Establishing hourly rate: how to do that properly?

Setting your hourly rate as a freelancer is one of the biggest challenges you'll face.

How do you price your work hour?
How do you properly set a rate that matches your industry and skills?
Here's how to nail it accurately! 💪

If you're a beginner freelancer and you've just gotten the opportunity to send an offer to a client, make sure to try using the estimation module in our ESTEAMATE app [link] and do some research

-> Ask friends from the industry,
-> Talk to acquaintances, maybe they work in companies that collaborate with freelancers or provide similar services,
-> If necessary, reach out to competitors – it’s tough, but at the start, you need to learn somehow.

If you already know how your competitors are positioned, it's time to evaluate your cost perspective. Here are a few elements that will influence your hourly rate.

Calculate Your Monthly Expenses
Sum up all your costs – rent, food, subscriptions, etc.
Divide this amount by 4 to get your average weekly needs.
Remember about alternative costs like tasks swings and time rounding.

Determine Work Hours
Consider how many hours you can realistically work each week.
The standard is around 40 hours, which corresponds to typical 9-5 hours.

Establish Your Baseline Rate
Divide your weekly expenses by your working hours.
This will give you your baseline hourly rate.

Golden Distance
Compare your cost rate with the market rate you identified
during your research. The larger the difference, the more room
you have for your potential margin.

If you are at the very start of your freelance journey, position yourself lower than your competitors while maintaining a very low margin. We know this is tough, but that's how beginnings are. Many of us started our first projects for a proverbial pittance just to build a portfolio, relationships, and a client base.

As more orders and clients come in, you'll have greater opportunities for diversification, including in the rates you offer. Clients A and B may have a rate of $30, but the next ones might get $35.

The more business you aggregate, the more flexibility you’ll have in offering rates. If this is backed by high-quality work and service, you’ll naturally begin to migrate to higher rates and different client groups, and that’s what we wish for you!

Never forget about diversifying your business. Maintain a diverse portfolio of clients and industries you work with. It’s unlikely that a crisis will hit all of them at once ;)

We’ll support you by giving advice and providing an app created exclusively for you – freelancers. It will save you time and improve the quality of your service... and your sleep!


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