4 Tips To Charge Your TRUE Worth.
So You Can Earn More Money While Making Your Clients Happier Than Ever Before!!!
I love me some Shakespeare - but let’s be honest, if he was here today, he’d have to change his muse
From ‘to be or not to be...’ To the real question hanging on every service providers' lips:
“To charge hourly or to charge by the package...”
Now I know you all want to charge by the package. But then you get stuck on the how to create the package. And then you start thinking maybe you should just start with the whole hourly thing and go from there.
Aaaand something inside you still feels like you have to charge per hour because 'how dare you charge so much for a package.'
It feels easier to sell a few hours for a few hundred bucks rather than $1000 package or heaven forbid even more... You think your clients are going to call you out on it.
So we get back to the conundrum:
“To charge hourly or to charge by the package...”
This comes up often with my coaching clients and I’ve also been seeing the question online - A LOT.
You see, as a business coach, and in my agency (yeah - when I’m not busy coaching clients, you’ll find me busy running an agency that consults to corporates) I work with a lot of freelancers - copywriters, graphic designers, videographers, instructional designers, the list goes on. So I’m used to playing both roles - client and service provider.
Ready? Let's Dive In:
Tip #1. Own Your Epic-ness.
I see many newbie entrepreneurs opening with the line of "Okay so I'm new at this and..."
Here's the thing - you never want to tell your client something that's going to make them feel like you're not going to do a great job - because why are they working with you then?
Always market yourself in terms of what you think your best skill is and then go out there and do an awesome job - and grow from there.
This doesn’t mean misrepresenting yourself as a pro in something you’ve never done before - but just because you’ve never done design as a freelance business owner before, doesn’t make you ‘new’ if you’ve been employed in design for years and you're super skilled at what you do!
And if you are a complete novice - then start with your strengths - do some work for free or discount it and build up a portfolio of work and testimonials showcasing your epicness!!
So when you do get your first paying client - you’ll know you’re hot stuff and they’ll be singing ‘This girl is on Fire...’
Tip #2. Charge For Value. Not For Time.
Charging by the hour is okay but not ideal. In the long run you want to charge on a project basis, outcome basis or on a retainer.
If you are charging hourly - you need to have a minimum no of hours you’re willing to work with a single client - because you always have to get up to speed with new clients and that takes time - which is not worth it if you’re only doing say 1hours work, but you’re spending 2-3 hours getting up to speed on your client’s look and feel.
Repeat that scenario enough times in a month and you’ll only be getting paid for 30% of the time you were working. That’s excluding the time you spent winning that client in the first place.
So how do you transition from charging hourly to value-based charging?
Always focus on the true value you provide your client.
E.g. Let’s pretend your speciality is social media content.
What value does your client get when you handle their social media content?
Sure they save time and they get beautiful social media content posted. But they get soooo much more than that.
See, anyone can charge by the hour for throwing together a few lines of copy and a pic from Canva.
But when you can truly speak to your clients pain points:
- No more overwhelm. - No more time wasted. - No more wondering what to post.
AND, more importantly, speak to their gain points: (the benefits of working with you)
- Social media content that attracts more of your ideal clients. - Social media content that actually speaks to your ideal clients, so they know you just ‘get’ them. - Increased trust and improved relationship building with potential clients. - A recognisable and memorable brand.Irresistible content that grows your tribe. - Increased warm leads that are easier to convert...... - Resulting in increased sales.
The list goes on... and on...
It’s not just about the 4hours you spent creating and scheduling content.
It’s about the value your clients get from your services. That’s the game changer. And it lies in your ability to communicate that value.
That’s when you book out packages that you love and your clients love because it’s a win-win!
Tip #3. Not All Hours Are Billable.
If you’re calculating your hourly rate based on what you would earn per hour if you worked a full 45 hour week (like an employee) - then you’re going to run into challenges. BIG ones.
As a business owner and entrepreneur, you don’t have a full 45 hour week to DO the work - because you actually have to RUN a business - doing things that are super important like marketing to find clients, building relationships and doing admin and finance stuff. Which means - not all hours are billable!
This is completely different to when you were an employee and you were just the DO-er.
And sure, as you grow you can (and absolutely should) outsource the admin and the finance and all that stuff, in fact - the sooner the better - so can maximize your time and grow your business faster. But in the beginning you’ll be juggling and it’s important to get your numbers right - so that you are actually making profit.
You have to know how many billable hours you can work, at a given rate, to make the income you need to earn, in order for this whole CEO thing to be worth it - otherwise, you’ll be running your own show, but it will be more like a circus - one where you’re the underpaid ring master, juggling a lot of rings.
Which means tracking time and knowing where your most precious asset goes is super important. It will show you trends on how to become more efficient and how to make more money.
The first thing we do when we’re overloading on hours, just to earn our wage, is drop the self care and the mindset. But I’ve got news for you - there’s no paid sick leave if you’re business isn’t profitable!
Which means you have to take care of yourself!!!! The health of your business depends on YOUR health which means putting you first!!! Burn out is not the recipe for success.
You absolutely need to be making the time for your mindset work, your strategy, your 'me-time', your exercise time and even your food time.
Yeah I know how us creatives are on a deadline - um yeah I think I ate last night but that was like 24 hours ago… I’ll eat in a minute - as soon as I’ve finished this…
Not anymore sister.
If you want your business to grow, it starts with knowing your numbers, tracking and owning your time and valuing your true worth.
Cause if no-one’s told you today - You’re oh-so-worth it! Tip #4 What Does Your Client Really Want?
*HINT* It’s not what you think.
Your ideal client is NOT only looking at cost. Sure it’s a factor. But it’s not the whole thing.
Because your clients' decision is also based on Value. Expertise. & Trust.
When I’m not busy coaching clients to build a better business, you’ll find me running a creative agency that consults to corporates. My agency works with a lot of freelancers, so I’m used to playing both roles - client and service provider.
So if you’re running a service based business and you've been wanting to do market research to understand your ideal clients better - here’s some insight into what your clients really want when they book a freelancer:
Three To Rule Them All:
The job will get done on time.According to the brief.At a high quality.
That is it!
Charging by the hour means, your client doesn’t know how many hours you will take to complete the project?! Which means they don’t know how much it will cost them to achieve their outcome. Which means they don't know how much to budget…And they don’t know how to calculate their ROI (return on investment)
The key is:
Your client sees you as the EXPERT in your thing: design, copywriting, finances, admin, systems etc…
So they are RELYING ON YOU:
- To guide them around timelines. - To advise them on best practices. - To share your creative wisdom.
ALL while achieving the top three things. On Time. To Brief. With Top Quality.
That way, if you deliver this faster - you win by working less. If you deliver too slowly, you’ll find yourself losing clients faster than you can say 1.2.3.
Which means, as you get more skilled in knowing what your clients need and you get faster in delivering top quality, you start to move out of the per hour charge and into value based charging.
* Remember* YOU should track your hours to measure efficiency and find room to grow. But your client should measure your success on output and value.
Of course, if your clients aren’t thinking this way yet - then it’s your job to show them the value of outcomes vs hours.
Because the client doesn’t win when they just get hours. Nor do you.
So let’s do a re-frame shall we, and give both sides a WIN-WIN!
A Toast To You Being The Expert!!! 🙌 Champagne anyone? 🍾🥂