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One of the main questions I have for people getting into entrepreneurship (especially new freelancers) is:
How are you demonstrating your value?
And I’m not talking about your value as a person on earth. As a human being. I can hear the heart-warmers and empaths now. EVERYONE has value.
To be clear, I’m talking about prices for your services. Last week, I discussed rates and in an effort to build on that conversation, I’m talking about value as in what you charge people to deliver your product or service.
We often misestimate our value. Sometimes (bear with me...this might be hard to hear), we overestimate what we can deliver. Sometimes, people who haven’t had a lot of experience with a particular type of deliverable think that they can nail it upon the first go-around. People can overestimate their value without having to demonstrate success, which can become problematic. Especially, when you are asked to replicate/scale past claimed deliverables. Yea, be careful with this.
On the other hand we can also underestimate our value. Or value the wrong thing… After all, we do have to create a portfolio to “prove” ourselves to our clients. But then, we don’t compensate ourselves appropriately when we do tremendous work. How should we demonstrate our value to get what we want? At the same time, how much do we give away for free?
One of the most crucial things you have to do when assigning service value is to continuously reflect on:
What do people pay me to do?”
What do they pay me to do now? and
What do I want to be paid to do in the future?
Personally, I make a table with four quadrants: what am I known for, what are NOT my strengths, where am I making progress, and what do I want to be known for. I fill out this table to not only see where I can improve, but also to see what things I can be monetizing. There is hope in the known for section, and the making progress section….
You also want to assess what the relationship is between the things that aren’t your strengths and the area that you are trying to get to in the “what do I want to be known for” quadrant. How long will it take me to get there? Where are my wins already? And what steps do I need to take to get there? But monetize the area that people are already paying you to do; those places where you are already known. That’s the cash cow.
Another crucial thing you have to do when assigning yourself a value is to stop giving things away for free. Seriously! We’re giving away so much because we don’t have a solid plan to demonstrate our value. There are people who don’t deliver..much..and get paid every single day. Why don’t you think you deserve to be compensated for what you deliver? If you keep giving away things for free, no one will pay you! If you don’t feel like you need money, how do you think consumers will feel?
If you won’t value your services, who will?
You don’t start at free; you start at a price! Figure out what value you have, and put a price to it. It’s normal to need help figuring out this price tag, and if you go on any social media site and look up the hashtag #businesscoach, there are tons of people willing to help you. You deserve to get paid, especially if you’ve built up a community that benefits from your services. What are you waiting for?
A word of caution
Maintaining your relationship with your client is essential to running a successful freelance business. If you can’t deliver something, be real about that. Don’t overpromise and underdeliver; that’s one of the worst things you can do. This can break ties with a client and have them not rehire you, no matter how much they like you. Of course, you should want to make money for yourself, but you shouldn’t charge a premium for something you’re just testing- that’s unfair to your client, and they will notice.
I hope that these tips help new and current entrepreneurs in their journey. I hope that you continue to take risks and find your value. The price only goes up from here!
Check out my Free Time/Value worksheet to help you think thru these tips.