Freelancing Mistake #4 - Competing on Price
The Fast, Cheap, and Quality Tradeoff
It seems to make sense that a client would pick the freelancer with the cheapest rate. Who wants to spend more money when they don’t have to?
Of course, the flip side to this coin is: What freelancer wants to get paid the least amongst their peers?
There is a saying that value can be provided via three factors: Fast, Cheap, and Quality…and you can only pick two.
- QUALITY service CHEAP won’t be FAST
- FAST service CHEAP won’t be GOOD
- QUALITY service FAST won’t be CHEAP
Which of the above statements seemsmost advantageous to you**? **
Hopefully the last one since it seems you'll be paid better with quality service delivered quickly. And since you'll be doing it quickly, you can take on more projects if you want, or take more vacations.
Focusing on Fast
Getting faster at your craft is one part practice, and two parts working smarter. In our first email we talked about staying productive instead of busy. Working on the right things will get the project done much faster than allowing yourself to spend extra time on other activities.
And while every discipline is different, there are time-saving shortcuts to doing your work that are worth investing in. Remember, if you can make speed one of your features, then your price can rise accordingly.
Focusing on Quality
Of course we all strive to provide quality work, but perhaps the most important part of your business to apply quality to is prospecting new projects. Let me tell you a quick story:
I was once called upon to bid on a project. The client had let it slip that they had received two bids already, each for $20,000. On one hand I thought I could just provide a quote for $18,000 and easily land the job.
However, something that I'd been practicing lately caused me to do something different. I spent an hour and a half on the phone with a handful of board members to ask them more questions about what problems they are having with their current solution, and what success would look like with their new solution. I then went on to craft a proposal that not only outlined a precise solution to their problem (basically using their own language right back at them), sample of other work that I had done, and client testimonials. All-in-all, the document was about 14 pages long…and tailored exactly to their needs and questions.
How much did I bid? Whereas the bids to beat were each $20,000, I quoted them $30,000…and won the contract.
I found out later that the other two firms had simply exchanged emails and provided a two page document each with a price listed. The client let me know later on that my proposal process had clearly set me apart as someone who understood their problem, and that the quality of my work was going to be worth the extra money.
Stop Competing on Price
Trying to compete on price is a sure way to find yourself working long hours for the least possible pay. Taking the time to work on your speed and quality will turn that around so you can be the freelancer that works a little less, and makes quite a bit more.
What’s next?
Armed with the right techniques to make more money, now it’s time to make as much money as we can!!!! Well, that might not be a smart approach, and our next (and final) email will explore why this might be.
