Last week at three different workshops, I was asked the pricing question so I thought it was essential I write a blog post on it. As a creative who works alone it’s hard to find the right price to offer for your service, there is no set rules on how much you should charge per hour or per project. I also struggled with this question so I came up with a pricing solution, which worked for me and may work for you.
The difficulty with pricing is you don’t want to charge too much but you also don’t want to sell yourself short. One thing to remember is that your service is valuable so you need to set a rate before you go out to clients.
I attended a business start-up workshop in 2018, many businesses were selling products and were trying to figure out how much they should sell them for. The same principle works for creatives you are the product so where do you fit in the market?
Do your research
The first step to figuring out your price is to do some research into your market. What are other people charging for the same service? My first step would be to look online; some people are very open with their pricing so it’s easy to jot down some answers. However, when I was looking at freelance events managers, there wasn’t many people who showed their prices online. There was only one-way to find out, sending an enquiry as though I was a customer, although it sounds sneaky it’s essential to know what your competitors are charging.
Time is Money
In order to come up with a price you need to know how much your time is worth. How much do you want to earn per hour? When I first thought about this question the first thing I knew was, I wanted to be paid double what I am currently being paid per hour in my day job. My example of this was when I was asked to run a workshop for the Big House Company; I had to put together a proposal for the workshop, and how much I was going to charge. In all honesty, I had never been paid to run a workshop so I had no idea. The workshop was for half a day but I had to consider how many hours it would take me to prepare for the workshop. I rounded it up to 10 hours in total, 4 hours for the workshop, 5 hours putting the presentation together and I would be there an hour before the workshop began.
Costing your product
If you are selling a physical product, you need to work out what is the product going to be retailed at? An example would be a piece of jewellery, how much does it cost you to make the product, you then need to consider how much time it’s going to take you to make the jewellery. Take the cost price and add your hourly rate, this should give you a figure that you can work with; from that figure you can either stick with it or add more money on.
How much do you need to earn?
We all know how much money we need coming in every month in order to pay our bills and survive, you need to consider this when looking at your pricing. Also considering any materials or insurances that are associated with your business. Once you have calculated this, take your hourly rate away from the figure to work out how much work you need to attract in order to meet that figure. For example if my hourly rate was £25 and I want to earn £1500, I would need to do 60 hours’ worth of workshops in a month.
Negotiate your Rate
It would be great to be paid your desired hourly rate for every job you do, but is this realistic? Probably not. We all know what it’s like when you send over your rate and the client wants to negotiate on that figure, sometimes you shouldn’t but there are things to consider if you do negotiate.
Is this client going to be beneficial in the future? You might lower your rate for a client if it’s going to mean repeat business in the future.
Does this client have a big following? If someone has a big following on social media sometimes providing a complimentary service (always use this rather than the word ‘free’) can be beneficial for you, especially if you are a new or growing business. Always ensure there are mutual benefits and clear expectations on both sides, if you are providing a complimentary service think about what you want to gain from working with this client.
Know your worth
As freelancers / creatives there is a certain expectation that you will have to do some free work in order to build your brand or portfolio. As much as this may be true you always need to make it clear from the get go that you are offering a valuable service.
I try to encourage people to do as much paid work as possible, the reason behind this is, I don’t think creatives are paid enough or the work they do. For example, an upcoming artist will probably do more free gigs that paid gigs in a year. I know that in order to build up my credibility as a blogger / facilitator / coach I will need put out free content and run free workshops. I also understand that by doing this I will be able to promote my paid services.
Whilst doing some research for this post I came across a great website, which you can calculate your rate based on the amount you want to earn in a year, the hours you want to work and how many weeks off you want per year. Find out more info here http://www.yourrate.co/
I hope this article has helped you to understand your pricing and hopefully you now have a rough figure of what you will be charging.