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When I started out on this freelancing career, what attracted me most was the fact that I could work from home. No more issues with traffic jams or bosses putting me under constant pressure. What hadn’t hit me though, was that I had the liberty to increase my freelance rate.
What I also didn’t count on was the guilt and the questions that followed. I asked myself, “Are you really worth this much, Sheeroh? Are you really ready to raise your rates, both hourly and fixed,? I’m sure I’m not the only one who has ever asked this question, the million dollar question: ‘When should I increase my freelance rate?’ You probably have asked the same question too. So, let’s delve into this.
When To Raise Your Rates
• When your skills and experience warrants it
I was quite excited when I landed my very first contract on Odesk. I was paid $10 for transcribing a one hour audio. You’re probably laughing right? I thought I had hit the goldmine! Wow, I could finally say that I had made money online. Nevertheless, I didn’t stop there. The more I learned and worked for other clients, the more I gained in experience and knowledge.
You’ll discover that freelancing is a field that encourages a lot of continuous reading, research and training. Therefore, four months down the line, I felt confident enough to raise my rate. When you become experienced and properly skilled, don’t be shy. It’s well within your right to increase your rate.
Don’t sell yourself short. Your client is not only paying you for your time and effort, but they are also paying for the experience as well. It is unwise to continue charging your clients the same rate as you did one or two years ago. If you do this, you’re telling your clients that you have not improved on your skill sets or worse, that you’re afraid. Do you fear that clients will run at the sight of your increased rate? Don’t let fear stand in the way of your moving forward.
• When there is a general increase in demand for your services
I’ve had a very interesting last four months on Odesk. I’ve received dozens of invites from clients for my transcription services and oh, how sweet that turned out to be. Sweet initially, but also a bit overwhelming. I came to the realization that I was working on so many projects, and that I was beginning to feel stressed-out, trying to cater to every client’s whim. Lesson learned. I decided that it would be a good idea to raise my rate (and it was about time too) and get more quality clients with far less stress.
Other freelancers offer unique products and services. It therefore follows that when the demand for these unique talents surpasses the supply of the same, you will need to consider increasing your rate. It’s not being opportunistic; it’s simply being wise. You’re merely obeying the laws of supply and demand. You’ll be working on fewer projects, so you’ll be able to give each client more of your time and attention. Fear not. Raise that rate!
• When economic indicators such as inflation take charge
Whether we like it or not, we have to grapple with the ever increasing costs of living and the rate of inflation. Our purchasing power seems to be deteriorating every now and then, and this is one of the reasons why we should increase our rate. Working from the comfort of our homes does not make us exempt from economic challenges that other non-freelancing workers face. In order to ensure that your online business remains afloat, you must raise your rate ( of course having considered the above two points)
Pointers on Increasing Your Freelance Rate
Before you do the above, please note:
1. It’s advisable to raise your rate gradually, especially when you’re dealing with clients who you’ve been working for over a long period of time. I mean, how would you like it, if the store where you normally buy your stuff suddenly increased their rate 100%, without any notice! Not a good feeling huh? Be careful not to lose loyal clients by surprising them with a huge hike in your rates.
2. Contact your clients and let them know you’ll be raising your rate. You can send them a message through the workrooms if you work on Odesk, Elance or other freelancing sites, or you can contact them through Skype, email etc. Start by thanking them for being wonderful clients and then proceed by telling them that you will increase your rate by such and such a date due to x,y,z reasons. It’s just good customer service and your clients will appreciate you for this.
In Other News
Speaking of raising rates, I was pleased to see on Odesk’s blog, a notice that from November 15, 2014, Odesk will be introducing a minimum rate of $3 in their hourly contracts. This was as a result of some freelancers lowering their rates too far in order to win projects. Me thinks $5 would have been better, but it’s definitely a step in the right direction.
Odesk has also adopted Escrow which means that for fixed price jobs, freelancers no longer have to ask for upfront fees. Why? Because employers can now submit a fully refundable deposit to oDesk. The deposit is held by oDesk until the client approves the work, and once the work has been approved, the money is released. This gives a lot of peace of mind to freelancers. Way to go Odesk.
What do you think about these changes by Odesk? I’d also like to know, what this post has inspired you to do. Is it time you raised your rate?
Feel free to share in the comments below!