Why You Should Not Work for Less Than You Are Worth

photo credit:  Jimi Filipovski

photo credit: Jimi Filipovski

One of the greatest challenges of freelancing or starting a business is figuring out how to price your services or products. Here's my honest advice after doing this for 6 years.

A brief disclaimer... It’s fine to give a discount (or better, throw in a freebie) to your BFF or someone you’ve known since you were 2. That's not what this blog post is about. This post also doesn't apply to someone who is new to their field and is in the process of obtaining clients and developing a portfolio or resume. I highly encourage people who are early in their career to do internships, do work for free, do personal projects; hell, do anything to get yourself some real work experience. This post is for the rest of you...

Figure out how to price your services or products

Do your research before deciding on your prices. I have read different methods for figuring out what your hourly rate should be based on your cost of living, etc. I have never followed these methods. Instead, like most things in life, I did it my way. I identified my competitors—or people who I would like to think of as my competitors, and started gathering information on what they were charging. Some people post their pricing right on their website. Sometimes you have to dig a little deeper and send them an email. Don't be afraid to ask people questions! You will never get an answer if you don't ask. 

Don't just look in your geographic area. When I was figuring out my pricing for last year, I checked out designers in the UK, Australia, and all over the US. I found other designers with a similar aesthetic to mine, with similar types of clients. People in other regions will probably be more inclined to share their pricing information with you because you aren't competing in the same geographic market, so they won't see you as direct competition. Added bonus, when I was checking out designers in other areas I got a ton of ideas and inspiration from looking at their portfolios. Tip for creatives: I actually prefer following creative people in other locations because there is a greater circulation of fresh ideas. I do a lot of nightclub flyers and I notice the San Diego clubs' marketing all starts to look the same after a while. It's fun to see what designers are doing in Miami, Paris or Tulum. (There is some REALLY AMAZING design & branding in Tulum, by the way!!) Sorry, I am getting side tracked. 

Stick to your guns

After you have done your research and you are confident that your prices are fair and competitive, STICK TO THEM. In my personal experience with freelancing, people will regularly ask if they can pay you less than whatever your standard rate is. I consider myself to be well established at what I do in San Diego after 6 years, and people still ask me if I will do a logo for a hundred bucks. Be respectful, but explain that your process takes you too much time for it to be worth what they want to pay. 

Keep in mind, there will always be someone who can’t afford you no matter how low your prices are. Please don’t feel bad about that. I’m sure there are things you want that you can’t afford. That doesn’t mean that you can walk into any store and leave with what you want for a fraction of the price, does it? I assume if you are reading this post, you are serious about being a freelancer or a business owner. Why should your business be treated any different?

The problems with settling for less

When people work for less than they know they are worth, it’s problematic for a few reasons.

  1. It messes up the market for everyone. When freelancers or small businesses try to out-bid each other and win clients by offering the lowest price, the perceived value of the service or product goes down. The prospective client then believes the true value of the item being offered is whatever the lowest price is. I've had people tell me $2500 is a ridiculously high price for a brand identity. Any savvy business person could tell you that a strong brand identity is one of the most important investments in your business, therefore I highly disagree! I also personally know someone who spent $30,000 on just a logo, so let's try to keep some perspective.

  2. You will start to resent the client. Resentment is never good. But it's hard to avoid if you are doing work for one client at $120/ hour, and another client at $40/hour. Every email they send you starts to annoy you. You start wondering why you ever accepted the work at such a low rate in the first place. And don't even get me started on how you will feel when a potential new client wants to hire you to do some work at your standard rate, but your schedule for the next week is full of the $40/hour projects. Grrrr!!!

  3. Other people will want the discounted rate. Despite the internet, good old-fashioned word of mouth is still how I get a great deal of my new business. If your client goes around telling everyone they know that you will work for $40, chances are the next person who contacts you will think $40 is your rate. It can be uncomfortable explaining that isn't the case.

The 3 big exceptions

  1. If you are CERTAIN that a project will be SO fun to do, it won't even feel like work... DO IT.

  2. If the client is SO impressive (and maybe even out of your league) that you can name drop them for the rest of your life... DO IT. They might even refer you other clients of the same caliber. (And make sure you put their logo on your website so people know how amazing you are for having worked with them!)

  3. If the project will be one of the most amazing pieces in your portfolio, DO IT.

Because every clever freelancer or business owner knows that when the above 3 factors come into play, the number on the paycheck is only part of the equation.

x, gretchen


I'm Gretchen Kamp.

I'm a graphic designer turned business owner who lives in yoga pants and is fueled by pizza and red wine. I am a soon-to-be fiancé to a handsome nerd, and a mom to a goofy snaggle-tooth rescue pup. I love traveling the world and teaching other female entrepreneurs everything I've learned in the last three years of full-time self-employment. When I'm not in my design studio, you can find me at Cyclebar or galavanting in San Diego with my semi-insane girlfriends.

Follow me on Instagram @gretchenkampandco

Gretchen Kamp7 Comments