It is all too easy to get stuck in a money-making rut - you have a lot of freelance gigs and your business is booming yet your monthly wage stays more or less static.
For many, increasing your prices is not a viable option, particularly if you have a pretty sweet deal with your clients and you don’t want to disrupt the relationship. If this is the case, you will need to get creative with the way you approach business.
The Gift Economy
The concept is simple - rather than setting your own rates, each client decides how happy they are with the finished product and gives a gift of appropriate value in return.
Philadelphia-based web designer, Adrian Hoppel, adopted this ‘simple pricing’ method after 11 years of freelancing as a way to develop mutual trust, gratitude and a sense of fairness between himself and his clients.
“The old method is composed of two totally opposing forces: the seller attempting to take as much money as possible while giving as little product as possible, and the buyer attempting to take as much of the product as possible while giving as little money as possible.”
Hoppel hopes to go some way to changing this business dynamic. Through the gift economy method, Hoppel has actually increased his freelancing rates. Most of his clients “gift” him money in return, which usually amounts to more than he would have originally charged. This increase, he believes, is due to a mutual feeling of fairness.
Although this approach is not based on financial gain, it could save you considerable money in the long term. Similar to the Gift Economy, skill swaps work by reaching out to members of your community and offering them your services in exchange for their theirs.
For example, if you find yourself with a significant plumbing issue, you may be able to offer your marketing/IT/design services to a local plumber to help expand their business and in return they sort out your water works.
You may have to take the initiative with this one and do some research into how exactly you can help your chosen freelancer. Your local freelance network is a great place to start, however, and Freelancers Union has members who work across a wide range of disciplines.
“First-in, first-out” method
At the start of your freelancing career it is likely you took on clients for a lesser rate than you would charge today. If you find yourself in the fortunate position of having too many clients and too little time, consider ditching your stingiest clients and replacing them with a new, higher paying deal. This is an awkward move to make but could increase your monthly take-home rate significantly. Here’s how:
Client #1 - $200 per day
Client #2 - $250 per day
Client #3 - $300 per day
Client #4 - $350 per day
Average day rate - $275
Income for 28 billable days - $7,700
If we politely replace Client number one at $150 per day with a new Client #4, paying $400 per day, your monthly income would increase by $1,400 - not an amount to be sniffed at.
The blank invoice
This is similar to the Gift Economy and Skills Swap approach but is specifically cash-focused. This method is again based on mutual trust and respect. Walt Konia, writing for The Freelancery, describes a job using this method:
I said, 'Let me just concentrate on getting this done for you, and we’ll settle up later. I trust you to be fair.' She agreed.
I did the work as it came in over a couple of weeks, revising, re-writing, re-building the content. We came up with a neat and tight format, a solid voice, sharp messaging. Everybody loved it.
I then told the client to let me know what she felt was a reasonable fee for the project. It was entirely her call.
Meanwhile, I went back and parsed out the work based purely on hours spent. Had I been pricing conventionally, it would have come to 3800 to 4200 bucks, depending on how I counted.
Next day, I get an email from the client. She says “I’m thinking $9,500. How does that sound?”
I wrote her back and said “Fine. Sold.”
Konia warns this approach only works when you have a long-term relationship with a client, they know your work and most likely need to work with you again. It also works if the client has a big personal stake in the project or the project looks particularly hard to complete.
Patreon is a new initiative set up to help creative freelancers - such as bloggers, designers and youtube artists - get paid for work they put out into the public domain. It works differently to Kickstarter and other crowdfunding initiatives because it operates on a project-by-project basis. Fans of your work can set up an amount they wish to donate every time you release something new and you too can choose to donate to your favourite virtual creators.
This is a brilliant way to make a bit of extra cash, although is mostly aimed at creative freelancers and may be best suited to those who are just starting out in the field. Patreon also encourages the creative community to support one another and can help you make contacts within different fields related to your craft.
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