Category Archives: Setting rates/Getting paid

Rate rant: Don’t undervalue your work. It’s hurts the rest of us.

I saw this posted on Elance this morning: [Yes, I belong to several job boards. No I don’t actually use them unless I see something truly worthwhile, which is rare. I simply monitor them so I can write about them. Here’s one of those moments…]

Writer for Online Holistic Technology Business
Hourly: $9.99 / hr or less | Web Content
“…this is an intense interview process. If you are TRULY committed to following through, paying attention to details, and really want this job – then apply. If not, don’t waste our time…”

Intense interview process? At less than 10 bucks an hour? Who’s wasting whose time?

If you’re an American, you should be charging at least $50 per hour for writing services. Anything less and you’re undervaluing yourself – AND hurting the rest of us. Even $50 per hour is low if you’re a corporate writer, but it’s not so low that it’s an insult. Major corporations will easily pay $100 and more per hour to quality writers who have proven their worth. But, I promise there’s a reason I state $50 as the bargain basement pricing. Read on…

A copy writer at a major corporation earns about $45,000 a year. (And that person usually has to have at least an Associate’s Degree if not Bachelor’s! Imagine going to college just so you can earn a whopping $10 per hour!) Anyway, let’s say, as a self-employed copy writer, you want to earn $45,000 a year.

When you’re in business for yourself, you have other overhead to consider:

  • Health, dental, life & disability insurance
  • Payroll taxes
  • Business insurances
  • Home office expense
  • Phone
  • Office equipment and supplies
  • Website maintenance, software and other IT costs
  • Books, subscriptions, memberships
  • Travel (Oh yes you will! You’re a writer, you probably go to writer’s conferences, etc.)
  • Bank fees and interest expenses

So let’s start with the $45,000 employee’s NET pay ($35,888.58) and add in the above expenses (based on what I actually paid out in 2014). That comes to $77,475.85. Notice I did NOT include marketing costs in my list. That’s because I do business in such a way that doesn’t require marketing. But many writers do market their services so add that in if you’re one of them.

Next, let’s break that total down into hours:
$77,475.85 ÷ 52 weeks ÷ 40 hours a week = $37.24 per hour.
Will you actually get 40 hours’ worth of billable work each week? Let’s say you average 30 billable hours each week. Now you’re hourly total is $49.66. Round that up and you get $50 per hour.

That’s why I say if you’re not charging a MINIMUM of $50 per hour, you’re selling yourself short and making it impossible for the rest of us who have to compete with substandard rates.

Look at it this way: If you went to any store to purchase merchandise, would you expect an 80% discount on every item? That’s what’s happening when you accept $10 per hour on writing jobs. Just say no! There are waayy better ways to make a decent living as a writer.

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Got a niche?

In the publishing industry, you’ll never sell a book if your target audience is “everyone.” Likewise, you won’t get many large corporate customers if you claim you can write about “anything.” Even if it’s true — you’re ready, willing and able to write about any topic as long as someone is ready, willing and able to pay you to do so — it’s not the best approach to getting corporate clients.

Write what you know. You’ve heard that one before, right? It’s true! And, instead of limiting you, it will actually help you get clients.

Here’s an exercise for you. Do a Google search on “freelance writer.” How many hits did you get? A lot, right? About 14 million! If you had a website, where would it land in that list? Now Google: [a topic you know about] + “writer”. For my niche, that number drops incredibly and, more importantly, my website shows up on page one!

Here’s another reason: you can turn work around much faster when you know the subject well. You’ll spend less time researching and more time writing. Which opens up your time to take on more work. And that, my friends, can help you make even more money.

You can have more than one niche topic, but be careful about spreading yourself too thin. You will dilute the power of your niche and its ability to draw clients straight to your door.

So what’s your niche? This exercise can help you find out.

  • Who is your present employer? What is the industry?
  • For which industries have you worked in the past?
  • On which topics have you been published in the past?
  • Do you have an educational background or skill in something other than writing?
  • What are your hobbies? Do you have any special interests or fascinations in which you would find enjoyment as a writer?
  • Are there any topics that you know more about than the average person? Do people tend to ask for your advice in certain areas?
  • If you were to write a “How to” book, what would it be about?

SIZE MATTERS!

As a corporate freelancer, your clients are big corporations, not smaller businesses. I suppose the term “small” is relative — what’s small to some may be large to others. Let’s say, for the purpose of this discussion, that a small company has only one decision-maker when it comes to hiring a freelance writer.

Large companies have multiple cost-center owners, and multiple decision makers. Here’s why it’s important to choose large corporations as your clients:

Big corporations

Small businesses pay faster
Yes, you can ask a small business owner for payment in 30, 15 or even 7 days. Big corporations may make you wait 60 days for payment. But, would you rather have $1,500 in 15 days. Or $15,000 in 60 days?

Remember, big corporations have bigger budgets, bigger projects and multiple clients. They can bring you a constant stream of work, which translates to a constant stream of income. So what if the paycheck you receive today is from the work you did two months ago? You’ll get paid next month from the work you did last month. And you’ll get paid two months from now for the work you do today. You’re constantly in the pipeline.

The larger the company, the more clients you can get
You can get dozens of repeat clients from a single company. Each department operates its own cost center and budget independently of the others. So if one department pulls the plug on its freelance budget, the others are neither influenced, nor impacted, by that.

And there’s more good news; you’re not stuck working for one corporation exclusively. You can take on as many clients as you can handle — although one single company can easily fill up a 40-hour work week.

Give yourself a raise without raising your rates

Corporate freelance writers should charge flat rates

There are many pricing possibilities for writers. Magazines often pay by the word. Some corporate projects may also, such as SEO article writing or blogging. You can also charge an hourly rate. I prefer to charge a flat rate based on the project. Here’s why:

Keep in mind that large corporations are good for repeat business. The more you write for a particular company, and the more you get to know their products and preferences, the easier — and faster — the job becomes. With a flat rate, as the job gets easier and faster, you’re still charging the same rate as when it was difficult and slow.

For example, let’s say you charge $500 for a 4-page brochure. The first time you write one, you might put ten hours of research and hard work into the brochure. That’s $50 per hour.

After writing on the same topic over and over for the same company, you’ll soon whip out a page of copy every half hour. You may even be able to recycle content from a previously written piece to make it an assemble-and-edit job. You’re still charging the same $500 for the job, but now it only takes you two hours. That’s $250 per hour!

Let’s look at the opposite of that. You start out charging $50 per hour. So, after your first ten-hour project, you charge $500 for the brochure. Fast forward a year and now you know the products and can piece together a brochure in only two hours. With the same hourly rate, you’ll only earn $100 instead of the $500 you earned a year ago. To fix that, you’d have to inform your client that you’ve raised your rates to $250 per hour. <gasp!> Your client will drop you like a hot potato.

That’s the beauty of flat rates. You can give yourself a raise without raising your rates. Your clients may balk if you tell them your rate is $250 per hour. After all, the employee who hired you on behalf of his company probably earns about $30 per hour. But, he’ll gladly authorize $500 for a four-page brochure. He doesn’t need to know it only took you two hours to write it.