As a freelancer, having long-term clients is the dream. They provide consistent work, regular paychecks, and straightforward scheduling. But what happens when you realize you’ve been undercharging them based on your skill set and experience level?
Asking existing clients for a higher rate is challenging but not impossible. As long as you approach the topic with tact and consider how you can make it beneficial to both yourself and the client, you stand a good chance of getting what you ask for.
How to Increase Freelance Rates for Clients
Increasing your hourly rate requires a strategic approach. After all, you don’t want to end up losing valuable clients because you didn’t consider how a price increase would affect them.
While raising your rate will ultimately benefit you, how you angle your request can influence whether a client accepts it or rejects it. Try these strategies to improve your chances of having your new freelancer rate approved.
1. Take Advantage of Value-Adds
Value-adds are services and tasks that don’t necessarily have high monetary worth but that save time, share knowledge, or provide convenience to a client. Depending on your industry, they can include:
- Written guides and help documents for clients
- Small additional services at little to no cost (like providing a basic monthly performance report for free)
- Covering expenses for insignificant costs like software subscriptions
- Providing additional rounds of reviews or edits
Offering value-adds is one of the best ways to convince clients that a rate increase will actually benefit them in some way. They should be simple and straightforward for you to complete so that you don’t spend too much time on them.
When requesting a rate increase, throwing in some value-adds can soften your request because they sweeten the pot for clients. They’ll get something extra in return for paying you a higher rate, and the additional work on your end will be minimal.
2. Create Service Packages
Offering service packages is another great way to increase your rate for existing freelance clients while still offering them something in return. Packages combine common services that complement each other and work well with clients who are only paying for a base service.
Although packages can vary greatly between freelancers and industries, here are some potential combination examples:
- Freelance writers may offer packages that include one written article, up to two rounds of edits, and uploading the content to a content management system.
- Freelance graphic design branding packages might feature a logo, brand colors, fonts, and suggested styling.
- Freelance social media marketers packages can offer a monthly posting schedule including branded graphics and scheduled posts on up to three platforms.
By bundling some of your services together, you can increase the value of your work, fill out your schedule, and strike a balance between asking for a higher rate and increasing the scope of the work.
Packages work best with monthly or per-project fees as opposed to hourly rates. That way, you control the amount of money you have coming in and can increase how much you get paid without specifying an hourly amount.
Instead of asking for a rate increase from $25 per hour to $30 per hour, pitch the package as a whole by estimating how long it will take on average and what you want your new hourly rate to be. For example, offer packages starting at $500 per month that combine X, Y, and Z services.
3. Change Your Pay Structure
Sometimes it’s not how much you charge for a service that you need to change, but the pay structure that you use. If you charge a project fee, you may find that you put in more hours than you originally anticipated, meaning you’re not getting paid for all the work you put in.
Alternatively, if you charge hourly, you may find that tasks take less time to complete as your skills grow, which equates to you getting paid less for higher quality work.
Changing your pay structure is a good way to raise rates with current clients to ensure you’re not being underpaid. Review your pay structure and evaluate whether hourly or per-project pricing makes more sense for your small business. Communicate the change to existing clients at an appropriate time, such as a contract renewal, and to any new clients you take on.
4. Add a Rate Review Clause in Your Contracts
Adding a clause in your freelance contracts to review and renegotiate your current rate every so often is one of the best ways to approach regular, anticipated price increases with clients.
By communicating about potential rate changes at specified intervals upfront, like every 12 months, clients aren’t taken by surprise when you start a conversation about a new rate. This also gives you an opportunity to benefit from predictable raises, which is uncommon in the freelancing world.
Just make sure that you talk to clients about the clause before the contract is signed so they know what to expect.
5. Prove Your Worth
The more value you bring to the table, the more your existing clients will be willing to pay you. Before you begin negotiating rates with a current client, make sure you’ve successfully demonstrated your skills and abilities. If you haven’t worked with a client long enough to prove your expertise, it will be hard to convince them that you deserve a higher rate.
Your clients are likely business owners just like you, so consider how you can best use your services to meet their goals. If you show clients what you can do and prove you’re an expert in your field, they’ll want to keep you around, even when you ask for a raise.
And, they’ll be more open to giving you more money because you’ve already proven yourself to be a valuable and indispensable contributor.
6. Ask for a Reasonable Amount
When negotiating a rate increase, you have to toe the line between getting a higher rate and keeping the client on a contract. If you ask for too much, you risk having the client reject your proposal, forcing you to either stand your ground and potentially lose their business or accept a lower rate.
Before asking for a higher rate, research how much you should ask for. Consider factors like your cost of living, business expenses, and rates for similar freelancers with comparable experience in your field. How long you’ve been working with a client at the same rate will also impact your request.
Determine a baseline rate or fee that you’re willing to accept based on your financial needs and go from there.
If you started at a low rate, try to avoid asking for a huge bump, such as doubling your hourly fee. Significant rate increases are best left for new clients as opposed to your existing ones.
7. Wait for a Contract Renewal
If you have long-term clients, you probably have a contract with a renewal or expiration date. This is an ideal time to negotiate your rate because you’re no longer bound to the terms of the previous agreement.
Another benefit of lining up your request with a new contract is that you will have had plenty of time to demonstrate your value to the client and establish a strong relationship. A client who appreciates what you bring to the table is more likely to want to keep you on. This puts you in a good position to negotiate and improves your chances of getting close to what you ask for.
8. Provide a Notice Period
Unlike a full-time employee, don’t expect your raise to come into effect immediately. As a freelancer, you should provide clients with a reasonable notice period to give them time to prepare for a rate increase and to make adjustments on their end.
For example, a rate increase may need to be approved by more than one person within the company and could affect their budget. Changes also need to be communicated to and made within their accounting department.
A standard notice period for freelance rate increases is three months.
This is ample time for clients to ask questions, get approval, and make any necessary updates on their end. And if they refuse the rate change, it gives you a chance to find a new client to take their place.
9. Have a Back-Up Plan
Don’t make the mistake of only planning for a positive initial response from a client after requesting a rate increase. Often, clients will want to negotiate and some may even refuse the higher rate altogether.
Plan for either outcome by:
- Determining an acceptable range beforehand
- Deciding whether you’re willing to let the client go
- Choosing whether to pare down your services for the current rate
- Finding another freelancer to take the client on in your stead
For example, let’s say you’ve been working with a client for three years now and it’s always been at the same rate of $25 per hour. You’re now making $40 per hour from new clients for the same work, so it’s time to discuss a rate increase.
Before you reach out, decide how much you’re willing to accept and whether you want to continue to work for the existing client if they balk at your new rate or try to counteroffer. This could mean you hand them off to a less expensive, more junior freelancer, or you offer to do less work but for the same budget.
Either way, you should be prepared for a variety of different outcomes so you aren’t left in a bind if the conversation doesn’t go as planned.
How to Ask for a Freelance Rate Increase
When asking for a rate increase, it’s best to communicate your request in writing. Draft an email detailing important information about your rate increase such as:
- How much your rate is increasing
- When it will take effect
- Why you’re increasing your rate
Keep your tone polite and professional and let your client know that they can give you a call or book a meeting to review the details or ask any questions if need be. You should also make sure to let them know you appreciate their business.
Here’s an email template you can customize:
Hi [client name],
Since we started working together, I’ve been putting in an effort to expand my skill set and grow my business. As of [effective date of rate increase], I will be increasing my freelance rate from [current rate] to [new rate] to better reflect my professional experience and to help grow my business.
Until then, I will continue to charge my current rate of [current rate].
I’ve enjoyed helping you to grow your business by [services you provide]. It’s been a pleasure working with you and your team for the past [length of time] and I’m excited to see what we can accomplish together in the future.
If you have any questions or you’d like to set up a meeting, please feel free to reach out.
Thanks for your business!
[your email signature]
At one point or another during your freelance career, you’re going to have to ask for a rate increase. Whether you’re met with success or not depends on how you communicate your request, how reasonable it is, and how valuable your services are to the client’s business.
Research rates in advance, stand your ground during negotiations, and prepare a backup plan in case things don’t go as you expect. Take what you learn and apply it to new clients by charging them a higher rate off the bat to maximize your earning potential and build a lucrative freelance career.