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March 2, 2012
I'm beginning to transition from bidding sites to "real," outside clients (which is such a breath of fresh air!) and am learning that I've got a few gaps leftover from those sites. Namely, how best to accept payments, if an official contract is needed for each project, and how to use invoices.
Also, how do you guarantee payments? Do you lose potential clients when you bill up front? (This is what I'd like to do but I've gotten a couple irate clients when I mention this – always at the beginning of discussions – and wondered if that's normal.)
Thanks in advance!
I'm sure you'll get different opinions on some of this (and each can be valid). But here's what I'd say:
Accepting Payments -- I personally prefer Paypal for client payments. I can get paid immediately, which means I can start on a client's project sooner because I get paid up front). Invoicing is built right in. And I can very easily segment that income by withdrawing it to different bank accounts (paying myself to a personal account, putting some in business checking, some in business savings, etc.). Plus, clients don't have to have a Paypal account. They can pay via e-check or credit card if they prefer, right through your Paypal invoice. You just have to keep the fees in mind. Factor them into your rates up front and you won't have a problem.
Contracts -- Most colleagues will likely tell you to get a formal contract. While I don't have anything against having a contract, I almost never use them. And it's never hurt my business. That's because I get project details in writing via email first. Remember, a contract does not mean a formal document. Contracts can be casual. They can even be oral (although better in writing). A simple exchange of emails is often enough. As long as you have both an offer and acceptance, you have an enforceable agreement. Of course, I'm not a lawyer, so you might want to check with one first to make sure the standards here also apply where you live. Different countries and states can have different rules.
Invoices -- In the vast majority of cases, I just use Paypal invoices. In rare situations when Paypal isn't an option for the client, I send a simple Word document invoice.
Up Front Payments -- There really is no way to "guarantee" payments short of charging clients in full up front. Most freelance writers I know don't do this. I do. Benefits? You don't get screwed over. And you don't spend extra time on a project trying to chase down payments after the work is complete (time you aren't paid for). Does that cost you clients? I'm sure it's a turnoff for some people. I just don't choose to work with those people. When you build your reputation and you have regular demand, you have much more flexibility. I can do that because I can say "no" if a prospect insists on paying later. If you're starting out and you have few people coming directly to you with projects, you might want to be more flexible. That said, my clients don't complain about it at all. And for prospects I offer to do a smaller project (still up front pay) to show them what I can deliver before they commit to something like a minimum blogging order. It's like a trial to build trust. And if you have something like an ongoing monthly contract, you can let them pay you up front weekly instead of monthly if the workload is predictable from one week to the next. They just pay at the start of the week for that week's portion of the work. Even if you're not at a point where full up front payments make sense, I'd absolutely insist on an up front deposit before you start any work. Personally I'd suggest nothing less than 50%. But you can tailor it to each client or type of project (such as breaking some into two payments while larger projects are broken into three).
Hope that helps!
March 2, 2012
Thanks, Jenn! The information on up front payments definitely clears things up for me.
I've actually written contracts before in my fictional work, so I'll probably do something similar for my freelancing. Otherwise, I'll never hear the end of it from my lawyer brother-in-law.
I was thinking about going with Paypal when possible but I didn't realize they had invoice options. I checked it out and see where clients can pay by sending an invoice up front. I also realized that they have payment widgets to put on your website – have you ever done that and is it effective or just tacky?
I don't use the payment buttons for services because I don't often have openings for new clients. So I don't want them paying for an order online only to have me refund it due to availability. But I do use them for product sales (like e-books). They seem to be pretty much the norm for that kind of thing.
March 2, 2012
On an almost unrelated note, does anyone else get clients asking for "bulk" rates? I'm starting to get a lot of requests like this, even outside bidding sites. For example, a client recently asked for my rate per 500-word article. I gave it to her and she came back with, "Oh, since this would be a long-term contract and I'll be needing hundreds of articles, could we work out a bulk rate?" I had to resist the temptation of a snarky "Do I look like Costco?"
Is there any polite way to get them to realize that it's not like mass-producing burgers? I am a one-woman team here. It's going to take the same amount of time per article regardless of how many there are. Or am I being unreasonable and "bulk discounts" on articles are normal? (Haven't seen that in all the material I've read but, hey, I could have missed something.)
First of all, I'm sorry your comment got put in moderation. That's only supposed to happen for someone's first post. So the forum's acting a bit wonky.
As for bulk rates, their "normalcy" depends on the market. While you probably won't see it for print writing, many clients are used to seeing Web content advertised that way (either for blogging or SEO content). Personally I'm not a fan of it and don't recommend it for freelance writers. That said, I used to operate that way (not my most brilliant moment), and two of my long-term regulars operate under old bulk-centric agreements.
Whether or not it works for you will depend on your own market. If that's what they expect, you can get away without offering them for sure. But know that if competitors are largely doing it, that's what prospects will expect. In particular I've found that webmasters and marketers fall into the group that often expects bulk discounts for Web writing work. If your starting rates are high enough that you've left room to run sales and promotions (something I do recommend), then you could either stick to your guns and tell them that's not an option for you or you might offer them a one-time discount on their first order instead.
That said, no promises of long-term work should ever be taken seriously unless you've already been put under contract and paid. And long-term gigs are very different than bulk orders.
The only benefit of bulk discounts on your end is that they force the client to commit to a larger current contract -- not promises for more work later. For example, one of my client pays my normal rate for 1-4 blog posts ordered per month. If he orders 5-9, then he gets a small discount. If he orders 10 or more, he gets a slightly larger discount. So in most months, I get an order for at least 10 by the start of the month. It's good for him because he saves a little money. It's good for me because larger order from him means it's less work I have to take on in smaller projects that month, and it's more pay coming in up front. And if he orders less than 10, the higher per-piece rate means I don't lose as much money month-to-month. Still, I wouldn't go the bulk rate route with any new clients.
In every case, I can still earn at least the minimum hourly rate I set for myself. If you can't do that, don't offer discounts. And obviously you'll want to consider how badly you want to work with this client. The vague promises don't sound terribly enticing to me though.
March 2, 2012
No problem. There is a note at the top of post drafts that says, "New posts are subject to administrator approval before being displayed."
Thanks for all the advice, Jenn. I was feeling the desperation of thin prospects this month, so I already offered this particular client my base hourly rate. Lesson learned.
Hmmm. It's possible I tightened security before I went on vacation just to minimize spam. Anyway, they should go through okay now (possibly after one more post being approved due to current settings). I won't require all posts to be approved unless we need to lock down due to a spam attack or something.
June 6, 2011
I don't really use contracts as such, but I do have terms and conditions. I send them along with my quote, and they're worded in such a way that the client knows that, by accepting the quote, they're agreeing to abide by those T&Cs. I just don't get stuff signed. I used to get 25% upfront (if working to a project fee – it's harder if they prefer to be billed hourly) but I've upped that to 50% for new clients. Nobody's had a problem with it, and anyone that does I don't think I want to work with.
Can't really offer comment on 'bulk' pricing, as I do copywriting rather than straight content, but it sounds like the clients that expect you to give them price breaks for more work need a reality check! I might give a good, long-term client a small discount but definitely not a new client. It's not the way you want to start a relationship.
That's similar to what I do. There are general terms on my site which they agree to by entering into a work agreement. And we hash out project-specific details via email.
I'm glad to hear you're getting more up front now!
Hi Jenn – you said:
Accepting Payments — I personally prefer Paypal for client payments. I can get paid immediately, which means I can start on a client's project sooner because I get paid up front). Invoicing is built right in. And I can very easily segment that income by withdrawing it to different bank accounts (paying myself to a personal account, putting some in business checking, some in business savings, etc.). Plus, clients don't have to have a Paypal account. They can pay via e-check or credit card if they prefer, right through your Paypal invoice. You just have to keep the fees in mind. Factor them into your rates up front and you won't have a problem.
What about the opposite situation?
I have a client who insisted on switching to PayPal – I was fine waiting an extra week for a check. My first PayPal payment went through fine – no transaction fee for me. Now, a full month after I submitted my invoice, the client e-mailed asking me to "request payment" via PayPal. Wanting to be cooperative, I started to do that but it said I would be charged the transaction fee, not the sender.
I do a lot of smaller projects for this client (the client set the rates, not me), and the 2.99% fee (plus 30 cents for some reason) for the month's work will equal nearly half the cost of one of these projects. I wouldn't mind a $2 fee, even a $5 fee – but we're talking at least 10-times that per month. That adds up quickly.
Since it was the client's decision to use PayPal, it seems tacky that they're making their vendors pay the fee. Is it fair to tack the amount of that fee onto my next invoice? (Yes, I know this reads like a letter to Dear Abby.)
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