The Hidden Costs of Freelance Projects

Bidding for freelance projects is not an exact science. Especially when starting out, we can accept a rate for a project and then realize that we’ve actually undercut ourselves by not taking into account all of the little extra things we do on projects that we don’t count on the bid. Here are a few examples of costs we may forget to think of when pricing a job.

Mistake No. 1: The Cost of Research

When I first started freelancing, I was happy to get a gig writing 100 articles on an aspect of the finance industry. As many new freelancers do, I hunted around for what I thought was a suitable rate per article, placed my bid and was very pleased when I landed the gig. However, by the end of it, I wished that I had charged more. Because of the specifics of the job and demand that the content needed not to flout restrictions about financial probity, I had to do a lot more research on the topic than I would have normally. – That took considerable time; time that I wasn’t being paid for. Of course, I completed the job for the agreed rate, but I never made that mistake again.

Solution: Include a couple of hours of research time when you’re deciding what to bid; more if it’s an unfamiliar subject.

Mistake No. 2: The Cost of Communication

While it would be wrong to charge your client for communication that’s in the normal run of business (things like submitting progress reports and confirming receipt of project details), communication on some projects can spiral out of control. Micromanaging clients or those with whom you haven’t worked out a clear brief can mean you spend extra time on emails, reports and phone calls — and that time is a cost, too.

This was one I learned from an older, wiser freelancer when I was new to the game. We met to discuss a project, concluded the meeting successfully and worked out a project price. Then she said: “And don’t forget to add on an hour for travel and the time spent at the meeting.” That was all it took to remind me to include a missing piece of the bidding pie. Remember, if you are on the phone or in a meeting with one client, you are not actually earning money unless you have included that time in your bid.

Mistake No. 3: The Little Extras

There are always extras in every freelance job. For writers, it might be an extra round of revisions because there was a misunderstanding about the brief. For bloggers, it might be the expectation that you will be on hand to answer all comments for your post. And generally, many clients like it when you give the articles you write for them a bit of social media love (unless they are ghostwritten and sometimes even if they are). Let’s be clear — all of this takes time and time is money. If this is going to be part of the package, then include some time for them in your bid. Tweeting one article might only take a couple of seconds, but what if it’s ten, one hundred or more? And let’s not forget about health insurance and tax — as a freelancer your project rate needs to take these outgoings into account.

Solution: Build in remuneration for those “extras” into your bid.

Bonus Mistake: Undervaluing Your Skills

This mistake often affects freelancers who price by the hour, rather than by the project. The more you develop your writing skills, the faster and more accurate you will get and the quicker you will be able to do a project. Pricing by the hour focuses on the time element and ignores the skill element, so you actually lose more money the better you get. When you pay big bucks to your doctor, you’re not paying for the 10 minute consultation, but for the 10+ years of training that got him to that chair. It’s the same with freelancing skills – and you’d better remember that when you set your price.

Solution: Price by the project, not by the hour.

The overarching lesson in all of this is to be clear on what a project really involves. To do that, the next time you do a typical project, write down the different steps from start to finish. Keep track of the time everything takes. Is your rate reflecting the actual time you spent? If it is, then you’re on the right track with project pricing. If not, check your bidding process again and see whether you’ve made any of these mistakes.

 

 

Related posts:

1. Understanding exactly what the client wants
2. Pricing Strategies for Freelancers – part 2
3. Questions each freelancer should ask a potential client
4. The easy way to establish your expertise using Quora
5. How to Create Laser-Like Focus when Freelancing