Story: Learn from failure
In May 2016, I’ve started freelance as graphic designer. Fortunately, I had enough work through networking. I had an experience to send an estimate at an advertising agency. However, I was not sure how much I can charge for my service. Before that, I hesitated to talk about money.
Most of freelance faces this issue, money talk. We have to evaluate our service at the local market somehow. The Futur taught me how to decide the price, hourly or value, how to talk about money. It calls business of design.
I feel better than before now. I don’t much afraid about rejection. I sometimes got complaints from the client during this learning process. I lost a couple of clients. These experiences were necessary for me. I charge what I evaluate myself compared to other freelance, agency and the market. I can provide value more than an average designer. Once a client admits it, I dedicate everything that I can do. I am not a designing maker. I solve a client’s problem. I focus on the client’s business growth.
I cannot compromise a certain amount of a fee. If I am the cheapest, I can get projects, but it’s unsustainable. Therefore, I learn how to talk about money with the client.
How To Talk To Clients About Money & Budget
©️The Futur
Example: The budget is too low. How do you it without losing the job?
– Feel, think and react. The tone in which you say something will dramatically impact how the person receiving it. Don’t react immediately.
Pricing Design Work & Creativity
©️The Futur
— Think about the value to the client.
– You price the client and not the job.
– The hourly rate does not make sense for creative work.
– Most business people value time.
– What criteria would you use for determining?
– You have to believe that this is what it’s wort and it has to relative to the risk of the company.
– The clients don’t choose the best option. The clients choose the least risky option.
– How much impact does your work have?
Pricing Creativity w/ Blair Enns Livestream
©️The Futur
– Author of the win without pitching manifesto.
– Specialized. Expertise.
– See opportunity in the markets.
– We address issue talk of money early.
– Embrace silence.
– How do you measure the success you are promising?
– In business, all profit comes from risk.
– You get paid 3 things, what you do, what you own, the risk that you take.
– Price buyer and value buyer.
– The first level of success, hard work and saying yes to everything.
– The second level of success , saying no everything. innovation and take a risk.
– At 31:00, he mentions the process of growth above 2 points.
– The Value is subjective.
– W thank-you moment.
– If the client pays for it, and you are creating value well beyond that, time does not matter.
– 3 things you can sell, time and material, out of deliverable, or outcome of value.
– Price the client, not service, offer options and anchor high.
Hourly Billing Is Nuts— Stop Trading Time For Money
©️The Futur
– Hourly pricing is not billing.
– How does the client satisfy the result?
– What is the worst scenario?
– Send a proposal with 3 options.
– Start working some profit into your income stream.
– Calculate costs, 10% of annual value for client.
– The value is subjective. Don’t hesitate to charge as a professional.
– We can value pricing to high-risk projects.
– Talk with decision-makers, not a gatekeeper.
– 3 price strategy. High price requires more ownership and responsibility for the project.
– 3 steps. Make sure with client, outcome, guarantee(what the client gets), then price. Don’t think about how long you work. The price should be beyond that.
– You have to be unique and different.
– Never convince the client, just ask the right question.
I don’t work for money. I want to contribute to the client’s business. Through the process, I would like to spend a good time. When you bit low, you will complain about some points during a project. I totally avoid that. A negative mind brings you to the next negative situation. This is not just cliche.
5 Tips On How To Talk To New Clients
©️The Futur
– At 4:44, Chris shows a chart. 0-5k, 5k-30k, 30K-200K, and Over 200K.
– 50% payment front.
– Ask, were you able to determine what your customer’s pain points/challenges are? Why don’t they buy/use your product or service? Did you write a user journey? What did you learn?
– Show, don’t tell.
How To Talk About Money With Clients Ep.2/4
©️The Futur
– Appreciation > respect time > ask budget, requirement and schedule
– Before a new client contact you, you don’t have a job. You loose nothing.
– I cannot believe new clients come from Pinterest though.
How do you Estimate the Cost of a Project?
©️The Futur
How do you budget for potential challenging?
I don’t apply this structure right at the moment. Too many people involved in a project. In addition, Chris does not mention about a designer, only artist. Under art director, normally someone has to work as a designer. It depends on what kind of projects, how to use the art work for.
Never Discount To Get Sales—The Right Way To Trigger Sales
©️The Futur
Exception of discount
– Royal customer. (not the first customer)
– Contract multiple projects right now.
– Test launch. (Kickstarter)
– Pre-launch.
– If you pay a fee within X days, get a discount of 2%.
– Reverse sale,
– Price anchoring, scarcity, in terms of time.
How To Run A Profitable Business & Make Money
©️The Futur
How much does this thing cost?
Cost – Measured in time(effort) + materials
Price – Determined by cost + profit
How much profit do you include in the price?
High return high risk, low return low risk.
Who decide a price, seller or buyer? – Seller
Who decide a value, seller or buyer? – Buyer
When value exceed the price, people pay money.
In 2020, what kind of income are you going to make?
Positioning. For instance, Coke at wholesale, vending machine and movie theatre.
Understand customer pain points.
The states drive our emotions.
Stop Losing Money – How to Find Your Break Even Point
©️The Futur
How do you predict your monthly income?
– Break-even point = Total fixed cost / Gross profit margin(50%)
– No need to do. Once you know it, you can motivate yourself to achieve a goal.
How can you figure out what you need to charge for it to be profitable?
– Profit = revenue – expense
How much safety net/ runway should the small agency have saved?
– Put away at least 6 months operating overhead.
How Do I Raise Prices Without Losing Clients?
©️The Futur
It is difficult to raise prices on the repeat customers.
– Every time a new customer comes in you must raise your price.
– Position as an expert, not a service provider.
– Supply and demand.
– Don’t suppress your own value for your client.
– Say no.
– $1 = 1 thank you note.
– Double your price without explanation.
Difficult Client Role Play Who Is Fishing For A Price
©️The Futur
I am thinking about the situation. When we meet a client, they want to work with us. I assume that we already let the client knows the rough estimate or price range before the meeting. Otherwise, we don’t have to put us into the client’s shoes. Just waste time each other. It’s not good.
How did you know what you need? The conversation had started. Chris just listened to the client and addressed what he heard. even price comes from client. That’s why he said it was not technical. Listen and address!
How to Negotiate a Lowball Offer
©️The Futur
– Whoever says the number first wins.
– Anchor above where you expect the client to spend.
– Heuristics: A mental shortcut that allows people to solve problems and make judgments quickly and efficiently.
– Say that’s not gonna work can you come up with another number? Let them negotiate against themselves.
Conclusion: Value of service
Once you searched keywords, freelance + fee, estimate or hourly rates, on Google, you can find a lot of information. This is evidence of how many people struggle about it. A client has a choice, a strong position more than you. If they compare to others, you are not comfortable. I know the situation. I sometimes compromised.
In my opinion, please develop a position you can say no. It means you have a stable cash flow, regular work/customer. I have a couple of, but not enough. I am trying it in 2020.
You don’t have to negotiate the price with a new client. You are busy. You don’t have time. If the price is not fit you, it’s time to say no politely. How much value does the achievement have? Everyone can do underestimate. It will be a negative spiral.
Under promise, over delivery, appropriate estimate.
