How To Charge What You’re Worth In Business!
How much should you get paid?
When you’re an employee, it’s a relatively easy question to answer. Go online to a site like Glassdoor and look up median salaries in your field. Factor in geographical location, and you’ll quickly find out what you should earn.
What about when you’re a freelancer or consultant with your own company? The fact is that many freelancers feel dependent on what is offered in the marketplace. They say the words “my rate is $60/hour” and then they get stuck in the cycle of being “paid dollars for hours.” And since there are only 24 hours in a day, there is a hard limit on what you can earn because you can only be in so many places at once. The truth is that you are not selling time, you are selling your expertise! Our group acceptance to behave like employees instead of consultants, to accept what is offered instead of setting our own terms, means we’re not actually getting paid what we’re worth. Speak up and share your authority in your area of expertise.
Last week, Mark Waid’s article “An Open Letter to Young Freelancers” hit the internet and then went viral. Waid clearly sets out the employee vs. consultant argument.
So: how much should you get paid? And how do you start asking for what you’re worth?
You’ve probably already done the basic exercise where you figure out how much money you need to earn, figure out how many hours you can bill to projects, and then figure out how many hours of non-billable work goes into your daily freelance career. Congratulations, you now have a freelance rate of anywhere from $50/hour to $300/hour. How do you turn that self-determined rate into actual earnings?
First, you have to figure out how to set yourself apart from the competition. No matter what industry your business is in, you must rise above your peers. My father always taught me to give overvalue. Surprise your customers by giving more than expected. They will become lifelong fans and willing to pay more because they know they can always count on your company to follow through. Follow-through is a rarity in the marketplace these days, so it’s considered quite valuable.
Secondly, charge based on the transformation you are offering, not on your time. Look at what impact your product or service is offering. How is it transforming your client’s person life, health, bank account, relationship? What is that change worth to them? In some cases, it is priceless.
Don’t get caught up in a price war because you will lose yourself in the battle. You don’t want people coming to you for a price, you want them coming to you for you and the unique star quality of your business offering. Value yourself more and others will see you and your business as more valuable. Elevate yourself and your expectations and you will start attracting the target market you love to work with…customers that love and appreciate what you do, and that receive great value and put that value to work for themselves.
Will you lose some jobs to lower bidders? Absolutely — but those are the jobs you don’t want anyway. Saying no to a ‘wrong fit’ client will only attract more of the ‘right fit’ clients.
In the end, the best way to improve your rates is to improve your work, to ask for what your work is worth, and to refuse low-ball offers. That’s the only true way to earn what you deserve.
Allison Maslan, CEO of Pinnacle Global Network, is the Wall Street Journal Best Selling Author of Scale or Fail, which is endorsed by Daymond John and Barbara Corcoran of Shark Tank. Allison’s built 10 successful companies starting out at age 19.
Now she and her team of CEO Mentors pay it forward by helping business owners scale their companies, fast-track their success, and create a more meaningful life. Pinnacle Global Network, a world leader in scaling companies and empowering business leaders has guided thousands of CEO's and Founders to success over the past decade. Allison’s been featured in Inc., Success, Fortune, Fast Company, and Forbes Magazines, is a regular contributor to Entrepreneur Magazine, and a featured expert on ABC, CBS, NBC, CNN, and Fox across the US. She is also the host and producer of The Scale or Fail Show podcast, and the Women Who Own it Podcast in partnership with WBENC, the largest certifier of women-owned businesses in North America.