Freelancing 101 Part II

For those who are brand new to freelancing there are a number of new things you must contend with. One of those is negotiating with your potential clients.  Freelancers are contractors and therefore it is up to them to negotiate the best possible contract that they possibly can. Remember, your bottom line and the bottom line of your client are almost always on opposite sides of the fence. Your bottom line grows by ensuring you get the highest possible amount for your efforts while the bottom line of your client is best served by paying the lowest possible amount for your efforts.  The challenge of course comes in finding a happy medium that works well for both of you.

Be Realistic

If a potential client has made it clear that he or she has a budget of $500 for a project and you are trying to earn $1000, then chances are very good that you are not going to be able to find common ground. In this case you will have to either make the decision to accept it or not.  There are some options that you can pursue if this is the case.  For example, you may be able to negotiate with the client that you can get credit for the work. For writers this would be a “by-line” included with the work, for programmers it may be acknowledging the contribution on the website, etc.

Do not Buckle

If you have a set hourly rate that you must earn, do not back down from that unless there is a really good reason. For an example, if you are charging $15 per hour normally and this is your rate for all assignments, if a potential client offers you $12.50 for example there may be times when you should take it.  One of these circumstances would be if the client is offering you steady work. There is something to be said for long term assignments, and it may be worth your time to take the reduced amount of pay for the benefits associated with longer term work. Remember, long term work means you do not have to spend additional time marketing or searching for new assignments.

Correspondence Matters

Keep in mind that you should keep all correspondence that involves the terms of your contract. When you do receive the contract from the client, review it carefully and make sure that the terms are as agreed.  It is strongly recommended that payment terms are laid out implicitly in the contract as well.  Milestone payments at specific times can help you avoid spending hours on an assignment and not getting paid for it.

Milestone Payments

Many new freelancers feel that it is unfair to ask a potential client for any percentage up front when they are getting involved in a new contract.  While it may not be easy to negotiate, you should try to convince the client that they should be considering 25% up front.  This allows you to start working with the knowledge that your first batch of work is paid for. A good setup that often works well is this:

• 25% up front
• 25% at 50% mark
• 25% at 75% mark
• balance on completion

This setup allows the client a comfort level and makes sure that you get paid as well. If the contract is extremely large, you may want to consider offering a smaller up front but always make sure that you will be paid 50% by the time the work is 50% complete.

Summary

For many new freelancers, the entire contract process is not only confusing but can be overwhelming. Do not let your lack of knowledge torpedo your chances of success. Stick to your guns and make sure that there are benefits to both you and your clients.

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