king to you about the project, pursue the reasons why. Often, a lost job has to do with factors like a recent firing or the fact that the boss' nephew thought it was a terrible idea. However, if you can learn that the job went to someone else, see if you can find out why. Maybe the person had more experience, or maybe it really was the fee. It certainly doesn't hurt to ask. One Final Tactic If the client indicates that he does want to use you, but can't afford the price, Kelly has just one thing to say. "The right answer," she stresses, "is not to say, 'Okay, I'll do it for less!'". Remain calm, she advises, and indicate that there may be a way to work something out. For example, suggest that if the prospect does some of the preparation work in-house, then perhaps you could handle the rest of the project for his suggested fee; or perhaps you could do parts "A" and "B" of the project for the price the prospect suggests, and proceed with "C" at a later date. If you're just getting started or need this client for a specific credential, then in some cases, you may actually wind up doing the full project for a lower fee. (There's nothing wrong with this, you could have walked away from it but chose not to for other reasons.) However, you will have maintained your pride as well as your higher rate structure by indicating that if the prospect pays less, he's going to get a little less. Next time he hires you, you'll be able to ask the higher rate, because to his knowledge, you never cut your fee -- you just did less than you originally discussed. However, in all likelihood, your price-setting homework and project preparation paid off, and you were hired for the job. If so, put the agreement in writing, and get started. And don't forget to ask for a testimonial when you're finished... you'll be getting alot more work like this. And with the good testimonial you get from this assignment, you'll be able to get more for it! Sidebar 1: Kate Kelly's Guidelines For Establishing An Hourly Rate While there are many ways to present one's fee to the client (per day, per hour, per head, per project, etc.), each of these price structures requires that you have an hourly rate. To figure an hourly free-lance rate, you'll need to know the annual salary for a staff position of someone performing tasks similar to those you offer in your own business. Are you, were you, or do you know someone who could provide you with this figure? If so, then this mathematical formula will give you a rough estimate of what you may want to charge: 1. Annual salary divided by 52 weeks/year = weekly pay 2. Weekly pay divided by 40 hours/week = hourly pay 3. Hourly pay x 2.5 = hourly rate for the self-employed Let's suppose that on staff you were making $32,000, then: 1. $32.000 divided by 52 weeks/year = $615.00 (weekly pay) 2. $615 (weekly pay) divided by 40 hours/week = $15.00 (hourly pay) 3. 15 (hourly pay) x 2.5 = $37.50 (hourly rate/self-employed). You would likely round this off to $40 per hour, or if you were just starting out, you might round it down to $35. But you ask, why not charge just $15, the going staff rate? You need the 2.5 multiple of that figure, because you're running your own business. What isn't reflected in that $15 rate of the staffer is the compensation the worker receives through medical benefits, insurance, and vacation time. The free- lancer must cover all these costs as well as general business operating expenses, and "down" time, the time spent on administrative details. You next need to compare this figure with the going free-lance rate for your profession. To compare, check the competition informally by chatting with people in the field. (Keep your comparisons local, as rates in one area usually have little relation to those in another.) You may find a helpful "competitor" who will give you some tips, or people who do the hiring of experts such as yourself may give you some general guidelines on what they are willing to pay. You may learn that the competition is lower than you are, and if you're just starting out, you may want to bring your fee more in line with theirs. (If your work is known, of course, then you may be perfectly content with charging more than the going rate.) Sidebar 2: Double Standards Should you charge different rates for different kinds of work? As Kelly says, "Double standards do have their place." Two, or even several, rates allow you to price different aspects of your services accordingly. One business owner who provides direct mail pieces for customers is frequently asked to consult on various aspects of a client's business. While she's discovered her market will bear only a certain rate for her work on the direct mail items, she finds she can charge more for her consulting. Kelly quotes this consultant as saying, "I bring years of experience to my work, and because I've already learned about their businesses from the work I've performed for them, I provide extra insight into what they could be doing to be more successful." The consultant then adds, "Charging a higher fee for the consultation work rewards me for my expertise, and clients benefit from the fact that we circumvent the 'getting-to-know-you' aspect of consulting." Kelly points out that graphic artists who do their own design execution also generally have two fees: one rate is rater and is the rate charged for the conceptual work; the lower rate is the price charged for providing the layout. As an artist becomes more established, he tends eventually to farm out the design execution work. Your task? Accordingly to Kelly, you've got to identify all the different kinds of services you provide and group them into price classifications. As you become more well-known, specialize... and raise your prices accordingly, dropping the less remunerative aspects of your line. Resource Box Kate Kelly is rightly known as the expert who can tell you HOW TO SET YOUR FEES AND GET THEM. The new edition of her 110-page book is packed with examples, easy-to-apply formulas, and sound advice on what you need to know to get the highest fees. If you're having the slightest difficulty deciding how much to charge or how to get the fee you think yourself worth, get this resource... and use it! It's just $17.50 postpaid from The Sure-Fire Business Success Catalog, 50 Follen St., Ste 507, Cambridge, MA 02138 or with MC/VISA from (617) 547-6372. Don't forget to ask for your FREE year's subscription to this quarterly guide to over 130 ways to make your business more profitable! ____________________________________________________________________ _________ Dr. Jeffrey Lant can help you sell more of your products and services faster. Use his books MONEY MAKING MARKETING: FINDING THE PEOPLE WHO NEED WHAT YOU'RE SELLING AND MAKING SURE THEY BUY IT ($34 postpaid, 285 pages) and CASH COPY: HOW TO OFFER YOUR PRODUCTS AND SERVICES SO YOUR PROSPECTS BUY THEM... NOW! ($27.95 postpaid, 480 pages). Get both from The Sure-Fire Business Success Catalog.