Hourly Rate

[j_weeces]

Hey all!

So I've been applying to a lot of jobs lately and used to get quite a few, but I'm having a hard time landing clients recently. I've considered changing my hourly rate to see if I can get more clients but I'm worried about it. 

Based on my profile, success rate, history, etc. what do you think I should be charging?

Any guidance or help is greatly appreciated! Thanks!

[wlyonsatl · Accepted solution]

Unfortunately, Upwork did away with one of the most helpful tools on Elance - making available to any freelancer the pricing on the winning bid for each project. Knowing where your bid price was compared to the winning bid was more than just a little interesting.

Have you already done the same work before joining Upwork? If so, you have some idea what you should be charging on Upwork. If not, it will take you longer to figure out your ideal bid price. 

Either way, you're going to have to experiment with your pricing to find your sweet spot of the right amount of new work flow and earnings that meet your requirements:

1) Vary your "standard" price on your profile every few days, beginning on the low end of what you think is reasonable (however you define that). With any luck, you'll get some clients contacting you directly. If you don't get any direct contacts, your price may be too high compared to your competitors and you'll need to lower it. If you get a lot of direct client contacts, incrementally raise your "standard" price until you get the flow of direct contacts you want.

2) Vary your price on projects you find and apply to, keeping track of what your bid was and looking back after you've made at least 30 or 40 separate bids to see if there was any difference in bid success based on the different prices you used. (It's better to win 5 jobs at $10 than to win 10 jobs at $5, all other things being equal.)

Of course, in your particular niche on Upwork there may be a lot more things clients consider than just price when choosing a winning freelancer - quality and relevance of their portfolio, the cover letter, previous client's feedback, etc. Unfortunately, the lowest bid price and the freelancer's Job Success Score may be the most important criteria some client's use - these may not be jobs you'll want to win anyway.

Good luck.

[j_weeces]

Hey Will!

Thank you so much for the thorough response. I haven't done any web development work outisde of Upwork prior to joining.

That is unfortunate that they did away with the feature, it would be super nice to see that!

I've been freelancing on Upwork for just over a year now and I think I may have raised my prices too quickly.

I've dropped my rate some this week and I'm definitely going to try varying like you mentioned.

Again, thank you so much for all the pointers and help. I think this will assist me a lot!

[wlyonsatl]

By the way, I recommend you completely ignore the bid amount Upwork occasionally recommends on some projects. Some of the numbers I have seen are nosebleed high - way above what any client can easily see is my profile's "standard" hourly price. 

Like the JSS, for which Upwork has provided no evidence of predictive value, I have seen no information that confirms these pricing recommendations from Upwork are likely to win any particular proposal. Since I can no longer see what the winning bids have been on these projects, I can't know for sure. But I'm unwilling to risk losing out on a project that fits my criteria because I've submitted a price way out of line with my usual range of rates based on a black box algorithm making recommendations to me.

Your proposal rates should usually be pretty much in line with your profile's "standard" price. If you submit a proposal that is significantly higher than your "standard" price and don't justify this higher price in your bid's cover letter, another freelancer will likely be chosen if their bid is lower than yours.  

[cahenningsen]

I'm new here too, though I was on ODesk before the merger.  I'm seeing a lot of very low ball content sweat shop budgets which I routinely flag as "budget too low. " I've been earning a minimum of $75./hour since the 90s ($150 for several years now), but I'm beginning to think that the only way to get work here is to work for a ridiculously low rate initially and then go through a long process of raising my rates.  I'd be interested in hearing from anyone in the same rate ballpark.  Thanks.

[vnikolaou]

Hi, this is a context that targets the whole globe. I was working too in IT companies for example in my country for many years, then for several reasons i ended up in oDesk and now Upwork. 

I don't want to complain necessarily, but the fact is that competitiveness moved from "country-scoped" to "global-scoped" and this includes skills and of course mainly hourly rate and how much you can earn. 

Considering the fact that you have to compete with people from poor countries where the living cost anyway is much smaller explains everything. Simply you cannot compete them by keeping your expectations high. 

On the other hand the employers look to take the best with smallest cost, which limits even more the available budgets and business approaches. 

In the end, what the lower cost employees from such countries use and put as hourly rate in their applications is I believe the driving power for all the system. Based on that unfortunately, you start using your advantages and add more value which can compete as some percentage those lower cost applications.

[kinector]

Just mentioning something hopefully helpful here for future readers of this thread.

If your business plan is based on offering the same service to the same people at the same price as everyone else, you'll always be in the race to the bottom. As this is a global game, there's always someone equally good but more desperate to do even more lowballing than you do.

The only good way out of all that is to build capability and a service based on that capability that the next guy simply doesn't have. It could be just about anything, really. Build your own category of service offering so you can own your niche, globally no less!

Do that and you can make this and just about any other platform to work as your personal marketing tool where you mainly just sit back and wait for clients of which you only take the best ones and leave the rest for others to fight for.

That's the game of the global freelance business.