The past year was a wake-up call for all of us in terms of our work setup. And for many, that meant stepping into the world of freelance for the first time. Whether the pandemic forced your hand or this move was a long time coming, we caught up with photographer Sarah Oden to get her advice on the most puzzling component of being a freelancer: getting paid.
Take it away, Sarah.
Value
First things first, think through the value of your product or service. What pricing makes it worth you providing it? Don’t low ball pricing in order to get clients or you will quickly become overworked for payments that are not sustainable long term. However, if you are just starting out, don’t set your prices comparable to a seasoned professional. Be honest with yourself on what you’re offering and the level of experience and quality you have.
Whatever product or service you are providing, try to also look at its value through the eyes of your consumer. What is the final use of the product? How long and often will it be used? Does it have sentimental value? Think about what a consumer will find valuable about your product and include those points in the discussion of pricing.
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COGS
Read up on “cost of goods” models online and implement one into your business. Being a photographer, I read COGS articles specifically relating to photography services, so try to find articles related to your field. This ensures you understand how much it costs to run your business and how much you need to charge in order to make a livable salary.
The main variable in a COGS model is that in the end, you must also factor in your local market and product desirability. Just because your COGS calculations say you should charge a certain amount, doesn’t mean your target clients can afford it in this market. Look at the pricing of similar businesses in the area and compare it to what you offer and what you would like to charge. Being a little more expensive is fine if your product is worth it, but pricing too high means you will price yourself out of any sales.
Livability & Taxes
Keep a spreadsheet breakdown of monthly income. Looking at past years shows how your salary has grown and what months tend to be busy and slow. Since freelancers can make drastically different incomes month to month, it helps you figure a baseline average on what your monthly income is and how it compares to what you need it to be. Seeing which past jobs have been the most lucrative also helps you know which clients to target.
Being self-employed means paying into taxes quarterly or at the end of the year, instead of an employer taking them out for you. Stay informed on how much you will need to pay in and account for that cost when setting prices.
Sarah Oden is a commercial photographer based in Little Rock, Arkansas. She specializes in fashion, portrait and product photography for a wide range of clients. Learn more and contact her on her website.
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