"Dear UX Agony Aunt
I could use some tips for pricing of contract work. I know what my work is worth, but in the verbal negotiation with a potential client, I find it awkward to hold my ground and so I lower my rate — sometimes more than I think I should have.
What phrases can I use to say 'No'...?"
I’m going to be honest with you: I've never done contract work before. Ever. But I have more friends than shoes (and wow, do I own a lot of shoes) and many of them are freelance UX professionals. So I engaged in a little creative crowdsourcing by creating a quick and dirty survey (ten questions, a mix of open-ended and multi-choice), and sending it out into the world via the UX Mastery Community and Twitter. You've got to love the generousity of UX folk — I got five fantastic, well-considered responses. So I'll share their insights with you.
I'd say everyone struggles at some point to say 'No' in their professional lives — to clients, managers, teammates, whoever. We might fear we'll be taken the wrong way, or be perceived as rude or difficult, or that we'll burn bridges, or that we won't be offered work again. I imagine this reluctance to be anything less than perfectly agreeable is strong when you're a contractor, in particular.
So instead of ways to say 'No' to the figure a client offers, I'm going to share a few different insights from my respondents into how to position yourself and approach the negotiation — so that hopefully it doesn't have to come to 'No' at all.
Explain clearly what they're paying for
"I try to explain to them how I got the price so that they understand how much work is involved."
If your client doesn’t agree with your price, it may be because they're not clear on what they're paying for. You may come across clients who are new to the idea of user research and design, and so underestimate the time and effort your project will take. Or they may never have worked with a contractor before and don’t know what reasonable looks like in this situation. The clearer you can be about the value they'll get for their dollar, the more comfortable they'll be accepting your fee.
Approach the negotiation with flexibility and openness
I asked people how they determine the cost of their work. Four out of the five said they have a set fee structure that they use as a starting point and then they negotiate from there on a case by case basis. Budget is a powerful driving force that every client feels and it’s important that you are open to understanding their position. I also asked them to describe how they approach discussions with clients around the cost of their work and almost all responses echoed what this one had to say:
"I ask what their budget is first. Then talk about my regular fee and what is possible within their budget."
When going into these discussions, it’s really important that you know what your negotiation position is. What’s your ideal pay? How far are you willing to bend to land the job? Are there any non-cash perks that you could suggest to replace that ideal number? Perhaps you could suggest they pay for some of your costs (like meals, accomodation, workspaces, software subscriptions, and so on). A survey participant also came up with this golden piece of advice for you:
"Have differentiated fees depending on type of work, and send the terms, conditions and fees in an email. And maybe negotiate a lower fee if the client agrees on giving you more work."
Keep the conversation on topic and flowing in both directions
Make it your goal to achieve an outcome you can both be comfortable with. Or as one survey participant put it when asked what a successful negotiation looks like:
"When both sides are happy and/or both sides compromised to get to the agreement without compromising the integrity of either party."
Another person emphasised the importance of keeping the discussion on topic.
"Successful negotiation should not be emotional. You're checking to see if you're the right fit for them, and they're the right fit for you. If so, great. If not, no problem. If they bring emotion into it or play on favors or anything else that isn't objective, politely bring it back to a matter of dollars and cents — that you provide great value, do great work, and this is what it costs for you to be able to do business with them. It’s that simple."
Focus on giving your client a great experience
When you interact with a client, you aren’t just providing your work as a service — you are delivering an experience. In fact, according to one participant:
"Good client experience is essential to your survival as a freelance UX professional."
View your potential client the same way you view your user! Make it your mission to understand what makes them tick. Before you go into that meeting research everything you can about them and what it is they do. Most of this information is freely available on the internet. Start by looking at their website and have a flick through their recent annual report (if applicable). Ask yourself:
- What do they do?
- What do they want?
- What drives them?
- What pressures might they be facing?
- Why have they called you?
When clients see that you have an in-depth understanding of their business, they'll not only be more receptive to your ideas — chances are they'll be more receptive to higher fees as well.
Play the long game
Your clients aren’t disposable cutlery. Be open to the possibility of long term or repeat working relationships with every potential client you encounter. Basically, accepting a lower fee in the interim might just pay off in the long run. A great piece of advice that came out of my survey was:
"Work fast, reach out to everyone, set up tons of meetings, ask for further introductions from everyone you meet. Send thank-you notes and be friendly with everyone. Try to help them all with connections. In the end, work and options and connections and referrals will come back to you later."
And while I had an audience with the best and brightest freelance UX professionals, I thought it might be fun to ask them: What's the best piece of advice you received when you started out as a freelancer? Even if you've been contracting for a while, I think you'll find their words as inspiring as I did.
"Don't underestimate your value — you can always go down in price but it is difficult to go up."
"You'll get mostly 'Nos', and every 'No' you get is great because it's one step closer to the eventual 'Yes' you'll get."
"Good luck, and don't forget to learn tons and have fun each time too — it's your life and it's your job to make sure your job is enjoyable to you, even when challenging."
I’d like to extend a BIG thank you to those who participated in my survey and if anyone has anything they’d like to add, please share in the comments below.