Aunty Entity: Cheap Clients and a Proposition
Aunty Entity
Dear Aunty Entity,
My clients think I’m very expensive and query every invoice I send them but I’m still only earning enough money to pay the rent and have very little left over for anything else. How can I charge a fair rate for my services?
Signed, Dire Straights esq
Dear Mr Straights,
I’ll freely admit that back in the days when you could charge the equivalent of the GDP of Tanzania, the chairman’s first born and a small mountain of Bolivian marching powder for a 10 page brochure website, the average freelancer was a lot more well clad and fed.
These days, the bottom line is on service, the product and on top of all that, the client has the nerve to ask for return on investment‚ or ROI in the exulted circles – bangs per buck for the rest of us. It helps to know what other people are charging for the same services. Some people post rates on their websites, others offer a quoting service. You might want to phone around a few agencies and get a quote.
When costing a project or drawing up an invoice, remember that it’s often not just your client contact who will approve and sign this off. To list the services you offer clearly as separate line items helps to convey value for money. Make sure you factor in extras such as changes to design/build or copy and administration time. Booking couriers, attending meetings and talking to the client on the telephone and via email are all chargeable – under the catch all phrase project management.
An invoice listing the following services broken down into separate hours/costings:
- Creative concepts x 2
- Amendments to concepts
- Content/Asset management
- Artworking and image retouching
- Client meetings and project management
- Administration and courier fees
Is going to be paid a lot faster than an invoice stating:
- Creative stuff for some website with a bit of Photoshop thrown in and a posh lunch.
Also note that for a small company or freelancer, it is feasible to ask for a percentage of the fee on starting a project if you have quoted a fixed fee for the project’s entirety.
Other than that, I believe pedigree chum is the preferred brand for meatloaf….
Dear Aunty Entity,
Will you go out with me? I have two houses, a Porsche and a string of polo ponies.
Signed, Post Dotcom boomer
Dear Boomer,
Are you normally that tall or are you just sitting on your wallet?
Jeff
July 29th, 2007
Very nice!
Rajesh Shakya
July 29th, 2007
Good article and good suggestions.
Rajesh Shakya
http://www.rajeshshakya.com
helping technopreneurs to excel and lead their life!
Andy Bargery
July 29th, 2007
Be firm with every query raised by your clients. Some will do this with all contractors and suppliers as a method of controlling costs. It’s often the same as asking ‘is this the best price you can do?’ This is something as a freelancer you could try yourself to keep your costs down.
Rashid
July 29th, 2007
I’ve found that the best way to pump up the flow of cash from my clients is to create an image of success for myself (if you believe in yourself others will too). Make the client feel like they are paying for somebody who knows what they are doing, somebody who has experience in the field, and has many clients who respect their work.
You can also throw in some additional treats like: (choose 1 or more)
Free customer service
6 Month quality guarantee
10% off for customer loyalty
15% off next order
$50 referral certificate
etc.. you get the idea
no.e
July 30th, 2007
Rashid has a point. A fellow freelancer built his online presence such that LARGE corporations with matching budgets were contacting and contracting with him. Part of it was the image and part of it was past work and clients. But many contacted him were surprised to learn (if they did) that he was just one guy in an apartment. He worked long hard hours but also pulled in well over six figures.
Obviously, good service and quality work will bring repeat business and glowing referrals. This is essential, as I’ve witnessed extremely well-promoted, award-winning freelancers struggle for work without that referral network in place. It may take time and you may have to take your lumps, but it CAN pan out and your clients CAN be happy signing those checks
The $30 billion US (approximate GDP of Tanzania) easy contracts might not be out there anymore, but there IS quality work with commensurate pay to be had. It’s just a matter of putting yourself in its path.
Kevin M. Scarbrough
July 30th, 2007
I pay close attention to what clients bring in, versus how much time they use that is unbillable.
Sometimes a little “heart-to-heart-to-wallet” chat with supporting documentation with the client can help smooth over things on both sides of the table when you let them know you want more money. Especially if you have been able to keep track as to the results of your efforts!
milo
July 30th, 2007
While I understand that you want to make money with ads, but this big “Brought to you by” following ad is simply annoying, perhaps leave them in the sidebar?
Corby Simpson
July 31st, 2007
While I am expensive, I have two great techniques which allow the client the choice to reduce my rate.
1) If clients get their content to me on time, then I reduce their final invoice by 10%. We’ve all dealt with late content and it can screw up production cycles big time!
2) If I get a referral to another client that commits before the project is over, then I give them an additional 10% reduction off their final invoice.
So by allowing me to stick to a specific schedule and by providing great incentive for a referral they can work to save 20% which is win/win. On a $5k website, that’s $1000 back in their pocket!
Shane Pearlman
August 2nd, 2007
Peter & I have a system we have been developing to figure pricing. With each bid and client we consistently play with our price. We figure that its a roving number based upon demand and the project.
#1. if you state your price and they immediately agree, then you are too low. We actually hope for a small hesitation from the customer before acceptance or even down right negotiation. (then make sure you wow them)
#2. if you are turning away work consistently, you should raise your prices.
3. Ask and ye shal receive.
I was at a very low price for years and was convinced that is all the market would bare. Why would anyone pay more? Then I met a gal at our local dog park who was doing similar work and asked her what she was making. She charged 3x my rate. I choked on my own tongue. Then I figured she must be amazing or do something I didn’t. Checked out her site that night and was not impressed. It gave me the courage to go to my biggest client and tell them that I was raising prices across the board as my business had grown and I hadn’t changed my rate in years. I tentatively asked for double what they were paying me (expecting them to throw me out the door). They immediately agreed and told me I was doing a great job (sigh see #1). I have since doubled again.
Point being - get some perspective. Find some other people doing the same quality of work you are with a similar client set - see what they charge. Try a few times. Take a little risk and just ask.
BTW Corby - I love the referral idea! Will pass that on.
Shane Pearlman
August 2nd, 2007
oh and good suggestions Entity on the invoice. Check out our post on how to make a proper invoice to avoid just these kind of issues. I’ve fond a professional looking invoice with all the proper pieces often makes a huge difference. We have included an invoice template you are welcome to download and use.
Shane & Peter Inc. Blog: What goes in a Proper Invoice
Rashid
August 3rd, 2007
no.e you are right on target. I have also witnessed success stories of online entrepreneurs who have skyrocketed because they of their professional image. Thanks for the reply