7 Tips on Quoting Freelance Projects

One of the tougher aspects of freelancing is making sure you get paid a fair amount for your work. I'm sure every freelancer has at least one story of either getting grossly underpaid or not getting paid at all. So here are seven tips to help you improve your quoting.

1. "Discover" the client's budget. When you initially talk to clients, very few will volunteer their budget because they want to hire you for the least amount possible. So to get them to show their cards, try using a preliminary "discovery" worksheet for them to fill out. Have this worksheet ask questions about their goals, timeframe, and of course, budget (although you may want to assure them that this is not for quoting purposes, but to better "explore" possibilities). Clients seem to be more forthright when the process is formalized.
   
   
2. Spend time on your proposal. As nice as a potential client may seem, as agreeable as his terms may seem in your initial communication, always create a proposal and always put in the time to make sure it covers everything. And of course, don't start without it, even if the client is in a hurry. Make sure it covers both client and contractor responsibilities, expectations, requirements, payment terms, terms for changes outside the proposal, and everything else you can think of. Since clients often have a larger scope in mind than they communicate, a couple hours on this document could save you dozens later.
   
   
3. Charge by the hour. Instead of providing a project price and finding out later that you misquoted (and thus, you have to eat some costs), simply tie your quote to an estimated hourly rate and time frame ($70/hr for 40 hours). Not only does this make quoting easier, but clients understand that they are buying a block of time that you think will be enough to finish the project. They will be more forgiving if you need more hours (versus quoting a project price, which clients will hold you to).
   
   
4. Up your estimated cost by 10%-20%. Especially when you're starting out, it's natural to want to impress clients with "best-scenario" quotes that are lower than all your competition. However, you never want to be put in a position where you need to cut corners or give a subpar effort just to achieve a quote that you set too tightly. Furthermore, there are many hours that you will spend in communication, asset collection, and general administration (not to mention any snags you may run into). So do yourself a favor and give yourself enough time (because asking a client for more time/money is generally not a good habit). You will probably still be on the lower end of the quotes the client receives.
   
   
5. Set and manage expectations. If you're quoting by project, let them know the cost and timeframe for additional changes. If you are quoting by the hour and giving them a total time estimate, let them know when you're getting close to that quoted total time and whether you will be able to hit it. It may be helpful to have a clause that says if your total time is within 10% of your time quote, you will not charge more (this gives you extra money for finishing quicker and saves them money if you take a bit longer). Clients don't like surprises: keep them informed on your current time status and let them know at proposal time the possibility of "run-over" and charges associated with extra changes.
   
   
6. Collect up front. Outside of recurring maintenance work or very tiny projects (under $500), always collect some portion up front. This shows that the client is serious and much less likely to bail mid-project. You shouldn't have an issue getting 50% up front on most projects. If the project is pretty large, you may want to try 33% at the start, and another 33% at a predetermined milestone.
   
   
7. Set a final payment milestone. If you create websites, invoice the final payment the moment the site is live. If it's a print job, invoice upon delivered goods. And so on. Since the client knows these invoices are coming (and that their project is effectively done), use shorter payment terms as well. If you aren't exact and business-like about your payment schedule, clients will ride ther debt as long as they can.