As a freelancer, estimating for a job while freelancing is a big part of your work, and it’s important to get it right. If you quote an inaccurate price, you will end up working long hours for little money. When you prepare an estimate for a client, you need to be prepared for the fact that they may well challenge it and ask you to reduce your price. While negotiating is normal and is to be expected as a freelancer, you also need to stand your ground and defend your pricing structure, as you don’t want to take on work that isn’t worth your while.
We appreciate that estimating for jobs isn’t the easiest thing in the world, and it will take you time and experience to get to know what is fair and appropriate. As such, we want to share five useful tips that will boost your confidence and will help you defend your estimates for freelancing jobs that you’re hoping to take on. These tips will give you the confidence to stick to your guns and charge a price that is fair for your services. Let’s dive in and take a look at how to defend your estimates as a freelancer.
1. Undertake some market research.
Before estimating for a freelancing job, it’s vital that you undertake some market research. You can’t simply pluck a figure from the air and expect it to be accurate. While we all might like to earn $100 per hour for our work, it’s not necessarily possible! You need to spend some time researching what other freelancers charge for similar services to give you a clear idea of what your pricing structure should be. The trick here is not to be the cheapest or the most expensive. Compare as many freelancer profiles as possible within your niche and position yourself somewhere in the middle to begin with.
This is really important, as it gives you a starting point as an estimate. If you know what other freelancers charge for similar services, you can easily justify your price to your potential clients and explain to them that your rate is fairly representative of the market value. Don’t be tempted to undersell yourself just to get work, as this isn’t sustainable in the long term.
2. Know what your minimum price is for freelancing.
As a freelancer, your hourly rate is likely to be negotiable. There will be some clients that pay more for your services, and some regular clients that you might offer a discount to as a thank you for their repeat custom. Because your price will fluctuate slightly from client to client, it’s important that you work out what your minimum price is to ensure you don’t go below it when negotiating.
For instance, you might need to make a minimum of $20 per hour for the work to be viable. If this is the case, you need to factor this into your estimate. If you justify this cost to your clients, they’re likely to be understanding, as they will appreciate that everyone has a minimum price. It’s not fair to expect you to work for $5 per hour, even if they’re on a limited budget. Knowing your minimum price and sticking to it is a vital part of working out your estimates as a freelancer.
3. Articulate your worth.
Even though you might know that you’re offering value for money to your clients, they don’t necessarily see it that way. As such, when preparing an estimate, you need to articulate your worth to your client. How do you do that? Well, you need to explain to them clearly why they should employ you and why your services are worth what you’re quoting. The best way to do this is to be confident in your ability and be prepared to justify your pricing.
Breaking your estimate down into clearly defined sections and milestones and explaining the specific costs associated with each will go a long way to convincing your client that your service is worthwhile and appropriately quoted. Remember, you’re responsible for winning your own business! As a freelancer, you need to be a good salesperson, so practice working on your pitch and be prepared to articulate your worth to your clients when looking for new work opportunities.
4. Explain the associated costs and clearly state any gig extras.
Again, even though you might understand why certain things cost a specific amount of money, your clients might not know the intricacies of the market. As such, you need to be prepared to explain all of the associated costs you have included in your estimate. For instance, if you’re building a website, you could break down the costs in the following way:
- Domain name yearly registration fee: $20* Prices made up for purposes of this article and are not representative of a real-life estimate.
- Premium hosting package: $100
- Web developer hourly rate: $120 (30 p/h for 4 hours)
- Social media connection: $30
- Email inbox and personalized email address: $30
Instead of just stating something like ‘I will build your website for $300,’ listing the associated costs clearly (as above) will help defend your pricing and will show your client exactly what they’re paying for. You should also include a section in your estimate that includes optional ‘gig extras’ that clients can choose to pay for if they so desire. Being clear and transparent from the start will help you to win new business from potential clients.
5. Backup your estimate with testimonials.
It’s all very well telling your client that you will deliver an exceptional project, but how do they know you’re capable? The best thing to do is to back up your estimate with testimonials from some of your other clients. If possible, try and share testimonials from similar projects, so your client is convinced that you’re capable of the work that you’re quoting for. Sharing testimonials is an extremely effective way of backing up your estimate, as your clients will see that the price you’re quoting is for a service that is value for money and will be delivered to an exceptional standard.
Estimating for jobs is a huge part of a freelancer’s work. You will have to get used to negotiating with clients and be willing to be flexible with deadlines and, on some occasions, offer a decent discount to returning customers. That being said, don’t fall into the trap of underselling yourself just to get work. This is totally unsustainable and will cause you to stress in the future. Hopefully, these tips will help you to justify your quotes and estimates and will ensure you win freelancing contracts that help you to earn a decent living.