One of the toughest things a freelancer faces, is managing one’s schedule and allotting enough time for all the things that he or she is responsible for. This is much different than what someone at a typical day job would face. Instead of simply managing your own tasks, you have several areas that need to be covered and finding time for them all can be tricky. Especially when it comes down to “billable time”, and prioritizing tasks based on their value and necessity. Jon Hicks wrote a great article titled Why You Can Never Work Full Time, where he lists the main areas a freelancer needs to cover in order to stay-a-float.
The ones that have been particularly challenging for me lately pertain to voice communications – inquiries from prospective clients, and support for existing clients. Up until recently, I didn’t find myself picking up the phone very often, so it was never really an issue. A half hour chat once or twice a month was nothing to really worry about. But in this past month alone, I’ve easily sunk upwards of 10-12 hours into phone chats with both prospective and existing clients. Every hour I spent on the phone, was an hour of billable time lost. So, now I find myself needing to figure out a way to accommodate phone calls without losing out on work time, which translates to losing money in the long run.
Option 1 – Raise My Rate, Add Time to Projects
When I’ve talked with other freelancers about rates and scheduling, I tend to come in at the low end of the spectrum. I charge less and have a quicker turn-around. This is because I tend to handle things like new project leads and existing client support after hours, so it doesn’t interfere with my 8 hour work day. Most people will tack on a few days to the project to allow for handling of other clients and things that may come up during that time.
Over the past few years, my rate has fluctuated quite a bit. But I feel that where I’m at now is perfect. It’s higher than some, but not high enough to deter most people. Raising my rate is not something I’m crazy about.
Option 2 – Charge for Phone Calls
I really didn’t like the idea of charging potential clients for initial phone calls, until I noticed that a lot of people were using me as a consultant of sorts. They would ask to chat about their project, which was very loosely formed. We would go over details, I’d explain how I would do things, and often enough, that would be the last I heard from them. In these cases, calls would range from 30-60 minutes, which is a decent length.
Other times, a potential client would want to speak with me merely to verify my expertise. Usually, they’ve spoken to someone else and have an opinion in mind. They run the details by me, which are usually fairly technical, and it’s obvious that they’re checking to see if I know what I’m talking about. I don’t blame people for doing this, as it’s very easy to fake who you are and what you’re capable of.
In either case, I’m spending time with people which is taking me away from my current paying client. And I would say that at least half the time, I don’t hear from the prospective client again. It’s to the point now, where I’m very hesitant to accept a phone meetings until I’ve received a deposit. But many people want to chat up front for various reasons, some of which I’ve already touched on. I fully understand this, but I’m looking for a happy medium that ensures I’m able to accept phone meetings without losing out of valuable work time.
These reasons have led me to believe that charging a set fee for a prospective client phone meetings and consultations wouldn’t be unreasonable. If anything, it could open up a whole new avenue as far as billable times goes. I could schedule a few calls back-to-back at a rate that at least matches my typical rate. If I end up landing a project, whatever amount was charged for phone calls would be subtracted from the project total.
Thoughts?
I’m looking for feedback here, as I’m still not 100% this is the right thing to do. What are other freelancers doing in this situation? Are there any huge downsides that I’m not seeing to charging for prospective client calls?
24 people have had something to contribute so far.
You said you don’t want to adjust your rate but usually as a designer, your rate is how you pay for everything that happens in non-billable time. I can’t imagine “I’m going to have to charge you for this calls” going over very well.
Another option is to refuse phone calls all together for non-paying clients.
I had forgotten one little detail while writing this article which I’ve since appended to option 2 – “If I end up landing a project, whatever amount was charged for phone calls would be subtracted from the project total.” That should thwart any tire kickers, and give a little extra incentive to sticking with me for the project.
You need to make decisions about your business. Have you just created a 9-5 job for yourself? or have you created an actual business?
i.e. are you going to do *everything* and be limited by this – or are you going to “work on your business” and find a way to delegate this work to someone else.
I suggest you read – http://www.amazon.com/E-Myth-Revisited-Small-Businesses-About/dp/0887307280 – or at least seek a summary of its content.
We’ve had a bit of a back-and-forth on Twitter about this, but what you’re suggesting is changing my business practices all together. I’m not looking to expand into a full blown “small business”, but rather just finding more effective ways of handling my freelance business.
Very interesting subject here Matt! You could apply the same to meetings. I do charge for meetings – it’s my time, so I can see charging for phone calls can be a similar beast.
I’m not doing it myself at the moment, but I guess the way to do it is answer the phone, say “this sounds like something we should talk about”, book a time slot in later that week (giving client time to prepare what to talk about and for you to do some research – 10 min search on them and their business) and charge for your time.
I like the idea of you taking the charge off the final invoice after completing the project – depends on the length of the chat!
Let us know how you go about it!
Meetings aren’t a factor for me. I’ve actually never had a freelance meeting in the 4+ years I’ve been doing this. Any “meetings” are done via email or over the phone. Never in person, though. But yeah, the same thing applies. Just as you wouldn’t think twice to charge for the time you invest in scheduling a meeting with a potential client, I need to do the same for phone meetings.
Hey Matt
Sounds like you need a filtering system. You could try coming up with a questionnaire that asks all the usual stuff, eg timeline, purpose of site, what sites they like, budget etc. That will really cut down on the chit chat and allow you to address the crucial things or the missing. It could be a PDF or an online form.
I’ve found that it makes the calls a lot shorter, and it filters out the ones who aren’t very serious to hire you.
Vicki
Whoops I just found the link to your questionnaire form…It wasn’t very obvious, are people overlooking it? Maybe it could be a little more detailed?
What you can also do when prospects call you without filling in the questionnaire, is to request that they fill it up and direct them to it. Serious ones will take the time to do just that.
Yeah, I have a light-weight RFP form. No direct link in the main navigation, but it’s found on my one-page portfolio along with everything else freelance related. There’s also a big button on the homepage directing people to the form.
The details I capture in the form are enough for me to get a good idea of the client’s needs. I think any more would probably scare people off. I find that people mostly just want to know what my rate and availability are right off the bat, so I’d hate to waste their time gathering all this information only for them to find out I’m not available for 2 or 3 months. You know?
Many lawyers charge for anything beyond a client’s first consultation with them and do what you suggest, credit their account if they use them for actual work.
I would create a policy where you provide a 15 – 30 minute free consultation but anything beyond that requires some sort of deposit to continue. I would think that would encourage anyone who is just using you as a free consultant to stop it. Clients looking for someone professional would be okay knowing that the money will not be lost.
If you were in a situation where you needed to “win” clients to keep the business afloat, you might not want to go that route but it sounds like you are busy enough that you don’t want to negatively impact your future by ruining your reputation of being speedy. I think this is your best option unless you want to hire staff to field calls and talk to clients.
There have only been a few times in the 4+ years I’ve been freelancing where I needed to quickly turn prospective clients into deposits. At which points, I wouldn’t have bothered charging them for calls. But as you said, I don’t normally find myself in that situation – in fact, it’s usually the opposite. Which is why I’m having such a hard time sinking time into anything but sure things, or current clients.
Adjust your hourly rate to work in the 10-15 hours of calls per month, then spread that cost out across all of your projects from here on out. It might only end up being a 10% increase in rates.
After working freelance for three years, and now working for a design firm, I realize I drastically undercharged for every single one of my freelance projects.
We typically tend to undervalue ourselves in our pricing for fear that we might scare potential clients away…..but in the end, your work will speak for itself and a 10% (at least) bump in your prices will likely go unnoticed.
I believe I’m in the same boat. I’ve been speaking to a couple other freelancers or ex-freelancers this morning, and they couldn’t believe my rate when I told them. The thing is, with a higher rate comes a whole different type of client, and in turn, a whole different type of project. I enjoy the work I’m doing, and for the most part, the clients I’m working with. I’m nervous about stepping up to that next level and losing a fair amount of job satisfaction in the process.
While charging a fee for voice communications seems fine in a logical sense, I can’t honestly tell you that I think it’ll go over all that well. As happy as you are with the rates you’re charging, clients would much rather see a larger price tag slapped onto the project itself, rather than be charged for contacting you. Again, what you’re saying makes plenty of sense, but it’s unlikely to be perceived that way. It sucks, but that’s just how the human mind works sometimes.
If I were to go this route, I would setup some sort of page which explains why I charge for initial consultations and meetings. People that wouldn’t be okay with it, are likely not the type of client I want to work for anyway.
I don’t know about charging for phone calls, seems very off to me. Charging for meetings is great in Israel is doesn’t work and I’m not sure it works at all any where else.
About calls and everything else that is related to clients it’s some what of an issue for me as well.
Adding a couple of hours to a project I think is best and thats what I do unfortunately it only covers some of the cost. You can’t charge a client for each call or update I basically do 2 to 4 hours for project management and if they need an overview on how to use a CMS or anything in that nature I charge for that as a meeting.
Another thing that helps is I spit up all my cost into percent per project and add that to my total fee this way I know that my rate is correct the client never sees it for example I take my total cost for software that I work with Adobe suit 1K take 10% of that $10 and and add that on after ten projects I cover that cost I don’t do this for everything but it works pretty well.
matt, i’m probably the worst at not billing for my time … just ask my wife … she thinks i’m constantly giving away free advice and work.
anyway, here’s what i’ve had to do (got this tip from copywriter, bob bly) … i tell clients this …
the first 44-minute consultation is free … after that, i don’t do meetings or phone conferences. period. i correspond by e-mail only. period.
unless, of course, you want to pay me hourly for an in-person meeting, to include my travel time. i bill at $85/hour … we can talk as long as you want … :O).
it works. it’s amazing how much i get done with just e-mail … i haven’t had a client ask me for a meeting (in-person or over the phone) yet.
has this caused me to lose any clients? … none yet.
Hey Matt!
Really enjoy keeping up with your blog, thanks for being such a great resource.
I can relate, as I’m also torn on this issue at times. But I feel like the best I can do is put myself in the clients shoes. If I was thinking about giving business to this company, “what would I expect?”
I know if I’m willing to make the call, I’ve already done some due diligence. Because of this, the initial conversation is a determining factor in our future relationship. I don’t think I should be charged for willingness to engage a potential recipient of my business, and thus base my practices around this.
I’ve found you can creatively limit that initial contact, only returning non-client calls on certain days and/or certain hours, and budgeting this time into my overhead.
Having said all that, successful companies know their audience, and build their practices around that knowledge.
Which, it would appear, you don’t have any trouble with!
This was a very strange post for me to read given that I am actually somebody that would like to begin working with you. However, there are so many questions that I would need answered. For instnace, you emailed me and told gave me a range for the price that a project would cost but the range was pretty wide. The high end was about double the low end. I would need you to explain how this works. Also, I am not to savy about the design or technical matters and I have many projects that I am considering. I would want to speak to you about which ones you think you would be best at. I just hope that you remember that for inexperienced website owners it is a scary thing and it is normal that we may have questions. We too are busy, or I am for one, and can assure you that your time would not be spent in vain.
You expect a lawyer to charge you for every minute of their time and because their rates are massive, nobody wastes time with their lawyer. The expectation of designers/developers is lower, people assume a 30 minute phone call is insignificant.
I could see a prospective client balking at being charged for a consultation on their cold call. Try changing the circumstances by making a future appointment (equiv. office visit) and stating your consultation rate. Limit cold calls to five minutes. It’s a more subtle way to show your time’s value.
Lowering your consultation rate and applying it to contracts might work too, especially as a weed out.
Matt, very good topic – and one many people wrestle with. Permit a few thoughts.
One, one price does not fit all. Nor does one level of service. High touch customers should pay high touch rates. That means, high levels of interaction with you come at a premium. It doesn’t mean you charge for every little thing, including phone calls. It just means if a person wants something other than email (for instance), then it’s a higher touch service you make available with the project. For instance, could you charge a rate that included up to 2 hours of phone interaction for one price – and charge another rate for a project that only required email interaction? Sure. Some would pay for the phone interaction.
Two, initial consults may restrict you from landing clients you’d enjoy – and those you’d find profitable. In addition to a restructured questionnaire why not consider a detailed FAQ based on all the questions you’ve faced in the past? FAQ’s are a great way to help prospective clients gain a better understanding of your process. As one commenter said, not everybody understands how web design works (I know enough to be dangerous). Overcoming that trepidation and fear is your first job so you can land the clients you’d enjoy most. I’d suggest you not put a roadblock up right at the beginning, but use these tools, as one commenter said, to filter things and help prospects gain a better understanding.
Three, in addition you should consider doing a video presentation explaining how you work, how the process works and what the client can expect. Use screen capture with diagrams, or any other resources that can be put in video – to make people feel comfortable and at ease. If you direct all prospective customers to complete the questionnaire, then provide them with a written FAQ and a video message where you explain YOUR WORK FLOW – then you establish the expectation for the client right from the start. And these tools all scale. You don’t have to create them individually for every prospect. Just put the video up on your site and direct folks to it. Think of it as a pre-sale presentation you make to every prospect.
Lastly, why not consider offering high touch interaction rates in addition to design work? Clearly, you’ve got to interact with the customer so you can give them what they want. Some customers know precisely what they want (I suspect) and others don’t have much of a clue. Additionally, some may be able to articulate clearly what they want while others labor to string together coherent words. I know people who charge one rate for email “support” with a 24-hour turnaround time, and a lower amount for email support with a 48-hour turnaround (just to give you an idea). The two components to consider for pricing are: a) speed (the faster somebody needs something the more expensive it is – the faster you respond to support or interaction demands, the more expensive) and b) interaction (the higher the touch, the more it’ll cost).
Sorry for the long post. I’ve enjoyed your work for years.
Randy
Dunno if this has been covered (it’s late and I’m down for reading 21+ comments) but what you can do is this: Put a fee on proposals.
That way potential clients indicate they are serious about hiring you and serious about your (valuable time). If they aren’t serious or cheap, they will go else where. If they are sitting on the fence you can tell them … “If you hire me, I will deduct the proposal fee from the total.”
Anyways, if you are providing a proposal & estimate then they will (should) walk away with valuable recommendations contained in your proposal.
Cheers.
This was a nice look into freelance work….I love your site…keep up the great work!