Weekly rate, or daily rates instead of hourly rate.

[mazyger]

Hello there,

What do you think about it?

I started new in Upwork to earn, but if I do external jobs there is a method to get paid by clients daily / weekly (not hourly) which is very good. This sometimes makes more sense than hourly rates or fixed prices. I hope that upwork can also implement this as a payment method and even sensitize customers that it is a good method.

And this is why

Well, fixed-price and hourly rates have both advantages and disadvantages - at least for me as coder and also sometimes for the customer. I will focus on disadvantages.
Lets start with hourly-rates

Hourly

I often hear that I am very quick with my job. I often hear that they have never met an advanced programmer like me. I even believe this. I fix their code very often (I am sure there are many good or even better programmers than me). And this is the problem. Someone who is slower than me but has the same hourly rate will make a lot more than me. Because I am very fast. So am I being punished for being good? Especially with the desktop tracking timer you really can feel the punishment. Even I would raise my hourly rate insanely. I will still have the punishment.. beeing fast means less work. So the worktime (hours) is the problem here.

Another good example: Imagine you know the work what you will do will be around 20 hours. Let's say excactly 20 hours for $100. So you would earn $2000. But you found a tool which costs you $700 which will save you 15 hours. You can be quicker. Customer will like it but. But you would earn just for 5 hours $500 and even you lose money because $500 - $700 = -$200, just beeing to quick and provide the best possibility for the client.

What are the possibilities?

1) You buy the tool and work 5 hours and 15 hours or even less like 10 hours you are chilling around. You still would earn $800 (= 15h * $100 = $1500-$700). You even can tell you were faster and 20 hours was not needed.
2) You ask the client to buy the tool, if he is ok with it, will save you $700 but you just earn $500. and have even the tool in your hands. The client would need to invest into you $1200!
3) You don't buy or use the tool and you earn $2000 and work 20h.

EDIT: 2) had wrong calculation. I fixed it.

Which one is good? None of that, especially 1). 2) Maybe the client will not do this. Or if he does you still earn $500, but hey, you are owning new tool worth of $700. At the end you have win of $500.

Fixed Price

Often I made the expierence with misscalculating the cost & time. Often you have some problems here and there. Suddently application crashs, code does not work for all user etc. In very very rarely cases does the code what it should. In most cases it needs a fix (based on complexity).

So even if we said $300 I may work 2x more than normally. It is like at the end I would earn $0 because I lost in the time where I could earn another $300. You know the saying, time is money.

Ok, what can be a solution? Right what I already mentioned. Daily or Weekly rate.

Weekly rate

Let's compare it with the hourly rate example.

If we would say we want weekly rate of $2000 it doesn't matter if I buy or not the tool. The client knows he need to pay $2000 even if you finished something very quickly or not. The contract is for this week, $2000.

The focus is not on your TIME, which you use for work, but on the WORK, the result. It is like you would sell to the customer a product and have multiple weeks delivery time (or month like a tesla, hehe). Not the worktime.

So even you would need to pay $700 for the tool. You are owner of the tool, you still earn $1300 (=$2000-$700) and you are even quicker (remember, before you would have $1200 if he would buy it for and not to keep the tool). BOTH are happy. If the customer asks why you are finished so quckly (maybe he thought it will take few days or even a week), you can even tell him that you needed to (pre)invest the earning for the tool and it helped him to be quicker but actually you are not forced to tell.

Also if you have an other contract like coding a game or developing an app with flutter etc. you can be flexible. A one day you can do less work another day you can do more.

Daily rate

Of course this example above wouldn't work for daily rate. But same here as well:
If you get a contract, let's take the example with coding a game. You can say the customer it will takes around 3-5 days maybe. So for every new day you receive $400. Even you would need just two days 3-4 hours per day you still earned $800. And the good thing is at same day the customer still can go for correction and ask for changes. So he does not need to pay more or less.

I wouldn't use this anyway. This is more for things with real communication. If you are a craftsman and not working digitally then perfect. The results are seen in real time and the customer could want to have changes. For you it shouldn't care because you get your $400 that day.

Remember daily rate does not mean to count hours. 

Of course we are still human. We should not work 24/7 and still limit ourself to around 8 hours per day.

What are your thoughts about it?

Should Upwork offer something like this? I say yes!

[prestonhunter · Accepted solution]

Weekly Payment is already an available option.

It is pro-rated. Thus: This also constitutes a Daily Payment feature.

https://community.upwork.com/t5/Clients/What-is-the-best-way-to-pay-a-flat-weekly-fee/m-p/957718

https://support.upwork.com/hc/en-us/articles/211067938-Pay-for-Hourly-Contracts

[mazyger]

Oh thank you. I didn't notice it. I even googled for it but it didn't show for me.

[jr-translation]

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Bilal Y wrote:

Hello there,

What do you think about it?

I started new in Upwork to earn, but if I do external jobs there is a method to get paid by clients daily / weekly (not hourly) which is very good. This sometimes makes more sense than hourly rates or fixed prices. I hope that upwork can also implement this as a payment method and even sensitize customers that it is a good method.

This is not really going to happen. If you know a job will take 2 days, offer the client a fixed rate. Eg. you estimate 10 hours and offer a fixed rate for 15 hours, You have 5 hours extra in case something goes wrong. If you are faster, you make more money and the client is still happy because the expenses did not explode.

And this is why

Well, fixed-price and hourly rates have both advantages and disadvantages - at least for me as coder and also sometimes for the customer. I will focus on disadvantages.
Lets start with hourly-rates

Hourly

I often hear that I am very quick with my job. I often hear that they have never met an advanced programmer like me. I even believe this. I fix their code very often (I am sure there are many good or even better programmers than me). And this is the problem. Someone who is slower than me but has the same hourly rate will make a lot more than me. Because I am very fast. So am I being punished for being good? Especially with the desktop tracking timer you really can feel the punishment. Even I would raise my hourly rate insanely. I will still have the punishment.. beeing fast means less work. So the worktime (hours) is the problem here.

No, you just have to find a rate that meets your qualification.

Another good example: Imagine you know the work what you will do will be around 20 hours. Let's say excactly 20 hours for $100. So you would earn $2000. But you found a tool which costs you $700 which will save you 15 hours. You can be quicker. Customer will like it but. But you would earn just for 5 hours $500 and even you lose money because $500 - $700 = -$200, just beeing to quick and provide the best possibility for the client.

These tool is a business expense. Treat it as such. If the job would usually cost $2000 and the tool helps you to safe time, great. This gives you the chance to work on another job. No need to tell the client how the job was done, as long as it does not violate the ToS.

What are the possibilities?

1) You buy the tool and work 5 hours and 15 hours or even less like 10 hours you are chilling around. You still would earn $800 (= 15h * $100 = $1500-$700). You even can tell you were faster and 20 hours was not needed. That would be a ToS violation. You are not allow to charge for time you are not working on the job.
2) You ask the client to buy the tool, if he is ok with it, will save you $700 but you just earn $500. and have even the tool in your hands. The client would need to invest into you $1200! That also means the client owns the tool and you have to return it to him.
3) You don't buy or use the tool and you earn $2000 and work 20h. Sounds fair

EDIT: 2) had wrong calculation. I fixed it.

Which one is good? None of that, especially 1). 2) Maybe the client will not do this. Or if he does you still earn $500, but hey, you are owning new tool worth of $700. At the end you have win of $500. Exactly. I invested €700 the other day and made €3k in the following two weeks.

Fixed Price

Often I made the expierence with misscalculating the cost & time. Often you have some problems here and there. Suddently application crashs, code does not work for all user etc. In very very rarely cases does the code what it should. In most cases it needs a fix (based on complexity).

So even if we said $300 I may work 2x more than normally. It is like at the end I would earn $0 because I lost in the time where I could earn another $300. You know the saying, time is money.

Ok, what can be a solution? Right what I already mentioned. Daily or Weekly rate.

Weekly rate

Let's compare it with the hourly rate example.

If we would say we want weekly rate of $2000 it doesn't matter if I buy or not the tool. The client knows he need to pay $2000 even if you finished something very quickly or not. The contract is for this week, $2000.

The focus is not on your TIME, which you use for work, but on the WORK, the result. It is like you would sell to the customer a product and have multiple weeks delivery time (or month like a tesla, hehe). Not the worktime.

So even you would need to pay $700 for the tool. You are owner of the tool, you still earn $1300 (=$2000-$700) and you are even quicker (remember, before you would have $1200 if he would buy it for and not to keep the tool). BOTH are happy. If the customer asks why you are finished so quckly (maybe he thought it will take few days or even a week), you can even tell him that you needed to (pre)invest the earning for the tool and it helped him to be quicker but actually you are not forced to tell.

Also if you have an other contract like coding a game or developing an app with flutter etc. you can be flexible. A one day you can do less work another day you can do more.

The big flaw in your idea is that you own the client the entire week. You cannot charge him or the entire week and then work on something else unless th client agrees to pay you for working on someone elses project.

Daily rate

Of course this example above wouldn't work for daily rate. But same here as well:
If you get a contract, let's take the example with coding a game. You can say the customer it will takes around 3-5 days maybe. So for every new day you receive $400. Even you would need just two days 3-4 hours per day you still earned $800. And the good thing is at same day the customer still can go for correction and ask for changes. So he does not need to pay more or less.

I wouldn't use this anyway. This is more for things with real communication. If you are a craftsman and not working digitally then perfect. The results are seen in real time and the customer could want to have changes. For you it shouldn't care because you get your $400 that day.

Again, if the client pays for the entire day you owe him or her.

Remember daily rate does not mean to count hours. 

Of course we are still human. We should not work 24/7 and still limit ourself to around 8 hours per day.

What are your thoughts about it?

What you are describing are fixed-rate contracts. You get a request, calculate 16 hours and quote $800. If you are done faster, lucky you. If it takes longer remember next time and calculate 24 hours.

Should Upwork offer something like this? I say yes!

No, your description shows all the flaws and how easily freelancers could abuse that option.

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[mazyger]

The example was not focused just for upwork. Yes of course it is against ToS here, but I wrote this for any contracts and not limited to upwork and of course you never should chill around and let the time fly.

No, you just have to find a rate that meets your qualification.

- Yes, of course. But at the end it is same. My example could even happen with higher payment. With coding you sometimes write shortcurts. A way to automatic things and this still happens.

I give you a good example from my old jobs (not upwork). A client hired me multiple times for similar jobs, hourly rate. It was most time something with "press a key on keyboard, let that happen". You know after a while it is always same code. There were difference of few hours or sometimes whole day between the jobs. After while you reuse the code. This means few hours are reduced. Even same code can be used for other clients.

Well, do you think the same client, for same (similar) jobs I get more payment because I get quicker. Of course he disagreed. I mean I work less and I want even more money. Could work with new clients maybe.

Btw: Weekly rates are not best here as well. The tasks were just to short for this.

The big flaw in your idea is that you own the client the entire week. You cannot charge him or the entire week and then work on something else unless th client agrees to pay you for working on someone elses project.

- The client should know and agree. And yes, most agree (especially if they pay low), because they see results and the job gets done. 

No, no you may should read about weekly rates.

They don't pay me for someone else's project. They also do not own me or I owe the week. I said multiple times there is no time in this rate, only the result counts (like a mix of fixed-price + hourly rate). (EDIT: To better describe, they paid for the product). You should understand, they have "paid" the week (or the 5 days, does not need to start on monday). Even if I worked an hour and finished the project, the pay was like working for 5 days. Of course never should do that and also the client would never agree if the work needs really few hours . After I finished it it, the job is done. 
I insure revisions for complex tasks and higher payments (even everything worked well and they said job is done, I still make me available for them), and focus me more for them (of course, they pay me well :D). There are no time or need for two or more clients.

Exactly. I invested €700 the other day and made €3k in the following two weeks.

- Only if you really find new job.

What you are describing are fixed-rate contracts. You get a request, calculate 16 hours and quote $800. If you are done faster, lucky you. If it takes longer remember next time and calculate 24 hours.
- Most time they give a deadline and have limited budget.

Anyways, it think this is based on what you do. I am coding and most time it is hard to estimate. I said sometimes a code works very well and sometimes it takes days. I had this two weeks ago. But luckily it was houry rate (and of course I earned much more than I should actually).

No, your description shows all the flaws and how easily freelancers could abuse that option.

- That's sadly true. It could get abused. But the funny part is, it already exists but I didn't know that because one of my old clients we talked about it and he want to do that but we didn't know if it is possible on upwork.

The only thing I would like to have is to show that (weekly rates) on my profile too.

[martina_plaschka]

You seem to miss the point that when you are done with a job faster, you are free to take on other work. 

[mazyger]

Sorry but you miss the point (even many) as well. It is ok if you don't like that.

First of jobs are not flying to me and most are not paying well (especially here). There are days you may not get any job. 

Second: This is a contract booked for a week (5 days, can start on any day like wednesday) which extends every week until the job is done. So, even I am finished and few days are left for the weekend, I still can get another client or have already and work with two or more clients at same time. Of course it needs an estimation if it is even possible. And yes it is possible. I am a good example for it because I work (external, not here) with multiple clients at same time and they are fine with it, they know about it.

For instance, one of my clients is low-budget-company and they wanted to limit to 10 hours and pay low. For my qualifications, I would reject the job because the payment were too low. With this even it makes no sense to work for them or with me because the work will take ages to get finished. They would lose time and money and me too. 

Now, they work with weekly rates and do not need to limit to 10 hours. This way we had both a good solution.

We both do not need to care about money, calcuation, or beeing surprised and more. They know they have to pay that money and are fine. 

And I am talking about my expierence with the clients. Many like that.

[petra_r]

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Bilal Y wrote:

Should Upwork offer something like this? I say yes!

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I say 'absolutely not'.