a project, always take into account any additional requirements and add the extra time to your price. For example, if a client requires numerous screenshots with explanations along with each article that you write, you may want to add a cent or more to your base rate to account for the extra time and work involved with taking the screenshots, editing them and writing alt text, captions and descriptions.

Putting Your Freelance Writing Rates to Work

The most important thing to remember is that these rates are averages. You'll likely earn more or less depending on the job and the client. The goal is to come out about even in the end when compared to your desired annual income. If you determined a baseline rate, use that as a guide for what you must get to break even and only negotiate below that figure if there are extenuating benefits to doing so. Some benefits may include building a portfolio, building clientele or building expertise in a niche. There are many other reasons why you may work for less than your going rate but these are the most common.

This rate calculator is great at returning a numerical starting point for determining what you should charge. However, it doesn't take into account market variables like your experience, current price trends, project requirements and a dozen other important things. Those are all elements that you'll have to add or subtract when bidding or quoting a price to a client. Short of consulting with you during each and every project negotiation, there's no way for me to tell you what you should charge for extra services. As with many other things in the freelance writing business, you'll have to learn that as you go.

Hopefully this freelance writer's rate calculator will give you a starting point for determining what to charge for your services. The most important thing to remember is to not undersell yourself. You are offering a valuable service that others either cannot or will not provide. Earn what you deserve as a freelance writer. 




8 comments :

Kunal said...

Nice calculations. Reminds me of my days as a Project Manager. However, in real life, this can be rarely achieved.

Most freelance offers are sub-tendered, For example, someone bids for and wins a job of writing a bunch of articles. Now, he looks for a writer who can do the job for him at half the rate initially offered. This goes on until the rate reaches about $1/500 words or even less.

Even at $4/100words, no one cares for your bid at oDesk, Elance, Guru, Freelancer and other sites. Try it and see.

Michael Davis said...

That's why I stopped using Elance (Freelancer) well over 4 years ago. You're going to get low-balled to death. I have clients that pay as low as .06 cents per word and up to .12 cents per word. All the market rate rags tell you "Oh the going rate for a web writer of blogposts is .35 to .60 cents a word for a person of middling experience and up to a dollar per word for highly skilled writers". Well if clients are paying that, then I am looking in the wrong place. However, I have a couple clients that order consistently every week at .12 cents per word. That is fine with me. It allows me to reach an hourly rate of around $35 to $40 which is exactly what I need to reach my annual goal. It can be done, you just ain't gonna find those clients on a bid site like elance. Those clients are found almost exclusively through queries and job boards like ProBlogger and FreelanceWriting and sometimes FlexJobs and even Craigslist. The thing of it is, it's a helluva time suck for not much return. It just takes patience, tenacity and running A/B experiments on your query and proposals. Kind of hard but possible when you query dozens of people a day. Oh, I forgot one other often overlooked resource for clients, your hometown directory. Landed two over the last 3 months that pay well and order regularly. Diversification, my man, and don't waste your time on bid site, you can waste your time elsewhere with a better chance of actually landing a big fish.

Michael Davis said...

Kunal, why don't you hop over and join our little forum? Come be a part of our family and we'll succeed together. No doubt, the Freelancer's Community Co-Operative is just that: A Co-Op of Freelancers dedicated to succeeding and doing it as a united front! We can help you and you can help us and it is a nice little circle of helpfulness.

That goes for any freelancer whether you're a writer, a designer, a developer, a marketer etc etc, that reads this message or finds the forum. If you proudly claim freelancer, come and join us! It's FREE so you ain't got a damn thing to lose!

Kunal said...

Hi Michael, I have joined your forum. I like the look and getup of your site.

Michael Davis said...

Kunal!

Awesome buddy! Welcome aboard. Make yourself at home and don'yt hesitate to start a discussion or ask a question. As you can see, the forum needs all the activity it can get!

Kailash Ultimez said...

This article is very valuable and specific explanation, I like it!
Thank you for sharing a great article.
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Michael Davis said...

Glad you enjoyed it friend! All success to you!

Lee said...

Pointed tips are really useful, it is critical to focus attention on the most important things you want to bring to your reader.
In case you follow all these instructions it would be easier to find your auditory and offers to earn money. To make it even more easy register here and get your job!