BUSINESS AND MARKETING: Business and Marketing Forum Business and Marketing Articles

Adjusting your rate for older clients

COW Forums : Business & Marketing

<< PREVIOUS   •   FAQ   •   VIEW ALL   •   PRINT   •   NEXT >>
Jean-François RobichaudAdjusting your rate for older clients
by on May 29, 2011 at 12:43:57 am

Three years ago I took the plunge and entered the video field full-time, quitting an unrelated career in the process. I already had extensive experience in editing, compositing and motion graphics, and I had a good network, so I didn't have too much trouble finding work as a freelancer.

After 3 years, I charge new clients more than I used to, but my old clients still get my original rate, which I feel is on the low-side (though not ridiculously low). They're the ones who gave me my first few solid contracts, so I feel bad about charging more. Still, I think it's time I update my rates for my most trusted clients, but how should I go about it? Should I pre-emptively call (or write) these clients to make them aware of the rate increase? Or should I just tell them the next time they call? "Hi, oh by the way, I now charge $X"?

Also, I started out working at clients' studio on their own stations, but today I find myself working more and more on my own equipment. How much extra should I charge a client on a daily basis when I work on my own equipment vs. their own? Assuming my hardware adds up to around $5000, plus software, and taking into account other home office costs (not very high though)...


Return to posts index

grinner hesterRe: Adjusting your rate for older clients
by on May 29, 2011 at 3:15:44 am

You may be thinking backwards, man. Rates continue to fall due to technology prices falling. If you are able to charge what you use to, man that's awesome. I use to be able to charge 450 an hour for post while today, man it's pretty hard to get 200 an hour for much more capabilities than what was paid twice for for half the capabilities.
bottom line... if you have an old client that can't afford your services, wish them well. Mean it. and feel it knowing they will come back within the year eager to pay your old rates, having felt the burn in letting their interns bag em for a while.



Return to posts index

Mark SuszkoRe: Adjusting your rate for older clients
by on May 29, 2011 at 11:16:56 pm

I think I have to agree with friend Grinner here. If you feel guilt, pro-rate the new rates or bring them up in stages or extend payment terms or something. Offer to work with them to help make the transition, but
if your rates have to go up, the clients have to keep up, or part ways.


Return to posts index


Bob ZelinRe: Adjusting your rate for older clients
by on May 30, 2011 at 3:07:46 pm

this is a hard question - you want to keep your old good clients happy, but you don't want to give away your work. Back in NY, where I had so much work, and so many clients, I had the luxury to say "these are my new rates - take it or leave it" (I was polite about it !) - but now, in Florida, in the bad economy, where I don't have my phone ringing off the hook for me to come in - NO, I do NOT raise my rates to my old loyal clients, as I do not want to risk losing them in this economy. This has become a very sensitive subject for me recently, as I have to travel sometimes 90 miles to get to some clients (Orlando to St. Pete) and gas has become VERY expensive, and I "lose" about 40 bucks in the round trip in gas, so I am in that dilema as well. If things pickup back to normal (one day) then yes, I would raise my rates accordingly. But for now, I am grateful for the work that I have.

Bob Zelin



Return to posts index

grinner hesterRe: Adjusting your rate for older clients
by on May 30, 2011 at 7:08:38 pm

It's not all that hard of a question. We all know the best way to weed out a client is to raise rates. It boils down to: do ya wanna keep doing work for em or do you not have the time for them anymore?
Nobody can answer that question but the person asking it. In my world, I'm freakin tickled that decade old clientele can still handle my rate. When I bid flat rates on projects for new clientele I try hard to givemyself a raise. I do that by working faster, not based on a higher hourly rate.



Return to posts index

Patrick OrtmanRe: Adjusting your rate for older clients
by on May 31, 2011 at 5:54:43 pm

I agree with you both, but I wonder if other professions are effectively cutting their hourly rates. Like plumbers, for example.

----------------------------
PatrickOrtman, Inc.
Los Angeles Digital Agency and Video Production Company


Return to posts index


Bill DavisRe: Adjusting your rate for older clients
by on Jun 1, 2011 at 5:16:20 am

Having had a plumber out to the house within the past week, I can say with some authority that most of them they are NOT cutting their rates. The 1 hour visit with snaking two lines and re-setting a toilet wax ring that had been compromised by an incompetent installer resulted in a $225 bill.

I intellectually understand that in an economy where a smaller bar of soap costs MORE than a bigger one from two years ago - and a basic meal at McDonalds is likely to run $7 a person - prices are increasing and measurements of value are declining everywhere.

But I also believe that if you leave the IMPRESSION that you're as concerned about value as your clients you leave yourself in a better position than if you just jack up the prices in order to hold your margins.

If that same plumber had indicated when writing out the bill that yes, hourly rates had gone up - but the work was coming with an extra guarantee - that as a "valued existing customer" they would guarantee me priority service the next time or done ANYTHING to build a perception that while they had to charge full rates -they were even trying to provide value in the exchange, I would have been left without the feeling of being quite so ripped off.

Instead, they communicated NOTHING except the large bill.

It's that FEELING. That IMPRESSION that they didn't really care about how I felt about the transaction nor want to keep me as a customer badly enough to share my concern that's going to make me reach for a DIFFERENT number next time.

Maybe that's the real lesson here. Your rates themselves are hardly ever the issue. It's the perception of VALUE in the customers brain that makes them comfortable calling you again. Seldom just the price, unless that price is poorly explained.

For what it's worth.

"Before speaking out ask yourself whether your words are true, whether they are respectful and whether they are needed in our civil discussions."-Justice O'Conner


Return to posts index

Jean-François RobichaudRe: Adjusting your rate for older clients
by on Jun 3, 2011 at 3:36:52 pm

Thanks to everyone for your comments.


Return to posts index

Steve WargoRe: Adjusting your rate for older clients
by on Jun 5, 2011 at 8:57:21 pm

Well, what you might consider is charging the new rate but give them some free time based on their continued loyalty.

However, some people look a the number under the hourly charge column and never look at anything else.

With the economy floating around and equipment getting cheaper, it's difficult to get past the perception the some people have about hourly rates.

Steve Wargo
Tempe, Arizona
It's a dry heat!

Sony HDCAM F-900 & HDW-2000/1 deck
5 Final Cut (not quite PRO) systems
Sony HVR-M25 HDV deck
2-Sony EX-1 HD .

Ask me how to Market Yourself using Send Out Cards


Return to posts index


Neil HurwitzRe: Adjusting your rate for older clients
by on Jun 7, 2011 at 5:21:05 am

One of the most successful publications in our industry,
published continuously for about 50 years and is about as close
to a money tree as you can get is the MPE guide book.
That thin yellow book that we have all seen and used at some time.
The key to their success has been the fact that once you take out
an add they never raise your rate as long as you keep it continuously active so lets say 20 years ago you took out a half page add for lets say 500 bucks and kept it in there till now, you're still paying the same 500.00 But if you let it lapse one issue you go up to the new rate which might be 1,000.00 A tremendous incentive to never letting it lapse. Grandfathering rates to old clients
is a sure fire way of holding onto them. Try to slip a rate increase
in and it's like giving them permission to look around. Not a good idea in today’s world.
Huey Long once said "If your not getting something for free, well then you're not getting your fair share"


Return to posts index

Bruce BennettRe: Adjusting your rate for older clients
by on Jun 8, 2011 at 6:14:42 pm

Hi Jean-François,

Bob, Grinner and Steve have very good input/advice on this subject. Here’s one thing I do that relates to Steve’s words, “what you might consider is charging the new rate but give them some free time based on their continued loyalty.”
When it comes to this kind of stuff (charging old rates for older/loyal clients, taking on annual projects with cut budgets because of the bad economy, delivering more than what is budgeted for, etc.) on the final invoices, I list my “normal rates” line items as if there was no discounts, and then at the bottom, I list a “negative 1” quantity line item with “Discount courtesy of BMMP” to bring the projects in on budget. Whenever I “give away my money,” I always document it on my invoices so the client can see that they are getting more than they are paying for, hopefully creating client loyalty.

Best of Luck!
Bruce

Bruce Bennett
Bennett Marketing & Media Production, LLC
Creative Inspiration: Documentaries for those who love to create … and to be inspired.


Return to posts index

Patrick OrtmanRe: Adjusting your rate for older clients
by on Jun 8, 2011 at 6:41:09 pm

Yes, if you do not document the discount then your clients won't know it's there. Seeing it in black and white makes the difference.

----------------------------
PatrickOrtman, Inc.
Los Angeles Digital Agency and Video Production Company


Return to posts index

<< PREVIOUS   •   VIEW ALL   •   PRINT   •   NEXT >>
© 2017 CreativeCOW.net All Rights Reserved
[TOP]