How much do you charge? Pricing your freelance copywriting services

The perennial question: How much do you charge?

The answer’s complex.

As a freelance copywriter, you can charge whatever fee is appropriate to your skills and to the project. Therefore, when pricing a project, you’d consider:

* your experience. If you’re an experienced copywriter, you will probably know more about the project, and how to get results, than the client does. This means that by using you, the client gets added real value he couldn’t get if he used someone with less experience. This is why you charge more – because you get better results;

* the client and the project budget;

* the results, and the profit your client will make from your work (some direct mail copywriters charge a royalty, or percentage on their work);

* your desire to do the work (or your lack of desire); and

* how easy the client is to work with – does the company pay on time, or do you have to send several reminders?

The danger of low prices – you’ll go out of business
BusinessWeek.com has an interesting article “The Secrets to Price-Setting – Price is the most important factor in determining profit. Yet countless businesses fail to get their pricing strategy right”, which states:

The price you charge for your products or services is a major way you communicate your firm’s value in the marketplace. Yet many small business owners set prices arbitrarily or sheepishly follow the crowd. Jerry Bernstein, a pricing expert and founder of St. Louis-based Price Improvement Team, says getting prices right is not only important, it can make or break your firm’s profitability.

Pricing and billing is complex, because you’ll do a lot of work for clients that’s not on the clock.

The danger of low hourly rates – not every hour you work is billable
When you start out, it doesn’t much matter what your rates are, because you’ll soon discover whether you’re charging too much or too little. Aim to set your rates at what the other copywriters/ editors in your area are charging. You can assume that some of them have been in business long enough to know what they’re doing.

The first big surprise you’ll get is that although you work 40 to 50 hours a week, those are not all billable hours. As a rule of thumb, around half the hours you work are billable, so if you’re putting in 50 hours, around 25 hours will be billable.

If you’re wondering why more hours aren’t billable, the answer is what I call “pre-work” and “after-work”. In other words, there’s work you do for clients which isn’t on the clock, so to speak.

Let’s see how this works.

It’s Monday morning and by 11 am you’ve got three “Please quote” requests in your email Inbox. You read the requests, and then do research for each quote. You need more information for two of them, so you ask for that. By the end of the day, you’ve spent 1.5 hours on these quotes. You gain one job from this exercise, a month later. (The other jobs died on the vine, the clients decided not to pursue them for reasons unknown to you.)

During the day, you get feedback on a couple of jobs you’ve done recently. You spend another couple of hours fiddling around with these, answering questions, and talking to various people. You send out a news release for your own business, and look back over the work you’ve done in the past week so you can invoice clients: that’s another couple of hours.

You’re on a monthly retainer for a graphics design business, so you spend another two hours interviewing and chasing up material for a monthly newsletter for them. (Only one hour of this is covered by your retainer.)

Therefore in total, you’ve spent around 7.5 hours on Monday on necessary work which isn’t billable.

You end up working 12.5 hours on Monday, of which five hours are billable.

What can you learn from this? You learn that if you charge $60 an hour, you’re actually charging $30 an hour, because you need to cover (some of) the non-billable hours that you MUST work. Please note: you’ll never cover all your non-billable hours, and it’s useless to try. Your clients want to feel that you’re interested in them and everything they do, and that they can come to you with questions – by necessity, as a goodwill gesture, much of this work is done out of the goodness of your heart for free.

So pricing your work is something that you need to spend time considering. Take the time. There’s nothing worse than working 50 hours a week and realizing that you’re not making enough money to stay in business. If you’re a new copywriter, pricing won’t give you serious concerns in your first couple of years. You’re learning, and getting an education on the job. If you’re an established copywriter, raise your rates if you’re not charging enough.

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