In a freelancer’s career, there comes a time, when it becomes painfully evident that the rates charged are too cheap for the amount, quality, and level of value delivered. Raising your fees is an important component of being a more successful freelancer. However, raising your freelance rates while dealing with existing clients might be difficult because they may not appreciate the concept of having to increase their budget.
How to raise your freelance rates?
Boosting your rates from time to time is important because it means developing your skills. In this article, we’ll walk you through strategies for increasing your freelance fees without losing clients.
Clients should be informed in advance
When it comes to boosting your freelance fees, one of the worst mistakes you can make is not giving your clients enough time to process it. Take a look at these two messages, and it should be clear which one will be more effective:
- Hello, John! I’m writing to inform you that, for all new and existing clients, my charges will be increased to $0.1 per word. Best wishes!
Hello, John! I’d like to discuss reassessing my per-word rates as per our contract. For all of our projects, I’m now charging $0.09 per word. As of February 2022, I intend to raise the charge to $0.1 per word. This will be in three months, I hope you have enough time to think about this.
Those are just a few examples. The second email is important because it provides ample warning to your client, allowing him to budget in the change. It’s not only polite, but it also saves people from feeling pressured, which almost never goes well.
In the worst-case situation, raising your rates may cause current clients to drop you. If you believe your talents are worth the wage raise, then you should stick to your guns.
To be safe, always keep your portfolio up-to-date and be on the lookout for new clients.
Raise your rates periodically
One of the smarter things you can do as a freelancer is to inform potential clients that you usually re-evaluate your rates around the same time each year. That’s absolutely logical, as costs can vary greatly from year to year.
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Offer long-term client loyalty
Many clients will go through many freelancers before finding someone who can deliver high-quality work on time. That means that if a client finds a trustworthy freelancer, he’ll most likely want to work with him constantly, which is great news for you. Offering ‘loyalty’ discounts to these types of clients is a great way to make them loyal.
Since extra bonuses and prizes make customers feel valued and appreciated, loyalty programs have been shown to increase sales and keep customers coming back. The same strategy works in client services. Rewarding loyal customers creates positive feelings about your relationship, services, and fees.
As a freelancer, you can reward your clients for their loyalty in the following ways:
- Create special rates- a special discount is a perfect way to thank your clients.
- Grant a grace period.
- Clients frequently work with planned budgets that were established long before you chose to raise charges.
- Simplify the transition of existing customers to the new rates by giving them additional time.
- Make a fresh package
Some of your most loyal customers may not be willing or able to work with you at your new rates. Consider designing a new package with fewer features or more automation so that they can maintain the same level of investment.
Don’t raise your rates too quickly and sharply
If you want to build a long-term client base, try making small increases in your freelance prices, such as 5-10%. Meanwhile, there is nothing stopping you from taking on additional tasks at significantly greater pricing.
You get trusted clients who can help you build a broad portfolio using this technique, and you still get to make decent money (at least if you are good at pitching!).
Prove your worth
Some clients may want you to demonstrate that you are worth the extra money. You must dig deeper and show the client that the work you’ve done has had a positive influence on their company.
Can you demonstrate that your articles have provided value to a client’s website? Do you have numbers to prove what you did (increased engagement by X percent) and how did it benefit the customer (more website visitors signed up for the newsletter)? How many likes and shares did your client receive? How many of those likes and shares turned into paying customers?
To make your workflow smoother, take advantage of successful employee performance management software, so you can effectively contribute to the organization’s mission and purpose. It will save you time, money and simplify processes in the long run, proving your value and professionalism.
When you can show that you had a good impact on your client’s bottom line with numbers and data, you’re more likely to get past the objections and receive rate rise since you can prove you’re worth the extra expense.
Provide alternatives
If clients decide not to work with you after you raise your rates, respect their decision. They trusted you enough to employ you and give you their business; now it’s your turn to repay their faith by assisting them in finding another employee. Don’t abandon clients that aren’t willing to continue with you; instead:
- Offer other service providers who would be a good fit, as well as personal introductions.
- Assist with the transfer to the new service provider and be available to answer queries for a limited time.
Suggest upsells
Upsells are most commonly used by providing a list of other services that can be purchased in addition to the main product or service. Consider a copywriter who offers proofreading as an add-on service. Videos, audiobooks, e-books, extra services are the most common upsells.
An upsell’s purpose is to make you more money with no further work. But how can you figure out what you might be able to use as an upsell? Asking your clients what you could do to improve your service is the answer. For example, when sending an invoice, include a questionnaire asking how you may improve your service or if there is anything else relating to the service or product you provide that is missing.
Charge per month instead of per hour
Why not charge per month, or even three months, instead of per hour? Let’s say your hourly charge is $30 per hour, but you can only bill 30 hours per week since you spend so much time looking for new clients. You’ll earn $10.800 every three months this way, but if you sell your service in three-month blocks, you’ll earn $12.000 every three months by reducing the time it takes to find new clients. So, if you operate in 3-month blocks, your revenues will increase without you having to work more. Also, this method of working is suitable for any (new) client.
Additional points to consider when setting a freelancer rate
The scope of the project – A complex project will have more stringent standards and will require more sophisticated abilities, allowing you to charge a greater cost.
Education – You may be able to charge more for your services if you have an advanced degree or industry certification.
Always take advantage of helpful freelance employee apps like time tracker, to-do and planning, proposal and budget planner, email manager, project management apps, etc. Choose a useful and suitable employee app for your project and take advantage of its benefits.
Geographic location – The Upwork job marketplace connects freelancers with clients all over the world. When it comes to pricing, however, it’s a good idea to think about the current rates in your client’s area. In general, a client in France would not pay the same price as a client in China, thus tailoring your prices to the region you service is very important.
Communication is king – Communication with clients is essential. You must comprehend the client’s objectives and how your project fits into their overall plan. Effective communication will assist you in identifying ways to add value to your services or increase your service offering.
It’s critical to note that your freelancing rates should provide you with financial independence. If your rates aren’t providing you with the lifestyle, flexibility, and income you desire, it’s time to rethink your pricing approach or how you provide value to your clients.
The advantages of increasing your rates
Lower charges may generate more initial inquiries since you are undercutting your competitors, but they also attract the worst types of customers. These are the clients who will treat you as if you were a cheap commodity rather than a skilled professional.
Clients will believe you are more experienced and capable of producing high-quality work if you raise your prices. Clients are more respectful and allow you to focus on what you do best, saving you time and lowering your stress levels.
Higher rates also allow you to reduce your working hours and spend more time with your family while earning more money.
Self-assessment questions for your freelance business
There are a few questions you should ask yourself before increasing your charges. It’s important to prioritize your pricing because clients may ask why you’re increasing your fees.
Here are some examples of questions to consider while assessing your company:
- How long have you been in business?
- Has the value of the dollar changed since you established your company? Has it been affected by inflation?
- How many clients do you keep in touch with over a long period of time?
- What is your industry’s market average rate?
- Do you believe the price you’re asking currently is reasonable?
- How long have you been in business and how much experience do you have?
- Since your last rate increase, what new skills have you acquired?
- What costs have risen since you started your business? Examine your business’s equipment and operations.
- Do you value your time now more than when you first started your company?
These are just a few of the important questions to consider before increasing your freelance costs. The most important thing is to study your company, how you value your time, and how you see it in three to five years.
How to cope with rejection?
You’ve informed your clients, and sadly, some of them have declined. So, what’s next? If you follow all of the above tips and still get a negative response, you may have to accept the fact that you will lose your client, which is okay. If you have to let a client go, realize that it’s for a good reason and that you should concentrate on the ones that recognize your worth.
Conclusion
Give clients notice if you believe a rate increase is necessary. A three-month notice period is sufficient. This allows them to change their budget or find a new partner.
If you want to raise your rates, you’ll have to let some clients go. With certain long-term clients, this can be difficult and even sad. However, they are not doing you any favors if they are unable to pay you the rates you deserve and require. They’re not your friends; they’re your clients. If you don’t boost your charges, your business will never grow.
It’s critical to make sure you have higher-paying clients on board and more similar prospects in your pipeline before letting clients leave. This will eliminate the possibility of you ending up with nothing.
It’s important not to entirely cut off long-term low-paying clients when letting them go. Make it easier for them to transfer. You can achieve this by introducing them to an experienced and talented colleague who works at their usual rates. This implies that you really care about their company.
If you serve these clients well, they may either find a way to expand their budget, or they may come to you as someone they can trust when they have a more important project.
It’s easier than you think to raise your prices. Don’t let self-doubt and anxiety keep you from earning more money. Decide whether you’re willing to charge more for your valuable services right now.
When it’s time to ask clients for a higher rate, don’t feel uncomfortable or embarrassed. If the new fee is well-earned and appears reasonable, it will be well-received and well-deserved by clients. It is a good idea to work with clients who will pay you well for what you’re worth.
One more thing...
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