Latest / Freelance Careers with Fexingo: Independent Work, Consulting, and Self-Employment / How to Price Your Freelance Work Like a Consultant
Transcript
- Lucas: Alright Luna, let's talk about the one question that keeps freelancers up at night: what do I charge? Luna: Oh, absolutely. It's the single most awkward conversation we have with ourselves — and with clients. Lucas: Right. And the default answer for most people is 'I'll figure it out based on what I used to make per hour at my job.' Which is almost always wrong. Luna: So what's the better starting point? Lucas: You start with the value you create, not the time you spend. I want to walk through a specific story. A freelance copywriter I know — let's call her Jenna — she was charging $50 an hour for website copy. She was good, but she was capped. A full website package might take her 20 hours, so she'd quote $1,000. Luna: And she was probably leaving money on the table. Lucas: Massively. So I asked her: 'What does that copy do for the client?' She said it converts visitors into leads. For one client in B2B software, her new homepage copy increased their demo request rate by 40 percent. That client's average deal size was $50,000. So her copy was driving, say, 10 extra leads a month — that's $500,000 in potential pipeline. Luna: So her $1,000 fee was a fraction of the value she delivered. Lucas: Exactly. So we reframed. She now charges a flat project fee of $5,000 for a homepage rewrite, plus a small performance bonus tied to conversion lift. She still does about the same number of projects, but her annual income went from $80,000 to about $140,000. Luna: That's huge. But a lot of freelancers hear that and think 'I could never charge $5,000 for a homepage.' How do you get over that mental block? Lucas: You have to separate your self-worth from the number. The client isn't buying your time — they're buying a result. And you have to be able to articulate that result in dollars. If you can't, you're not ready to quote. Luna: So what do you say to a client who asks for your hourly rate? Lucas: Don't give it. You can say 'I don't bill by the hour. For this project, I'd quote a flat fee of $X based on the scope.' If they push, you can say 'My rate is $150 an hour, but that's not how I price projects because it doesn't align with the value you get.' You're not hiding anything — you're shifting the frame. Luna: And what about the client who says 'I don't have a budget for that'? Lucas: That's actually an opportunity. You say 'I understand. What number were you thinking?' Often they'll say something like $2,000. Then you can either negotiate scope or walk away. But you never drop your price without reducing scope. Luna: Right — because if you discount without cutting scope, you're essentially saying your time is worth less, which devalues the whole relationship. Lucas: Exactly. And here's another tactic I love: the rule of three quotes. When you're first pricing a new type of project, ask three peers what they'd charge. Not publicly — just a quick DM. You'll get a range. Then you can anchor your price at the upper end of that range. Luna: Anchoring works because the first number in a negotiation sets the tone. If you say $5,000, the client's counter will be closer to that than if you'd said $1,000. Lucas: Exactly. And you can use anchoring on the client too. When they say 'We have a small budget,' you reply 'Understood. For a smaller scope, I can do X for $3,000.' You're anchoring your own lower bound, but you're still in control. Luna: One thing I've seen freelancers struggle with is pricing ongoing retainers. How do you handle that? Lucas: Retainers should be based on the value of availability and consistency. A common model is to estimate the number of hours you expect to work per month — say 10 hours — and multiply by your effective hourly rate, then add a premium for the retainer commitment. So if your effective rate is $100 an hour, you might quote $1,200 a month for 10 hours, which is $120 an hour effectively. Luna: And you build in a clause for scope creep? Lucas: Absolutely. You say 'This retainer covers up to 10 hours of work per month. Anything beyond that is billed at $150 an hour.' That protects you. And it also signals that your time is valuable. Luna: I want to bring in a cautionary tale. A friend of mine is a graphic designer. She charged $30 an hour for years because she was afraid of losing clients. She was constantly overwhelmed with work but still broke. She finally raised her rate to $75 and lost about 20 percent of her clients. But her income went up by 40 percent because the remaining clients paid more and she had more time. Lucas: That's the classic 'raise your rates' story. And it's backed by data. A 2024 study by the Freelancers Union found that freelancers who raised their rates by at least 25 percent in the past year reported higher satisfaction and lower stress, even if they lost some clients. Luna: So the key is to raise rates regularly, maybe every 12 to 18 months, and to grandfather in existing clients at the old rate for a transition period. Lucas: Yes. And when you raise rates, communicate the value. Say 'I've invested in new tools and improved my process, and as a result, I'm able to deliver even better results. My rate is now $X.' If they push back, you can negotiate scope, but you don't have to. Luna: Let's talk about value-based pricing beyond just project fees. Some freelancers use a revenue-share model. Is that worth considering? Lucas: It can be, but it's risky. If you're a marketer who drives leads, you could say 'I'll take 10 percent of the first year's revenue from any new customers I generate.' But you need to track attribution carefully. And you need a client who's transparent with their numbers. I've seen it work well for long-term partnerships, but for one-off projects, a flat fee is cleaner. Luna: What about the psychology of pricing? How do you avoid feeling guilty for charging 'too much'? Lucas: That guilt comes from the hourly mindset. You have to internalize that your price reflects the value you create, not the time you spend. And if you deliver results that are worth 10 times your fee, you're not overcharging — you're underpricing. I'd rather have 10 clients who pay me $5,000 each than 50 clients who pay me $1,000 each. The latter is more work for less money. Luna: So the goal is to move upmarket. Target clients who understand value, not just cost. Lucas: Exactly. And those clients are often easier to work with because they're focused on outcomes, not hours. So it's a win-win. Luna: One last thing: what about using a pricing calculator or a spreadsheet to model your rates? Lucas: Yes, do that. Figure out your desired annual income, add 30 percent for taxes and benefits, divide by the number of billable hours you realistically have — say 1,200 a year — and that gives you a baseline hourly rate. Then triple it for your first project quote. That triple is your starting point for value-based pricing. Luna: Triple? That sounds aggressive. Lucas: It's a starting point. You can always come down. But if you start low, you can't go up. And you'll be surprised how often clients say yes to the triple. Luna: Alright, I'm convinced. I'm going to triple my rate for my next proposal and see what happens. Lucas: Let me know how it goes. And if they say yes, you owe me a coffee. Luna: Deal. So to summarize: anchor on value, not time. Use the rule of three quotes. Raise rates regularly. And never discount without cutting scope. Lucas: That's the framework. If you're a freelancer listening, your next step is to pick one project you're quoting this week and apply value-based pricing. See what happens.