4 Tips for Renegotiating Project Rates
April 25, 2011
It’s a common situation with no easy resolution: your original quote for a project was woefully low compared with the amount of work that ended up being involved. What went wrong? Perhaps the client’s needs changed or the second draft bombed or maybe you ran into some tech glitches that caused delays. Regardless the reason, you now have a heap of revisions on your plate and need to change the terms to ensure you get paid for your extra time.
In certain cases, it might make the most sense to simply take the financial hit and finish the job for the original price. But sometimes – like when the project threatens to eat up too much time you’ve already set aside for other clients – freelancers face difficult conversations with the customer: a negotiation for more money. We asked a handful of pro negotiators (freelancers, writers, web designers and consultants) for their perspective on how to get through that tough talk:
1. Be Clear with Your Argument
Try to establish parameters around revisions and redevelopments from the get-go. Put plenty of effort into developing the contract and the scope of work at the beginning of the project and you’ll find yourself in a better position to request more money should it come to that. Ask yourself: how many major rewrites are you willing to offer the client for the price quoted? How many times would you be able to redevelop the customer’s website given the pay involved? Your goal is to come to an agreement with the customer for a certain amount of work for a certain price. And if you and the customer agree to the terms of the project – and if the scope of work does change – the original contract will help reinforce your request.
2. Know When to Speak Up
Patrick Côté, head of web design company Transformer Studio, said it’s no good waiting until the end of the project to mention that the customer could be dinged for 20 per cent more than expected. That’s no way to impress a client. If the job is sliding away from the original quote, it’s best to bring it up with the customer as soon as possible, to avoid confronting the client with a nasty surprise (read: your invoice) when all is said and done.
3. Expect Feedback—Maybe Even Friction
Your client will almost definitely come back to you with feedback after reviewing your new price. That said, your client might also place complete trust in you that your final invoice will accurately reflect your work. Web consultant Chris Wightman told us that the team he was supporting on a particular project decided to tack an extra 15 per cent onto the invoice – without talking to the customer first – because the scope of the project grew over time. The client paid the full amount with no questions asked but Wightman said he was surprised that the customer didn’t balk. This is hardly the norm, so in general it’s best to keep communication open and flowing.
4. Trust Your Judgment
Freelance writer Sherry McPhail said she always charges by the hour, making it easier to charge according to the exact amount of time involved. But she also said that sometimes she knocks an hour or two off the invoice, particularly for returning customers when the project takes a bit longer than expected.
Côté said that he’s heard of others using estimates instead of locking in the price of the project at the beginning to give designers some flexibility if the project balloons out of scope. He pointed out that it could be difficult to get clients to agree to a flexible pay structure, and even if you have that flexibility, are you really free to explore it? A bill that’s some 50 per cent above the estimate probably wouldn’t make the client all that happy.
All in all, it seems best to work with the customer in the beginning on a contract or scope of work that both sides are comfortable signing. Then if the project changes or the amount of work required increases significantly, you’ll have a common starting point for a conversation about the changes happening with the project and the fair compensation required for moving forward.