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Pricing Mistakes4:50 with Pasan Premaratne
Despite having a good pricing model, freelancers can still make mistakes when charging for work. In this video, we will go over some of the areas where you probably aren’t thinking about charging but should be.
When you first start out, regardless of which model you go with, 0:00 hourly or on a per-project basis, 0:03 it can be tempting to price low. 0:05 Try and stay away from this mentality. 0:08 First off, not all clients view low prices as a great deal. 0:10 You might be giving the impression that you're just not as skilled 0:14 as the competition in your area. 0:17 Avoid letting your price miscommunicate how skilled you are at your trade. 0:19 Second, it is a difficult path to try and compete solely on price. 0:24 The Internet is a global place, and a client can always find 0:28 someone to work at a lower rate than you. 0:32 You will be fighting a constantly losing battle. 0:34 Instead, charge what you think you're worth. 0:37 If your hourly rate is $60 an hour, 0:40 and you feel like you can deliver on that price, 0:42 then by all means do so. 0:45 Take your competition into account, but don't build your prices around them. 0:47 Before we conclude our discussion on price, 0:52 I want to point out a few things that might be of importance to you. 0:54 Besides deciding on a rate, designers and developers new to freelancing 0:57 can make a few other pricing-related mistakes. 1:01 When working on a project, don't charge only for the time you spend 1:05 actually creating and implementing the client's solution. 1:08 Beyond the time you spend actually working on the client's project, 1:12 there are other things that you can be charging for. 1:15 First are revisions. 1:17 You won't always get the project right the very first time, 1:19 and the client may ask for changes here and there. 1:22 Now, if these revisions are in the scope of the project, that's fine. 1:25 But for major overhauls, you should charge an additional fee, 1:28 otherwise the client will just assume that they can ask for more work 1:32 without having to pay you. 1:35 It's also up to you to communicate up-front that any revisions 1:37 outside of the scope of work will be charged. 1:40 Second, education. 1:43 If you're going to spend time educating your client 1:45 on how to use the CMS you just incorporated into their site 1:47 or teach them how to navigate the site in general, 1:50 you're spending valuable time where you could be working otherwise. 1:53 You should be billing them for any time spent on educational activities. 1:56 Lastly, for set-up. This also applies if you're managing their hosting 2:01 or any other stuff like that included in the final project cost. 2:05 Basically, anything related to the project that isn't administrative work 2:08 can and should be billed. 2:13 Also, when you charge a client, you should be able to explain your prices. 2:15 If a client questions a certain price point, 2:19 it should be easy for you to tell your client 2:21 why exactly the project costs what you have quoted. 2:24 Most clients are actually okay with paying the price 2:27 when they know what they're paying for. 2:29 It's often a problem of miscommunication than the client not wanting to pay your prices. 2:31 Finally, when you start out, you're free to choose either model. 2:36 It might be easier to calculate an hourly rate and go with it, 2:40 or you might be more comfortable with quoting a price for the entire project. 2:43 Whatever you do, you should stick with it. 2:48 Never quote a client one price and charge them something wildly different when you're done. 2:51 If the client asks for extra work that would mean increasing the price, 2:55 please discuss that with the client instead of just doing the work and charging them. 2:59 Or at least make sure that they're aware beforehand 3:03 that additional work always means further pricing discussions. 3:06 Don't simply charge because you took longer to complete the project than you thought it would. 3:11 That just means you didn't estimate the time properly 3:15 and didn't communicate that to the client. 3:17 Be as up-front as you can about anything price-related. 3:20 The key to being a great freelancer isn't just being skilled 3:24 at the technical aspects of your job, 3:27 but more about providing a great customer experience 3:30 that will make your clients bring their business to you 3:32 over any other freelancers. 3:35 Now, once you've established a rate, 3:38 don't think of it as something that's set in stone. 3:40 As you gain more experience, put together better pieces in your portfolio, 3:43 and build up a client base, 3:46 you can always re-evaluate your price to reflect your enhanced skills as a freelancer. 3:48 Time your price increases and always inform your clients that your rates are changing. 3:53 Think about when it's best to increase your rate. 3:58 You could do it at the end of the year 4:00 or when you're taking on new projects or even when 4:02 your existing contracts end. 4:04 To conclude, you can find prominent designers and freelancers 4:07 who will say that hourly pricing is the worst 4:11 as well as those who say it's the best. 4:13 Everyone has their opinion. 4:15 Pricing is not a science; it is definitely an art. 4:17 At the end of the day, it really comes down to what you feel is best for you, 4:20 and this is a happy place you will arrive at with experience and experimentation. 4:24 If you're curious on finding out what other people have to say, 4:30 check out the notes section below. 4:32 I've included a few links. 4:34 Now, there's a saying among freelancers, 4:36 that if the client's not complaining, you're not charging high enough. 4:38 Now, this doesn't mean you should annoy your clients. 4:42 But you're definitely worth more than you think you are, 4:44 and most people are often willing to pay for it. 4:47
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