Freelancing: How to raise the issue of an annual rate increase

I’ve been freelancing for 15 years this year, and every year from 2005 to 2017 I sent out word of an annual rate increase in my year-end Thank You card.

The increase was usually small – around 10% – but it was consistent and it kept me in line with inflation and life in general.

Disclaimer: Last year and this year, I chose not to increase my hourly freelance rate, because a) there’s a definite recession in South Africa, and I’m feeling it, and b) I’m already at the higher end of what freelance copywriters charge in this city and country.

How to phrase a rate increase request

But I do get a lot of questions from my freelance colleagues about rate increase requests, how to word them and what the justifications might be if challenged.

So here’s a tip – not on the rate itself, because that’s a far more complicated answer, requiring my handy HOW TO WORK OUT THE RATE BEYOND WHICH YOU SHOULD NOT GET OUT OF BED slide – but on diplomatically opening the conversation:

– Start by drawing up an email to the decision-maker. Mention that you greatly value both their business and their loyal reliance on you as their chosen service provider.

– Segue into the fact that, especially in emerging market economies like ours, inflation and economic pressures are a reality.

– NB: It’s important that you not sound apologetic, defensive or desperate. This is a neutral business communique and feelings are not the issue here, nor are your monthly financial obligations.

– Explain that, given the business environment within which you work, your rates need to fall more in line with a) inflation, b) your experience, c) your expertise and d) the value that you add.

– Mention that, as you are applying only a moderate increase, you trust that the client will understand your position and feel free to approach you with any concerns or comments.

– Add that you respect their budget and would love to continue serving them at the highest level. NB: Do not mention that you’re negotiable. In my view, this weakens your position considerably.

A general nudge from me

It’s critical that you bring the decision-maker to a place of understanding that they are dealing with an expert.

Much like a top sales person asking for a raise, you’re requesting an upwards change in fee so that both parties are ultimately going to benefit. They continue to get your best work and attention, and you receive fair compensation from them in return.

Warning: It helps – like, a LOT – to be sure of their loyalty to you and of your unique value to them because, if they don’t care about retaining your services, they may well replace you with a cheaper option.

This is a very real risk. But it is one you can mitigate with my HOW TO WORK OUT THE RATE BEYOND WHICH YOU SHOULD NOT GET OUT OF BED slide, and (if you’re in South Africa) an upcoming course on this very thing. Yes, this is a specific nudge from me. Use it; don’t use it.

Best of luck with your annual rate increase request. And feel free to email me with questions.