In freelance writing, there’s a lot of talk about how much to charge, but not nearly enough on how to charge. It sounds kind of crazy but the type of rate you use can actually increase your income. In particular, you can earn a lot more by using project rates instead of per word or per hour rates.
For the uninitiated, a project rate means one flat fee for an entire project. Let’s say you’re writing five pages of website content. In this case, your project rate would cover all five pages, as well as any additional work, like for revisions.
If you haven’t used project rates before, you’re in for a treat! Let’s take a look at why project rates are so much better.
1) Project rates are easy. No timesheets!
When you use project rates, you have one fee for one project. That’s it. You don’t have to calculate how many words you wrote or––worse––log and report your time. (I’m not a fan of hourly rates for many reasons, and having to log time is one big reason.)
Of course, you need to define the project so that the client understands exactly what the project rate includes. In other words, you need to clearly set the project boundaries to protect against scope creep (i.e., the client requesting more and more work).
2) Project rates help clients focus on the big picture.
Are you tired of demanding, micromanaging clients who breathe down your neck 24/7? Well, with project rates, you can avoid that mess. Project rates force the client to think about the entire project instead of the minutiae. When you charge hourly or per word, it’s much easier for your client to get pushy and nit-picky.
In addition, since you’ll define the project right at the start, you and your client will have the same expectations. They’ll understand what they’re going to receive from you as well as the results you’ll help them get.
3) Project rates leverage psychological pricing.
One of the basic concepts of psychological pricing is prestige pricing. The idea is that rounded prices (like $100) just feel better than more complex prices ones (like $98.30).
Likewise, using rounded project rates is easier for clients to understand than “$75 per hour” or “15 cents per word.” If you can look at the entire project, do the calculations, and say, “my fee for this project is $1,500,” you’ve covered everything. Your client doesn’t need to do any extra work to figure out the cost.
4) Project rates are flexible.
When you charge per project, it doesn’t matter how long you take to complete the project. That’s a big problem with hourly rates––the more efficient you are, the less you earn. But, with a project rate, the client is paying for results, not your time. This (along with all of the aforementioned points) means that you can command a higher rate without scaring off clients.
Want to give project rates a try? Here’s a quick crash course on how to calculate them:
If you currently charge by the hour, estimate how long a project will take you, and multiply that duration in hours by your hourly rate. So, if you charge $100 an hour and a project will take you roughly 7 hours to complete, your project rate would be $700.
If you currently charge per word, simply figure out the total word count of the project. If a client is asking for a 2,000-word article and you charge 15 cents per word, your project rate would be $300.
With both scenarios, you can add in some extra money as a buffer in the event you might run over on your time. And, since you’ll have quoted the client a project rate, any extra will simply be more profit for you.
There’s so much to love about project rates. They’re easy to calculate, they appeal to clients, and they help you get paid more. If you’re not using project rates, you owe it to yourself to seriously consider switching over.
Ian Chandler is a freelance writer and Head Instructor at Writing Launch.
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