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One of the most difficult challenges for freelance PR professionals can be figuring out how much to charge. After all, most of us are never taught how to calculate the value of our time to a customer. Because rates vary greatly based on location, experience, customer type, and specialty, we can’t tell you exactly how much you should charge, but here are a few steps you can take to make sure that you earn what you deserve.
1 - Do some market research
Your customers are likely to pay attention to the going rate in your area, so you should do the same. Some freelancers post their rates on their website, so that is one place to start. Job boards and sites like Upwork and Cloudpeeps can also be very helpful.
2 - Talk to peers
It’s a great idea to take someone who is doing similar work in your area out for a cup of coffee to find out how they price and hear about their experiences in the market. They can give you some insight into the pricing model that clients prefer.
3 - Work backward
Figure out what you would like to make in a year (within reason, of course), add any expected expenses. Then figure out how many billable hours you want to work. Keep in mind that you need to make time for non-billable time such as administrative work and business development. Then divide the total income needed by the billable hours to get a target hourly rate. For example, if you would like your salary plus expenses to total $100,000 a year and you expect to bill 20 hours a week, your target would be about $96
4 - Ask the client for a budget
It is always a good idea to get a budget from the client before you provide a quote. You can quickly determine if you are even in the same ball park and avoid leaving money on the table by setting your rate too low.
5 - Decide which pricing model works best for you and the job
There are pros and cons to each of the two most popular pricing models; project-based and hourly. Project-based pricing makes it easier to predict how much you will earn in a given time period, but it is essential to be very clear about the scope of the project in your contract. (Yes, you need a contract.) Scope-creep is a major hazard of project based pricing. Hourly pricing eliminates this risk, but makes it more difficult to project your income. It makes sense to consider your pricing approach in the context of the client and the particular job at hand.
6 - Establish value before stating a price
As with any sales effort, it is essential to build your value in the mind of the client before you throw out a price. Make sure they understand your skills, experience and specialty. Also focus on the business outcomes that will be furthered by your work. Talk about results like increased website traffic, leads, revenue and increased brand awareness. Avoid leading with output type measures like press releases, website pages, and reports.
The most important thing is to be confident in your abilities and set your prices based on what you have to offer. It is always easier to negotiate down than it is up, so don’t be intimidated and start off with a low-ball price that you’ll later regret. You’ll start a client relationship by discussing how much you’ll cost, but you’ll cement it for the long-term by showing them how much you are worth.