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10 Tips for Negotiating Rates as a Creative Business Owner

image credit: AM Knizek Photo

There will always be the occasional client who wants to pay you less than you’re worth. Whether or not you choose to lower your rates for them is a very personal decision. 

However, if a client tries to get you to lower your rates and you don’t have any intention of doing so, here are a few ways to prevent getting paid less than you’re worth (regardless of the industry or niche). 

10 tips for negotiating rates as a creative business owner

1) Itemize everything involved with the project.

You can get into a lot of detail about what exactly your role is in the project, and even break down for them how much time it can take to complete various tasks.

Breaking down the project into line items can be a fantastic way for clients to see the project in a different light.

For example, they might think that by asking you to help them with website development, “all” you’re doing is website coding. However, they’re not taking into account everything else: completing assessments of their current website, considering design elements, conducting consultations with stakeholders, testing or building customized sections from scratch, and so on.

In another example, they might think that it only takes 10 minutes to create a simple logo. This is a wonderful opportunity to explain to them why simple logos can still be very complex to design. All of the steps that go into designing an awesome logo are essential and important.

2) Remind them about your experience and/or education levels.

Sometimes clients will forget that you are qualified far beyond what their in-house employees are capable of doing for this particular work—and that what you do is something they do not have the skill to do themselves.

Gently outlining your expertise can be a useful way to remind them that you are a professional and deserve professional rates.

Learn more about communicating effectively with clients

3) Point out how much money they’re saving by not having someone on payroll to do this work.

They don’t need to cover vacation days or sick time or anything like that for you—plus, you’re doing all your own admin work. You are a business: don’t let them forget that, either.

4) Let them know if your rates are market rate (or below the market rate).

It’s okay to be frank about this! If you know that your rates are reasonable and they shouldn’t expect to get a lower rate for the quality of service you provide, tell them that (diplomatically) with confidence.

You can also give them examples of other projects you’ve worked on to illustrate that your fees are something other clients were willing to pay.

5) Frame the pricing differently.

If it’s the hourly wage that’s concerning them, try framing your prices as a project-based flat rate, for example. Some clients might balk at the idea of you charging $50/hour, but are happy to pay $300 for a particular project (…even though it happens to only take you 3 hours to complete!).

Learn more about how to set rates when you grab the pricing strategy worksheet

6) Suggest removing some components of the project.

If your fees truly are out of their budget, and you would like to work on this project with the client, make recommendations about what parts of the project can be eliminated without compromising the end product. 

That way you’ll still get paid what you’re worth, they’ll still be able to fit it into their budget, and the project will still move forward.

7) Let them take the lead on the budget.

Asking your client “What’s your budget for this project?” is a handy way to let them be the one to lead the conversation about money. If they can give you a ballpark number, then you can take it from there.

8) List your rates on your website.

Posting your rates publicly—or even saying “Rates start at $X”—will enable your client to know approximately how much to expect it will cost before they even hire you

This will save both you and them a lot of time if you’re out of their budget… and it will also reduce the chance of awkward conversations.

Learn more about why you should list rates on your website

9) Include your rates in the estimate/quote, rather than saying it to their face.

Sometimes it’s easier to discuss money when we remove ourselves from the equation.

If you’re meeting with a client to discuss a potential project and they ask how much it will cost them, you might feel uncomfortable giving a specific, definitive number. Instead, you can simply say, “Let me take an in-depth look at this and get back to you.”

Another way to do this is to include the price in the estimate/quote you send them, rather than in the body of an email. Let your estimate do the talking for you so you don’t have to feel like you need to justify your rates in an email.

10) Separate out “extras,” such as rush fees.

If a client wants you to get a project turned around within four business days, then in all likelihood, you’ll be charging extra to ensure you’re compensated fairly. Make it very clear to clients what the rush fee is and why it’s in there. 

This will also help them to take you more seriously as a professional, and if the budget is too high for them, they’ll have the opportunity to suggest a longer timeframe so that they don’t need to pay the rush fee.

Where to go from here…

Now that you have the 10 tips for negotiating rates as a freelancer, make a point of deciding which of the above will be your go-to strategy for justifying your rates, if and when a client tries to negotiate you down. 

Create some standard pat answers that you can use in a given situation so it’s easy to copy and paste it into an email, or adapt it to a particular client situation. This will help you to approach clients with more ease when the topic of negotiating rates inevitably arises.

And don’t forget to grab the pricing strategy worksheet to help you choose a pricing model and set rates with confidence!

Learn more and grow your business with HoneyBook’s all-in-one crm for freelancers.

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