When I worked in the mining industry, I knew, from month to month, what my salary would be. There was a graded pay scale and, apart from hoping for an end-of-year bonus, I knew I would earn the same amount for the whole year.
Things altered dramatically when I changed careers to become a Keynote Speaker and Author. Suddenly, there was no guaranteed income. I had go out and sell myself and decide what I was going to charge for my services.
So, what was I worth?
The important thing I had to remind myself was that I chose this path because I am experienced in my field and know what I’m doing, my expertise can inspire and motivate others, I have a passion for what I do and I have an important message to share.
All of things are of value. I am value for money. Of course the nature of my engagements would vary widely. One week I might be giving a talk at a conference, in front of a large number of delegates, the next I might be addressing a group of workers in their business setting.
Not only did I have to decide how to temper my talk to fit the group, adjust to the constraints of time allocation and make sure my content was meaningful and relevant, I also had to decide what I would charge.
I have a scale to which I refer, as a general rule. But, I’ve learnt the need to be flexible. Now, I know that most of you reading this will not be engaged in the speaking profession or have to go out and talk about your latest book, but you may be a freelance worker in some other field. So, what advice can I give you to help you on the subject of selling your services on a freelance basis.
I found an article “Why Freelancers Need to Charge Based on Value” by Matthew Baker, on theEntrepeneur website, in which he references to Marion McGovern, author of Thriving in the Gig Economy, who states “The most common mistake free agents make is thinking there must be one rate for all clients. People think it’s somehow unfair to charge ABC company differently than XYZ company. This is absolutely wrong.”
Baker then offers some tips for setting effective prices: “Consider the time you will spend on prospecting clients, unbillable hours, marketing costs and upcoming vacation time. There are many online calculators who help you determine a rate that makes freelance work sustainable.
Once you know the market rate and a rate that will support you as a free agent, you’re almost there. McGovern suggests five other considerations:
- The riskier a project, whether due to the scope or aggressive goals, the more you should charge.
- The more a project allows you to deepen or broaden your skills, the more leniency you should have on price. Consider it an investment in building your business as a free agent. In the long run, you become more marketable and potentially able to command higher fees.
- The tighter the timeline for a project, the more you should charge. It’s a convenience tax. For example, you may not realize it, but Uber is much more expensive per mile than a rental car. Convenience and urgency costs a premium.
- Your daily rate should be approximately 1 percent of your annual revenue target. A marketing consultant who feels $200,000 would be the going salary for her expertise should charge $2,000 per day for her services or $250 per hour.
- Your anchor client should get a deal. An anchor client is one that pays your rent, so to speak, by giving you recurring business. Having a project year in and year out from one client is a wonderful thing. Some free agents may want to increase the fees after a few years. Unless your costs have risen dramatically, resist that impulse.”
Baker explains that taking this approach will not only enable you to have an independent career that supports your needs, but, just as importantly, addresses the needs of your clients, which is essential and he adds: “In order to stay independent for the long run, it’s important to prospect your own clients and learn how to price effectively.”
Due to the nature of my business and the various themes of my talks, I do not have as many regular clients as some freelancers, but tend to be attracting new ones. For example, last month I was the after-dinner Keynote Speaker, my topic “Ordinary to Extraordinary”, at the Conference for the International Society for the Studying of the Lumbar Spine and a week later, I was presenting a workshop on “Goal Setting and Achievement” at a Rotary District Conference.
For this reason, my fees can differ more widely. But, the point is, I’ve learned the value of what I have to offer. Also, I always ensure I will be reimbursed for my expenses, travel, food etc. and I look for the opportunity to sell my books. I will ask for a testimonial, which I can display on my website and take every opportunity to engage with delegates, other speakers and organisers. Networking is key if you are self-employed.
If you have thought of becoming a freelancer, do your homework. Do you know your clientele? Do you have a feel for the market? Do you have something extra to offer? Going it alone can be scary and challenging, but it can also be exciting, rewarding and may help you fulfill a dream.
Just make sure you value yourself and your expertise and enjoy your successes.
About the Author
Martin Parnell is the Best-Selling author of MARATHON QUEST and RUNNING TO THE EDGE and speaks on having a “Finish the Race Attitude – Overcoming Obstacles to Achieve Your Full Potential”. Martin has written for, or been covered by CNN, BBC, CBC, The Huffington Post, The Globe and Mail, The National Post, Runners World, Men’s Journal, Canadian Business, and Maclean’s.
In a five year period, from 2010 to 2014, Martin completed 10 extreme endurance “Quests” including running 250 marathons in one year and raising $1.3m for the humanitarian organization Right To Play. Find out more about Martin at www.martinparnell.com and see what he can do for you in the long run.