Solved: Share fees with client

Carlos L · ‎10-21-2020

Don't you ever feel like the Upwork fees were being supported by you instead of the client? Well, this is my case, if I have a contract worth USD50 I end up with only USD40, and client pays the original USD50, looks like no fees for him. The solution would be if a contract is worth USD50 Upworks takes from me only %10 so I would end up with USD45, and client actually has to pay USD50 more %10, a total of USD55. That would be a shared fee system. More suggestions to come!

Petra R · ‎10-21-2020

Carlos L wrote:
But, as read in your last posts, it looks like you are much in favor to clients with the idea to keep them,

As a freelancer I depend on Upwork keeping clients happy. Less clients means less money for freelancers. It's hardly rocket-science, is it? Every lost client means less income.

At the end of the day, just build the fees into your rate, they're tax deductable anyway as they are a business expense.

View solution in original post

Petra R · ‎10-21-2020

Carlos L wrote:
The solution would be if a contract is worth USD50 Upworks takes from me only %10 so I would end up with USD45, and client actually has to pay USD50 more %10, a total of USD55. That would be a shared fee system.

Why would you want to have less clients?

Build the fees into your rate and bid $ 55 in the first place. Problem solved.

Carlos L · ‎10-21-2020

Thanks Petra! But, as read in your last posts, it looks like you are much in favor to clients with the idea to keep them, I wonder whether to be favoring clients means to be unfair to freelancers.

Petra R · ‎10-21-2020

Carlos L wrote:
But, as read in your last posts, it looks like you are much in favor to clients with the idea to keep them,

As a freelancer I depend on Upwork keeping clients happy. Less clients means less money for freelancers. It's hardly rocket-science, is it? Every lost client means less income.

At the end of the day, just build the fees into your rate, they're tax deductable anyway as they are a business expense.

Lisa T · ‎11-27-2020

I totally agree with you Carlos - it is very biased towards the client and grossly unfair. It's no good being told that without clients there is no work - without freelancers to do the work there is no business! Both should be valued equally and share the fees for sure. If UpWork truly believe in their business model, they wouldn't be scared to charge the client.

It is also nonsensical to tell you to up your hourly rate, as this would mean possibly being overlooked by clients for cheaper freelancers. THAT's not rocket science!

In the "real" world, it's the employment agencies who pay the hire fees - well certainly in the UK it is. An employee would NEVER be expected to pay to get a job! That would be preposterous!

Hope this makes you feel a bit better knowing that someone else shares your view.

Lisa

Jamie F · ‎11-27-2020

Lisa T wrote:
It's no good being told that without clients there is no work

But that's the reality. Would you rather hear a comforting lie instead?

Lisa T wrote:
without freelancers to do the work there is no business!

Sure. But there's too many freelancers on Upwork. It's a buyer's market. If there were not enough freelancers on Upwork then you **might** have a point. But there is enough - and then some.

Lisa T wrote:
Both should be valued equally and share the fees for sure.

And watch the clients leave Upwork in their droves.

What would that achieve?

Lisa T wrote:
If UpWork truly believe in their business model, they wouldn't be scared to charge the client.

Huh? Charging minimal fees to clients and higher commissions to freelancers IS the business model. If they charged clients instead then that would mean a complete overhaul of the business model - which would mean they didn't believe in the original model.

In the "real" world, it's the employment agencies who pay the hire fees - well certainly in the UK it is. An employee would NEVER be expected to pay to get a job! That would be preposterous!

Upwork is not an employment agency. Freelancers are not employees. Employees would probably not pay but enough freelancers will to make the business viable.

If you're not one of those freelancers willing to pay then you are free to find a portal that does share the costs more equally. Good luck with that.

Question: Do you think clients would continue to use Upwork if they had to share the fees, or do you think they'd take their money to another platform where they don't have to pay?

Lisa T · ‎11-27-2020

Hmmm, I hear you but I still feel both client and "freelancer" should be treated equally. The client needs the job done right? That's why they are using this service. Yes, I do believe decent clients would be willing to pay to find the right person for the job.

It just never ceases to amaze me what an incredibly greedy world we live in!

Oh well, thanks for your time - back to my lovely life in my happy bubble! 😉

Christine A · ‎11-27-2020

Lisa T wrote:
Both should be valued equally and share the fees for sure. If UpWork truly believe in their business model, they wouldn't be scared to charge the client.

It is also nonsensical to tell you to up your hourly rate, as this would mean possibly being overlooked by clients for cheaper freelancers. THAT's not rocket science!

If you're charging $25/hour and Upwork were to charge you 10% and the client 10%, then the client will pay $27.50 per hour. Why not just charge $27.50 an hour yourself? What's the difference? And yes, you're supposed to decide how much money you're willing to accept for your services, and then add your fees and expenses on top of that. Trying to compete on price when you live in the UK is an impossible task - you have to charge more and convince clients that you're worth it.

Lisa T wrote:

In the "real" world, it's the employment agencies who pay the hire fees - well certainly in the UK it is. An employee would NEVER be expected to pay to get a job! That would be preposterous!

I live in the UK and get hired through a few different freelancing agencies, and they absolutely do take a percentage - 50%, in some cases. It's worth if it they can get me high-value clients.

If you don't want to pay any fees, then you do have the option of doing your own marketing. I get a fair number of clients via Linked In and cold calling/emailing, but it requires a lot more time and effort, and I can't always be bothered. That's when I decide that it's worth it to pay a fee to have others do my marketing for me. If it's not worth it for you, then you should definitely explore other options.

Lisa T · ‎11-27-2020

Wow - 50%!? What a terribly greedy and unpleasant world we live in!
Thank goodness I opted out and now enjoy a wonderfully simple life with the little projects I do here and there.

I wish you luck 🙂

Christine A · ‎11-27-2020

Lisa T wrote:
Wow - 50%!? What a terribly greedy and unpleasant world we live in!

LOL - well, I don't agree that greed has much to do with it. I work for some of the biggest agencies in London, and I know what they go through to obtain new client accounts - preparing pitches that sometimes take weeks, and spending huge amounts of money with no guarantee of a return. I'm happy to have them spend their money and time getting clients and managing the accounts, then outsource work to me at my hourly rate, since I don't have the resources to go after big clients myself. Just like I'm happy for Upwork to spend billions on advertising and then give them a 20% cut when I get new clients here. It all works out just fine.

I wish you luck 🙂

Thanks, but I think that I make my own luck. 😉

Abinadab A · ‎11-27-2020

Ok, so the concept of luck, and whether it exists or not has been hotly debated many times over in this forum.
May we not enter that rabbit hole again.

Petra R · ‎11-27-2020

Lisa T wrote:
It's no good being told that without clients there is no work - without freelancers to do the work there is no business!

Apart from what the others said, the difference is if freelancers leave in droves, NOTHING happens because Upwork is drowning in freelancers and there are 10 literally desperate to take the place of every one who leaves Why do you think Upwork profiles are sold on the black market?

Losing freelancers is irrelevant, they are easy and free to replace. Losing just one client is a loss. Upwork is not a charity and is in the business of making money. That means they make decisions which maximise the flow of money. As maximum flow of money benefits freelancers, this is clerly a win-win situation! The more money flows, the more freelancers earn.

This is hardly rocket science.

Lisa T wrote:
In the "real" world, it's the employment agencies who pay the hire fees - well certainly in the UK it is.

You are mixing up freelancing and employment. Don't do that, they are very different animals altogether.

And in the UK, employment agencies don't pay the fees, that's nonsense. The employers do (again, do not mix up employment and freelancing)

Lisa T · ‎11-27-2020

Gosh, I wouldn't know how one could find out the ratio unless they worked for UpWork!?

Good grief - how awful - sold on a black market!? Like cattle?!

Yes, you are quite right, I meant to say the Employer pays.

Well, as I just replied to another contributor, it shows what an incredibly greedy world we all live in.

Thanks for your response.

Petra R · ‎11-27-2020

Lisa T wrote:
Gosh, I wouldn't know how one could find out the ratio unless they worked for UpWork!?.

After 10 years you know where to find what.

Lisa T wrote:
Good grief - how awful - sold on a black market!? Like cattle?!

I don't think there is a black market for cattle?

Lisa T wrote:
Well, as I just replied to another contributor, it shows what an incredibly greedy world we all live in.

To be honest, business is not "greedy" - business is meant to create revenue. Did you know that to this day, Upwork has never made a profit yet?

Ultimately, I freelance full time on the site. So there are just two things I need from Upwork:

A stable platform (this has improved beyond recognition over recent years) where I can win work and process my earnings, maintain my profile and decide on my rates and pricing freely. Personally, especially considering where you live, I think your rate is dramatically too low.
I need Upwork to attract clients and keep them happy, so I can have access to those clients and earn lots of lovely money from them. Everything Upwork does that upsets a client results directly in a loss of opportunity and income for me. In reality, by wooing clients, Upwork is actually favouring freelancers, both directly and indirectly. It takes a switch from "thinking like an employee" to "thinking like a business!" to see the whole picture.

Abinadab A · ‎11-27-2020

Petra R wrote:
Losing freelancers is irrelevant, they are easy and free to replace.

Freelancers are not entirely free to replace. At least, not the right kind of freelancer. They cost some money to replace, only not as much as clients.

Upwork does a lot of work behind the scenes to attract highly specialised freelancers not available on other platforms.

So let's put it this way: clients attract freelancers and freelancers attract clients on here, but it in no way justifies increasing fees on the client side. The idea is just sheer garbage and so anti-business.

To the OP, Upwork's freelancer fees are one of the lowest in town now.

Look it up.

Petra R · ‎11-27-2020

Abinadab A wrote:
Petra R wrote:
Losing freelancers is irrelevant, they are easy and free to replace.
Freelancers are not entirely free to replace. At least, not the right kind of freelancer. They cost some money to replace, only not as much as clients.

I hear you. SOME freelancers aren't. Those are, however, the ones least likely to be going anywhere any time soon. So I'd say in the overall scheme of things, looking at the full picture, the statement above is pretty accurate overall.

Abinadab A wrote:
but it in no way justifies increasing fees on the client side. The idea is just sheer garbage and so anti-business.

Exactly. And it would hurt freelancers. All freelancers. Badly.

The reason why NONE of the main platforms do something as insane as this is because it is an apallingly, ridiculously bad idea. A idea that would hurt the business and hurt freelancers. Very much so.

Nichola L · ‎11-27-2020

Carlos L wrote:
[...]More suggestions to come!

__________________________
Please ... spare us ...

Andrei T · ‎11-27-2020

You can always ask the client to reimburse you for the commission by paying you a bonus (good luck with that; and don't forget about the new commission you will incur on the bonus!)

However, the reason why the commission is entirely on the freelancer is not because clients are more important than freelancers. It's because new clients are much more sensitive to this kind of thing, as they are just testing the platform and its costs. You want to keep their stress at a minimum at this stage and 'commissions' won't have a calming effect.

OTOH, freelancers are much more likely to be familiar with how the model is structured, will normally to the math before bidding and are in a better position to manage the fees on their side (can choose to pass them on or not).