Get Paid Like an Agency

A $100,000 employee doesn’t cost an employer $100,000. You also need to consider:

• Retirement Benefits

• Healthcare

• Office Rent and Supplies

• Payroll Tax

• Training, PTO, Bonuses

• Etc.

In Illinois, it wouldn’t be unreasonable for a 100k employee to actually cost an employer ~$135,000 a year.

$48.08/hr turns into $64.90/hr.

Oh, and an employer doesn’t plan on losing money when they hire staff, so they charge clients well above that $64.90/hr to account for that employee’s salary plus the margin needed to run a sustainable business.

I say all this because when freelancers first get started, they tend to get very self-conscious when deciding what to charge their clients. Admittedly, it’s a bit uncomfortable to put a specific price tag on your time.

We are so tied to what we used to make as an employee that the idea of charging $50/hr, $75/hr, $100/hr, $125+/hr for our services is inconceivable.

I have great news for you… there are plenty of businesses out there willing to pay $100+/hr for the work you do.

Forget your last salary.

It’s easier said than done, but try and forget about your former salary. You are a business now and need to price yourself that way. 

Clients aren’t paying me X amount each month. They are paying Oddo Digital LLC X amount each month. I still have to pay for my own insurance, software, fund a retirement account, etc.

I’m not competing against other employees or even freelancers on Fiverr. I want to go up against other SEO agencies.

So, for me, I’m pricing myself relative to the market, my experience, the value I deliver, and most importantly, what clients are willing to pay.

At first, I charged 50% less than my last employer charged their clients and it was still 66% more per hour than I made at my last job!

It was intimidating at first but when I really thought about… I could provide a higher level of service to my clients, at a fraction of the cost, while still making more money than I did as a salaried employee. That’s a great deal for everyone.

So when you’re first getting started, I highly recommend taking following steps:

• Talk with industry peers who offer a similar service about their pricing model. I think you’d be surprised at how many folks are willing to let you know this info. I’ll share if anyone asks me directly!

• Define your own pricing and delivery strategy (custom quotes, packages, etc.)

• Talk to prospective clients to understand what different sized companies and industries are willing to pay

• Test different pricing and contract strategies during sales cycles

• As you sign clients and deliver your service, make notes and adjust your offer based on what’s working and what isn’t

Note: If what you’re charging doesn’t make you feel a little uncomfortable, then you are probably not charging enough.

Thanks for reading!

Brian