How to Negotiate For a Good Pay on Freelance Contracts
If you want to get well paid for offering freelance services on contract, then you need to be a good negotiator. When negotiating for a contract, its good to have a long term perspective in mind.
In this blogpost, I will share with you my freelance contract negotiation approach. This formula has helped me to steadily raise my hourly rate from $20/hour to $125/hour. Its important to note that the hourly above is determined by many factors.
Key among them is value, competition, communication, reliability and guaranteed satisfaction.
So how can one confidently negotiate a contract and win?
Step 1; Set your Basic rate First
This is the starting point for new Freelancers. For me it was $20/hour. If the client requested me to give them a fixed rate, then it was $20 per min of video. When you are clear on the rates you charge, then, the client will show more interest in working with you.
From here, the client will start asking you questions like, what does your cost cover? Base your answer on the clients original requirement. e.g Video editing. You may then start by saying it will cover video editing and 3 rounds of revisions.
If you notice that the client is happy to pay $20/hour for video editing, think of charging them for any other request they make on top of video editing. e.g Adding background music. To begin, ask them if they are able to supply background music of their choice. Always have in handy a place you can refer them to get the music incase they don’t know.
Once you are able to convince a few clients that your rates are purely for video editing, then now, you are ready to move on to the next step.
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Step 2; Introduce a New item To Top Up Your Original Offer
If you are asked to breakdown your cost, will you be able to do so? That’s the importance of pricing each item in a project.
For example, in video production, you need many components in order to put together a video. Among the components is the source video to be edited, script, voice over(if needed), background music and animated graphics.
Price each item in the list. From there, you can have different prices with different combinations. e.g
Video editing – $20/Min
Scripting and video editing -$35/min
You see the trick? That’s how negotiation goes. Additional components doesn’t have to be done by you. You can hire a script writer and negotiate a rate per number of words. e.g $3/100 words.
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Step 3; Target Clients Willing To Pay Per Hour
Practically, you will make more money when you get paid on a hourly basis than when you are paid on a fixed price. This is because you will be paid for the time spent working on a given project.
For example, if a clients wants a 1 minute video edited. They will pay you $20 fixed. If they pay you on hourly rate, then you can negotiate. In this case, it will be unrealistic to tell a client that it will take 1 hour to edit a video unless its just cutting out unwanted sections.
So it will make sense to propose 3-5 hours and see how the client reacts. In many occasions, the client will offer to pay you for 5 hours max. This means you will be paid 5x the fixed amount.
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Step 4; Listen to Clients Feedback And Use it For Profits
In video production, before you work with some clients, they will ask if you provide scripting, animation or voice over if needed in the video. Such clients are good and love to get a whole package from one producer.
Its ok if you don’t provide. But ask yourself, can I find someone to do this and make profit out of it? You don’t have to do everything yourself. You can find other skilled freelancers to help you out.
When you find one, add a profit margin on their charges when giving a quote to your client.
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Step 5; Review Your Rates Every 3 Months
Deliver quality work and get stunning 5 star reviews. From there, review your hourly rates. You can increase it by $5 every 3 Months. In a year, you rates will have doubled. Base your rates on your expertise and experience.
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Step 6; Capitalize on Timelines
Some clients are willing to pay more for fast delivery and guaranteed satisfaction. When setting your rates, let the client know how long they will wait for the video to be delivered. e.g $20/Min and 2 days delivery. Then add an extra of say $5 for delivery within 1 day.
Have data to back yourself up when negotiating. Use the data to demand for a good pay.
And that is it from me.
How do you negotiate for a good pay? Do you have a long term formula that is applicable?
Let me know in the comments section below.
If you need help to produce professional screencast videos, request a quote here. Alternatively, you can send me an e-mail to firstname.lastname@example.org
Until next time good bye and take care.
Follow me on twitter @cheptiony.