How to: Best price negotiating tips for freelancers
With all the marvelous perks of being a freelancer, good old complications are never off the table. Having no boss around means you have to develop your own communication guidelines and know how to stand up for yourself. While negotiation skills might come naturally to some, the rest of us are left to learn the hard way. How to work on your own terms and get justifiably rewarded? We gathered some of the most practical tips to help you with that:
Know your worth
If you’re good at what you do and you know the services you provide are top quality, then your confidence needs to reflect this. For negotiations to work in your favor, clients need to sense you are calm and confident.
Do your research
There’s no point employing your best negotiating skills when you have little idea what your prospective client really needs and why. To excel in price negotiation, you need to know what the business or individual is desperate to accomplish or fix. When you know these weaknesses, you can offer your freelance services as the best possible solution instead of a cheap alternative to an agency.
Determine your minimum acceptable rate
Any freelancer should know where their bottom line is. You should never enter into negotiations without knowing the lowest equivalent hourly rate you are willing to work for. The formula you use to calculate your it should look something like this:
Charge per project
For most freelancers, there are few things that limit their earning potential more than working by the hour. It creates an income ceiling that you cannot go beyond.
If your hourly rate is $100 and you work 6 hours per day, you can never make more than $600 per day. But if you charge by the project, your earning potential is theoretically infinite.
Get them to name a price
Nothing is more valuable in negotiating rates than getting the client to reveal their budget and/or the rate that they would be happy to pay. You should always lead negotiations with the immortal question, “What kind of budget do you have in mind?”
Although a client may not give you a number to work with, any extra information can help you negotiate a better price.
When your client feels like they have got a good deal, then you know your negotiations have been successful. This type of result can only occur when you aim high with your initial quote. The high fee can then be lowered gently through haggling until it meets what they feel is an acceptable rate. However, try to avoid taking it up more than 20% of the market average; otherwise, you will face the risk of losing a client.
Don’t deny yourself the luxury of being certain. Be specific about any point that you are negotiating, especially when it comes to (pre)payment. It’s not worth your time starting or finishing the work if it’s not clear when, how or whether you will get remuneration at all.
The same goes for other negotiation points: don’t just ask for more time on a project, instead name a new date and time when the work will be due.
Learn to say no
When you remain emotionally detached from the negotiation process, you gain a strength and calmness that clients will sense and be drawn to.
Part of separating emotion from logic when it comes to negotiation is the ability to confidently say “no”. Sometimes the only sensible resolution to a long negotiation is to refuse the project.
Make a record of what was agreed upon
That one speaks for itself, but you should always have proof of your initial agreement in order to avoid any sort of misunderstandings in the future. Make notes, take screenshots, or just do whatever it takes. For example, according to the US law, emails and text messages can be used as evidence in court as long as they can be authenticated through a variety of ways. These may include the other party admitting they’re his or her texts, characteristics of the message itself and so on.