The Ultimate Breakdown of Pricing (And What They Don’t Tell You About Pricing)

The Ultimate Breakdown of Pricing (And What They Don’t Tell You About Pricing)

Just how much should I be charging?

The bane of every starting freelancer out there.

I remember that was the very first question that I typed into Google when I decided to turn my art skills into a freelancing career.

And it was horrendously frustrating, because this is what comes up when you search about pricing:

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But what if my operation cost is too expensive?!

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Okay, that sounds legit... but WHAT IS MY RATE.
Okay, that sounds legit… but WHAT IS MY RATE.

Oh.

My.

God.

JUST GIVE ME A NUMBER ON HOW MUCH MY WORK IS WORTH. TELL ME HOW MUCH SOMEONE STARTING SHOULD CHARGE. WHERE IS MY CLEAR PATH TO BECOMING A COMPETENT FREELANCER???

It sounds stupid now that I have written it out.

As I matured as a freelancer (you might not need to mature as a freelancer to see how unreasonable those wishes were), I realized why those articles were written the way they were.

And I get it, as an experienced freelancer reading them, I nod in my sage wisdom about how true those articles are.

Oh, yes, definitely, that’s how the young ones should freelance.

Because by the end of the day, no one can tell you how much your work is worth. After all, it’s annoyingly subjective.

And it is frustrating because all you want is a number, so all of those don’t negotiate your rate or don’t price yourself too low advice can fly over your head. What is too cheap?! What is too expensive?! How do I know?!

But I am terribly sorry. I can’t tell you what your rates are. Because I am probably not your potential client. That’s really just it. I can’t tell you the numbers because I am not the one paying you for your work.

You need to do research on your own about that.

What I can do for you is to break down on when I personally have done free work, work that didn’t paid as well, and work that paid very well. When did it worked and when did it not work. Because I’ve been there and I tried it.

Before you read this article, I heavily recommend that you do research what your market pricing is first.

Otherwise, the stuff below can fly over your head.

Why free work?

“Don’t ever work for exposure!”

If you ever ask any freelancer for their opinions, their first advice is usually to warn you against picking up projects that offers to pay you in “exposure”. There’s good thinking to that, but as it is with everything else, it is not as simple as black and white.

Why?

I am going to be honest upfront, I got my start by doing free work.

And I am not the only ones out there that got their running start due to free work.

But what I did is very carefully chosen free work.

One of the problem with the concept of free work is that there’s a bunch of opportunists that are pretending that they have exposure to pay.

And exposure is great! The problem isn’t in exposure, but the fact they are usually lying about the exposure (either they have no exposure to give or that they are actually unwilling to give exposure).

Exposure also doesn’t put food on your table.

These opportunists also doesn’t understand that if it is free, the involved artist is also not obligated to meet any standards required since the work is done as a favor.

When I first started, I worked for authors that I admired, knowing that I will enjoy the process of bring their stories to life. They also understood that as I wasn’t demanding any payment, they can’t set any standards to whatever work I throw at them.

And it worked great because we didn’t expected much from each other, but they got artwork they loved (because I did love their stories in the first place) and I got their money the next time they wanted to hire an artist.

This article by Ryan Holiday is one of my favorite about how careful you have to be about free work. He also talks thoroughly about how you should approach it and when to use the “free work” card.

Pros

  • If done right, it can be a great way to getting yourself very exciting projects that you actually love and can learn from.
  • It can actually be great for exposure. It is also a great networking method.

Cons

  • If you aren’t careful, you can literally end up in a project that’s actually just work, but unpaid.

When should I work for free?

  • If you noticed a project you really want to work on and you feel like you can deliver value to that person.
  • If you are trying to expand your portfolio while doing a little bit of networking.
  • If you are working for your own creativity.

When should I not work for free?

  • If someone is offering you “exposure” instead of pay (make sure that you are the one that makes this call, not your potential client).
  • If you have no idea what you are doing and decided to just do something random to appease a big company or a popular figure.

Why offer a lower rate?

“Make sure you get paid what you are worth.”

I am going to be slightly controversial for a second.

I will tell you why — sometimes — you want to aim for something lower than the dream rate you want to go for.

And no, it’s not because your potential clients will tell you that they can find cheaper help elsewhere.

It also won’t be because your work isn’t valuable.

The simple truth is this — charging high requires a ridiculous amount of self-confidence. Or bullheadedness.

I see many extremely talented artists and freelancers fall into this trap. They can hardly believe they can be earning premium… so they just don’t ask for it.

Also, there is a surprising amount of freelancers and artists I’ve consulted that told me how they have trouble starting because of this advice:

Get paid a high rate or don’t do it.

So I tell them that if they have trouble stating what seems to be a high price without wincing at themselves, they should simply start by charging low.

Then they gawk at me.

“I can do that?”

Yes, yes! You can charge yourself a lower rate. Yes, there’s a lot of some higher moral ground crap about how charging low is killing your fellow artists’ livelihood… but that’s all just mental bullshit.

The unspoken thing about charging high rates is that your #1 enemy is yourself.

Ramit Sethi even coined a term for something like that and how it sabotages you. He calls it mental barriers.

If you are one of those people that hesitates to start because you simply don’t feel ready to ever charge someone, start low.

Because it is better to be charging something, even if it is just $1, than sitting there and doing nothing. At least you are getting yourself started and making small progress.

There were times when I was offered projects that seemed like uncharted territories to me, so I offered a lower rate than the usual market rate. And it helps because it allowed me to genuinely figure out what my work’s value is at for that market.

Then the next time a similar project is being offered, I just increase the price. There is no problem with that.

I am going to repeat myself, but I can’t emphasize enough that you should be researching about the average pay for your service. There is comfort in knowing the solid market of your chosen market.

And by that, I don’t mean just surfing in Fiverr, because it is easy to find freelancers that charge cheap just for the sake of it. I mean research as in go out there and talk to the people that made it in your specialty. Their perspectives are priceless and they can really paint the picture on what it takes to be successful with your craft.

If you are an illustrator or artist that’s looking to work for a company in a major project (marketing, concept design, etc.), I highly recommend picking up this book (I don’t get affiliation for this). It covers almost all sort of graphic artists jobs and the average payment for the job as well as the average freelancing price.

Pros

  • Good to build your confidence — starting cheap is a good way to start building that confidence.
  • A good way to start getting the feeling of being paid and how freelancing feels like.
  • If someone isn’t sure if you are the person for the project, offering a small project to try things out can also help.

Cons

  • Attracts mostly bad clients.
  • Create a psychology barrier for you to increase your rate later on your career.

When should you price your work lowly?

  • You are just starting and you are worried you cannot deliver the value expected.
  • You have no idea if freelancing is your thing and you don’t want to owe people a massive amount of money if you fail to complete the projects.

When should you not price your work lowly?

  • You’ve been at it for awhile and you have a steady amount of clients – learn to increase your rate here.
  • You are actually confident that your work is better than the same people that charge far higher.
  • You are getting way too many low quality clients.

Why Charge a Higher Rate?

“Premium prices mean premium clients.”

This is where every freelancer’s ultimate dream is.

One big fat paycheck for one quality project.

The funniest thing is that good quality clients want that to be true too. After all, if you aren’t distracted on other projects, you are putting your best in their work. And they would pay premium for that sort of attention and care.

 

So sometimes when you are not getting customers or you noticed that potential clients seem to walk away as soon as you named your price…  maybe increasing your rates is actually the solution.

That certainly happened to me. When I charged a modest $25/hour rate for my art commissions, I got 0  sales. It was only when I took an almost reckless and desperate attempt of raising my price to $60/hour that I actually started getting clients.

Same service. Same market.

Different price created different results.

That’s why researching your pricing is important. Your market might actually have price expectations. When something matters to your clients, the last thing they actually want is a cheap service, because people don’t usually think highly on cheap services. They also don’t trust cheap services.

And you can capitalize on that.

 Pros

  • Usually gets the best quality clients.
  • You can focus on delivering better work instead of spending time and energy in outreach.
  • Clients usually have more confidence in your work if they are convinced to pay you a higher rate.

Cons

When should you price your work highly?

When should you not price your work highly?

  • You don’t actually have the technical skills to back it up.
  • You aren’t actually sure if you can deliver the results.
  • You have no idea if freelancing is your thing.

In the end, when you are deciding what’s the best rate for you, I say choose something you are comfortable with. That’s the most important part. A number you truly feel represents your work.

A number that you aren’t ashamed to say to your potential clients.

Because there’s always ways to fix your rates later. Reputations aren’t set in stone either. What is hot news today isn’t going to be hot news tomorrow. There’s also no rule or actual expectations out there that say you have to stay with the first rate you choose.

I had to fixed my rate when I first started. And I had to increase my rate later when I had a steady client base as well.

Was it awkward? Yes. Was it nerve-wrecking? Oh hell yes.

But it always did work out rather well.

Still confused and still tearing your hair out about what pricing your art is worth? I understand that it can feel very life and death and no “just set a price and try” advice can sway you from it.

I encourage you to send me an email. I might not be able to tell you the exact pricing, but I can definitely help you in figuring out how you can find the right answer.

As usual, if you know a freelancer or an artist ripping their hair out because of PRICING. Help them out, send them this article.

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