Price negotiation can be one of the most frustrating aspects of a freelance designer’s responsibilities when bidding for new work. Most clients don’t realize the amount of work that can go into the simplest of projects. In this article we discuss Negotiating Your Price with Clients Unfamiliar With Design
For example, a client may commission a straightforward logo and think it only takes a few minutes to “throw” together. They may not realize that a designer spent hours researching the client’s company, industry, and other competitors before they even got started on the design.
Several drafts may have been created before the final selections were presented to the client. And many clients miss out on the most vital concept — a client isn’t solely paying for a designer’s time.
They’re also paying for the years of training and experience the designer has under his or her belt.
Designers and other freelancers are working in a competitive world right now. A growing number of people are looking to transition into freelance work to have more freedom to travel or work from home.
Market place websites sell services for cut-rate prices as low as $5, the majority offering low quality, or in a lot of cases stolen design work.
The main issues is professional designers need to compete with this low pricing stigma as clients just don’t understand the true value in value based pricing.
How can you justify the value of what you bring to the table? Read on to learn how to negotiate and set fair prices as a freelancer that you can be happy working for, as well as how to find and grow your list of customers that value your time.
Focus on Value Over Price
Prepare a presentation about yourself and what you can offer a client before you get into a pricing negotiation.
It’s critical to emphasize the value through a value proposition. Communicate the benefits your design brings instead of quantifying your services with numbers such as hours worked and typical hourly fee.
Sell the client on how you will free up their valuable time by professionally handling the job from start to finish so the client can focus on bigger-picture goals.
Remember to sell based on what’s in it for the client and how you will make their job easier.
Part of your value proposition presentation should include your training, experience, and testimonials from other clients on past deliverables.
Competing with other freelancers based on a number is a losing proposition — someone can always underbid you. Selling yourself and your services as a solution to the client’s problem is priceless.
Decide on Pricing Hourly vs. by the Project Ahead of Time
Before you bid on a job, understand the most important factor when negotiating a new contract — the type of pricing structure that would best work to your advantage.
It may take some research to learn more about the client by speaking with past freelancers who have worked for the company, or by getting a good grasp about the amount of work the project will require to determine how to bill the prospective client.
If the scope of the job is large, you may want to charge by the hour as opposed to the project. The reason an hourly fee may work better is to ensure you’re not working longer than expected for free.
If you’re familiar with the client and they tend to make many requests outside of the agreed-to contract, an hourly fee will protect you by guaranteeing you’ll be paid for any additional work the client requests.
The inverse may work best for smaller projects. If you’re familiar with the type of work you’re bidding for and know precisely how long the job will take, negotiating a flat rate may be the best option.
Naming a flat fee means demanding clients won’t have the opportunity to examine and question your fee schedule to ask for a discount or even eliminate specific fees.
Add Some Wiggle Room Into Your Fees
Everyone likes to feel as if they got a good deal or were able to save money in one way or another. Negotiation is an art — be prepared before you go into a negotiation with an idea of the lowest price you’re comfortable accepting.
Make sure your initial bid is higher than the final price you’d be willing to accept.
Adding the extra wiggle room may have two outcomes — the client agrees to your initial fees without questioning them, and you’ll be pleased with the amount.
Or if they do ask for a discount or some allowance, you know you can compromise somewhat on your pricing, so both sides are happy with the agreement.
Cut Your Losses Early
As you start growing your design business with referrals, you may find that some clients are easier to work with than others. Watch out for customers who repeatedly expect more change or attention than they agree to or who continuously complain.
They may try to renegotiate contractual terms or slide in changes to get more than what they’re paying for. It may be best to end the relationship and invest your valuable time towards other clients.
Ending a relationship is never easy. A client who is already difficult may not take well to your departure. Approach the conversation politely and have solutions ready for the client.
It may be best to send them a kind letter providing notice of the termination of your working relationship.
Neutral reasons, such as a larger workload than you can handle, or because you’re scaling back on assignments while you go back to school for new training may be some good reasons to provide.
When letting a client go, give the person some notice so that they may make alternate arrangements. Provide them with some referrals of freelancers who may be able to take over the projects.
Even if the client is not a good fit, ending the working relationship professionally and without leaving the client in a lurch can earn you a positive referral in the future.
Negotiating Is a Life-Long Evolution
Learning to negotiate your services effectively is a process. The more you negotiate, the more you’ll fine-tune and develop what works for you.
The lessons and experiences (good and bad) are all part of the job description of the freelance designer.
Take every experience as an opportunity to sharpen your negotiation skills.
We hope this article about Negotiating Your Price with Clients Unfamiliar With Design has been helpful, and be sure to leave your comments below. We would love to hear from our readers.
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Also published on Medium.