By Lynne Gowers on 14th August 2014

Freelancer tips: The key to negotiation

Negotiating rates of pay is a tricky topic. Some freelancers hate it, some love it, but the fact is it’s quite a big part of being an independent professional.

There can be many reasons why people do struggle to negotiate. It could be down to a lack of confidence, a fear of rejection or maybe you’re just not a salesperson at heart.

Freelancer tips: The key to negotiation

Chances are you’ve had some experience anyway, bartering down a taxi driver on holiday, haggling over the house of a price – negotiation is fairly common in most areas of life already!

However, when it comes to your salary, things can be a little different and that’s what this guide is here to help you with!

Whether is a new client, a contract extension or you’re new and just setting your rate for the first time, these tips will hopefully give you the confidence to drive home the deal you deserve.

Take a deep breath

Negotiation is a massive part of freelancing and contracting. In fact, it’s massive part of businesses in general and so many clients will expect it anyway. Before you start off a dialogue, just relax! Take a deep breath and try to calm your anxieties. It’s just a normal transaction and there’s no need to fear it. If you lack confidence in your convictions chances are that you’ll struggle to persuade anyone to buy into your argument.

Aim high

Never undervalue yourself and start off low. Clients may be willing to negotiate fairly but if you give them the option to save money for good service, they will take it. Also, by offering an amazing deal first off you will have very little room to manoeuvre afterwards.

So start high – but not ridiculously high, you don’t to price yourself out of a deal – and go from there. It’s also wise to have an idea about what your ultimate compromise would be before hand – a point that you absolutely cannot go under.

Back up your arguments

When negotiating you cannot simply ask for money with no arguments to back it up. Explain why your service is worth what it’s worth. If it’s a new client, explain what you can do for them, with reference to past projects.

If you’re tackling a contract extension and want a pay rise, let them know what you intend to do going forward and what added part of your service constitutes a boost in wage.

Know exactly what you want

If you hum and ha around figures it’s very unlikely that those you are trying to convince will take you seriously. State the pay you want, why you want it, why you think you’re entitled to it and what the client will get out of paying you that amount.

Not only will this show organisation and determination on your part but it will also reflect confidence, which is hugely important when haggling.

Consider a few freebies

Are there parts of your service that you can throw in as a deal breaker? Maybe a bit of consultancy work or some sort of audit? Throwing in a freebie like this can make the client feel appreciated and give you a little leverage in negotiations.

Obviously you don’t want to be giving away your skills for free, but if there’s a task you can do that won’t eat into your time and resources too much, it might pay (literally) to bring this to the table.

Minimum Acceptable Rate

Your Minimum Acceptable Rate (MAR) is the lowest rate you are willing to ply your trade for. has a very simple equation for this is:

(Personal overheads + business overheads) / hours worked ) + tax

Basically, you need to work out your  basic living costs (food, rent, etc), businesses overheads and how much work you intend to do during the week.

For a contractor this may work out at one sum, but for a freelancer, who works via multiple different contracts at the same time, you may need to work out each new project as a percentage of your overall MAR.

Once you have this rough estimate in place you can start looking at what others are charging in your area with the same skills and set an acceptable rate. From here you can negotiate with the client.

Written by Lynne Gowers
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