20% service fee after $500 in contracts?

kkears · ‎12-16-2020

I'm still be deducted a 20% service fee on my contracts even though I've already had $500 worth of completed contracts. Can someone help? Am I misunderstanding the service fees?

BojanS · ‎12-16-2020

Hi Katie,

Freelancers are charged a sliding fee based on their lifetime billings with each client (across all contracts they've ever had with that client's company). Service fees are the same whether the contracts are hourly or fixed-price. Once they have earned $500 with one client their fee will be reduced to 10%. To learn more about our freelancer's fees check out this help article.

Thank you!

~ Bojan

richardrader · ‎12-16-2020

Katie the fee is based per client. For example say you make $800 with 1 client, the fee for that contract would be 10%. Then say you made $11,000 with a different client. The fee for that client would be 5%. Then say you found a new client, the fee would be 20% since you have not made any money yet with that new client. How much you make overall across all of your clients makes no difference.

This can be discouraging to some but I would simply advise to build your rate around the 20% fee. So for simplicity say you want to make $10/hr. You could simply charge $12/hr instead. Then once you make $500 with that client you essentially would be making $11 (which is more than you initially wanted). Once you hit $10,000 you would be making even more ($11.50/hr).

I wouldn't worry so much abut the fee as you see in my example above you can actually use it to your advantage (for longer term contracts). The fee is just a business cost and should be considered when determining your rate.

petra_r · ‎12-16-2020

Richard R wrote: "Then say you made $11,000 with a different client. The fee for that client would be 10%".

No. It would not be 10% - It would be 5%

richardrader · ‎12-16-2020

Petra R wrote:
Richard R wrote: "Then say you made $11,000 with a different client. The fee for that client would be 10%".

No. It would not be 10% - It would be 5%

Corrected, must have not had enough coffee this morning.