Two challenges of working any freelance job are determining rates and communicating payment expectations to clients. Some freelancers are uncomfortable with money issues; others are unsure how much their skills are worth. Additionally, if you are a freelancer, it’s important to be aware of what your clients prefer. If your clients are confident you truly understand their needs, they will choose you every time they require a service. Finding the right pricing strategy is especially hard for new graduates of technology colleges. With a little forethought, those entering the field can find fast success.
Fixed Rate
A fixed rate is the most common and preferred method of charging. A recent non-scientific survey showed that both clients and designers prefer a fixed rate by an overwhelming margin. The fixed rate has a number of advantages over hourly rates or daily rates:
- Clients know exactly how much they are expected to pay.
- The price is easier to break down for upfront partial payments.
- You probably can estimate how long a project will take to complete and can price accordingly.
- Invoicing is easier.
Partial Upfront Payment
Clients are happy with making a partial payment when they hire you for the job and paying the remainder upon delivery. This is an especially good system to use when the client is new. When you are doing repeat business for the same client, you may feel comfortable receiving full payment on delivery, but this arrangement is a good way to protect your own interests.
Payment Timeliness
Laws may vary according to region, but you should expect to be paid within one month of delivering the invoice. Most clients will pay quickly, but it seems there’s always someone who needs to be tracked down. Make your expectations clear up front, and state explicitly in your contract when you expect to be paid.
Accounting
A number of excellent billing software programs are available should you choose to go that route. If you are great at record keeping, you may decide to simply track billing manually. Either way is perfectly acceptable, and people are evenly split on their preferences. Whichever way you choose, however, make sure that up-to-date and accurate billing is a priority. Your business depends on it.
Late Fee
What about late fees? If you are planning to use these as incentives for your clients to pay on time, it is crucial that you are consistent about them and that they are mentioned up front. Arbitrarily deciding to tack on late fees could put you in a legal bind.
Discount
You may also wish to reward clients who pay their bills promptly or who pay by a preferred method. For example, a client paying cash within the first 10 days of receiving the bill might receive a 5 to 10 percent discount. Like late fees, though, it’s important to keep this reward consistent and be up front about it.
The most important thing to remember is that your work is valuable. Your graphic design skill is a commodity, and one that people will pay good money for. Don’t sell yourself short. If you don’t take your billing procedures seriously, neither will your clients.
