Youβre reading an excerpt from Art For Money, by Michael Ardelean. This small but powerful book helps every creative freelancer know their value and scale their business. Purchase the book to support the author and the ad-free Holloway reading experience. You get instant digital access, commentary and future updates, and a high-quality PDF download.
Your quote needs to be somewhere between your cost basis and the retail value of the work. That difference is your profit margin, which is the money that stays in your business savings account until you either need it for an emergency or itβs time to pay yourself a bonus, whichever comes first.
Play with margins, shooting for 50%, in your Excel model until you settle on a quote that matches the retail value of the work. Make it precise, and not too round in number.
When you put out your first quote, it is not unlikely that the client will come back to you with a startled tone and a story about budget constraints. Donβt be mad. This is part of the dance, and now itβs your turn.
You will respond with a smile and an, βOK, well letβs revisit the scope and see what we can adjust.β Your tone is unfazed and cool, because you know that there are only two outcomes, and both are good.
Outcome #1: You remove some items from the scope and allow yourself to (scientifically, not arbitrarily) reduce your price, because now youβre doing less work for less money, and the client agrees.
Outcome #2: The client canβt (or wonβt) pay even your reduced price, at which point you get to evaluate if theyβre worth working with.
You may ask, why donβt I just keep it simple and bill all my clients on an hourly basis? It seems fair and easy. Itβs not wrong to do thatβyou can incrementally raise the value of your time as you grow and improve.
However, in practice, most freelancers are not well served by billing at a simple hourly rate.
First, you are an artist, and it is highly unlikely that every single hour of your work requires the same skill and effortβor delivers the same value. For example, you might be helping a client with a new strategy for a product that could transform the company, while also doing some copy editing for the website. Billing a fixed hourly rate makes it difficult to vary your pricing based on the importance (retail value to the customer) of the work.