Saturday, August 08, 2009


Whatever your expertise is as a creative consultant/supplier in any field of freelance service, one of your most important marketing skills is the ability to negotiate profitable fees with prospective clients. Regardless of the amount, fees should be based on what you feel your time, efforts, and talents are worth. When first starting out, make the effort to determine what other consultants are charging for similar services, and then match yours accordingly.Here are the various methods commonly used to calculate fees.Flat-Rate Charges. One way to charge for an assignment is on a flat-rate basis, meaning you commit yourself to do the job for a stated number of dollars. Clients love this arrangement, because it tells them up front exactly what they are going to have to pay. But the problem with it for suppliers is that the actual cost of most assignments is completely unpredictable at the outset. So after a fixed price is agreed to, clients often have no hesitation about changing the job requirements later on, and feel free to demand extra work from the consultant. So a fixed price for a job can end up requiring increased time and effort and much less profit for you, the supplier. If a prospect insists on a fixed price being quoted, make the best of things by presenting a "best-guess" up-front estimate of time and charges, but making clear these would be charged according to time actually spent to complete the assignment. Never quote an estimate or accept a job contract that does not allow charging for any extra work caused by repeated client changes.Page-Rate Charges: Another method of charging is based on a page rate, when you quote a certain price per finished page of a written document or segment of design. Many tyro writers and consultants follow this policy, charging widely different fees from (say) $45 to $125 typewritten page. Even if this sounds better than flat-rating, it does not decrease dangers for free-lancers. Its main drawback is that it makes no allowance for job complexity or the number of rewrites that a client demands.Hourly-Rate Charges: The best rate structure is an hourly basis in which you charge a specific number of dollars per hour. The obvious advantage is that you get paid for your actual effort. Less obvious is that hourly charging discourages clients from wasting your time. The arrangement makes clients realize they risk needing to pay out additional money for arbitrary and unnecessary late changes on a consultant’s work, or otherwise wasting billable time. Determining an hourly charge can be tricky, but it still should be based firmly on what you think your skill and time are worth. A highly skilled writer/designer/consultant for either marketing or technical projects should be able to command from $50 to over $100 an hour, depending on the going standard rates in the market either on-line or off-line. Less skilled consultants starting out may have to limit themselves to $15 to $30 an hour. However, newbies are well advised to not try to compete with the many overseas competitors who offer remarkably low fees.Miscellaneous “Plus” Charges: As a consultant, you also have to consider cost factors beyond the actual rate itself. All your directly related expenses should be billable to the client in addition to your fee charges for work you performed. Also you are entitled to hold the client responsible for expenses for outside suppliers, such as typographers, photographers, and artists. Do not pre-pay such vendor costs yourself, because if a client defaults on paying your bill, it leaves you being obligated to pay those suppliers. In the case of any client making late “rush” extra demands, remember to charge up to double your regular rates. It is best to inform your client of this early on, to cut down the number of last-minute requests and ensure you get properly awarded for last-minute efforts.In summary, just be guided by commonsense awareness that it is unwise to charge much higher or much lower than the average rate your competitors offer for the same talents and services. Many companies now hiring are becoming less impressed by low-bidders, and instead tend to select consultants who offer a mid-range price and a proven track record of experience. Consultants who quote unusually high fees seldom get hired, just as those asking very low rates are considered likely to be incapable of doing the job properly.Sidney Allinson.

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