Do you offer bulk discounts if clients order a large number of articles at once? Have you ever had a client or prospect pressure you to offer these kinds of discounts, saying they'll order more if you lower the per-article rate? Many freelancers fall into the trap of offering bulk discounts because they think it will lead to more work. And it might. The problem is when freelancers think more work is always better. It's not. And it's a trap I fell into earlier in my career too (and I still have a few very long-term clients on pre-negotiated bulk rates).
The Case for Bulk Discounts
There are a few typical arguments freelancers make to support the idea of giving bulk discounts. For example:
- Offering bulk discounts encourages clients to order more, so the total dollar value of the order is greater.
- Bulk discounts can lead to easier work because you spend more time working for clients you're already familiar with instead of getting to know new clients, companies, products, and markets.
- When you offer bulk discounts you have an edge over the competition.
On the surface all of these ideas sound like they have merit. But they don't tell the whole story. Let's take a closer look.
The Case Against Bulk Discounts
All of those supposed advantages of offering bulk discounts for freelance services are shortsighted. Here's why they don't matter or don't always work out according to plan.
- The total value of the order doesn't matter. What you ultimately earn per hour does. You are not Walmart. You cannot purchase products in bulk to deeply discount them. Your time is a very limited asset. You can't create more of it so you can get away with charging less for each billable hour worked.You're better off finding clients willing to pay the rates you set (let's say the equivalent of $75 per hour) than discounting your time so you can work more with a single client (at let's say $50 per hour). That's lazy marketing. It hurts you in the long run, especially if these clients become regulars. And it puts you in an even worse position because you become immediately more reliant on a single client.
The more they order, the bigger the chunk of your total income they represent. And relying too heavily on one or a few clients can destroy your earnings if even one stops ordering down the road. If you market based on price like that, they often do stop ordering eventually because there's always someone else willing to work for even less.
- You should never be paid less for a project because you know the client and their market well and the work can therefore be completed faster. As you, your work, and your relationship with clients improve, you should be earning more for each hour of work, not less.That's how you get most raises as a freelance service provider. You don't constantly increase your rates. You get better, and faster, at your job (within reason -- having to crunch out content at breakneck speed is an equally unsustainable option). Your project rates stay the same but your hourly earnings increase as you improve. Anything else belittles your success in other areas.
- If you have any edge over the competition by offering bulk discounts, it's a fleeting edge at best. There's a reason this practice is more common in very low rate freelance markets. It appeals to clients who purchase based on price. Those are the same clients who will leave without a second thought if they find a lower priced provider who can offer a comparable service.I've said it before, but it's important enough to say it again. Any marketing professional worth his or her salt will tell you that you should never market services solely or mostly on low prices. It's not a sustainable business model. It doesn't make you competitive. It sets you up for future failure.
Those who constantly try to underbid each other aren't in your market if you're a professional. Leave that to the hobbyists and new freelancers who don't know any better yet. You have a better USP (unique selling proposition) -- the value you offer clients. And "value" doesn't equal price. Figure out what yours is and use that to market your writing services rather than low rates and constant discounts.
There's nothing wrong with offering the occasional sale. But offering regular discounts can hurt your business much more than it can help. Bulk discounts are some of the worst because they instantly undercut your primary method of earning more over time.
If someone wants to order in bulk, let it be because they value your work and not because you offered a lower price. And if you insist on offering bulk discounts never forget the minimum freelance writing rates you need to earn per project.
At a bare minimum, keep those discounts above that level to minimize your losses. Of course that only applies if you're charging more than the minimum to begin with. No gig is worthwhile if it doesn't help you reach your business or financial goals. In freelancing, it always comes back to hourly earnings.
Bulk discounts are a mistake in freelancing. That's a mistake I've made myself, as have countless other writers who aren't earning what they could be. If you have current clients on bulk discounts, re-evaluate the relationship. Calculate what you earn hourly. In my case I'm lucky and the projects still significantly exceed the minimum hourly rate I need to earn to reach my goals. But if that isn't the case, it's time to renegotiate or move on to other clients and other projects. And stop offering those discounts in the future. You don't have to lower prices to be competitive.
Do you offer bulk discounts? How does your hourly rate per project with the discounts compare to your normal rates? Have you ever calculated your minimum required freelance writing rates? If not, use our freelance hourly rate calculator to figure them out. Now how does your bulk discount project stack up? Hopefully you're still within your target range. If not, what do you plan to do about it?