I started at a little more than that, and maxed out at less before I retired. I increased rates for new clients, and did my best to encourage more work from ones that paid more, and more promptly.

What was mind-blowing was eventually discovering what one of my first clients had been charging its clients for my work. It was over five times what they had paid me!

Don't be embarrassed of your rates. If they're flirting with but not plainly past what potential clients are willing to pay, you're in/around the right territory. Additionally, explicitly the definition of successful deliverables in your SOWs - make sure that you get enthusiastic client sign-off on these criteria. This can only serve to make everyone better off when work is marked as complete.

Last, "Due on Receipt" with some understanding and grace is a lot better than having to send "Hey just wanted to check in about invoice #1113" emails 10 days after your 30-day receivables haven't come in.

I used to have one client who was otherwise both a good customer and a nice person but he was terrible for constantly trying to incrementally increase scope. It was always an effort during the SOW process to really nail down exactly what the deliverables were.

Even when they know your work is of good quality they will think that by being unaware of its worth you are probably not very experienced. Last but not least you of course get exploitative clients that way.

The worst thing you can do is offering free work for "friends". Often they will not even say "thank you" or use the actual work you delivered.

$350/hr+ was distributed database related consulting, and then started going North from there for increasingly niche and specialized consulting services. Though only on very rare occasion these days. The highest rate I've ever been able to negotiate was $1,000/hr. But, it was also for a very short engagement (~10 hours) for some especially weird knowledge I have about replacing critical mainframe infrastructure with commodity systems.

Point being, you might be surprised how much you can charge for the right services to the right customers who have a clear sense of need and appropriately value a solution.

Reason I'm asking is because I recently started freelancing in software/web development (about 6 months ago) and I think I'm doing okay. I love to design and think out all of the odd, interesting or difficult back-end problems and so far all of my clients love my work, and with that I'm slowly increasing my rate, started at 50eu/h ($55/hr) and am currently at 75eu/h ($82). This is all in Europe (The Netherlands) However I feel like I'm a bit stuck, the clients I'm able to find don't want to pay more then $80 and with that the work isn't as challenging as I'd like it to be. At the same time it feels like the clients that do want to pay more aren't looking for me.

To make it easier to charge more you have to go after customers who are less price sensitive, whose problems are costing them a lot of money, and who are accustom to acquiring outside help for things outside what they consider to be their core business & expertise.

In my case this was big enterprises. Nationwide law firms, banking & fin. tech. institutions, international distribution & logistics companies, etc.

It took a long time to build up to that point and to get access to those parts of the market. The way it worked for me was, early-on, I'd be doing smaller jobs for big companies. Sometimes with another vendor as an intermediary. So, I might work with Boeing or Lockheed indirectly, but I was fastidious about establishing direct personal relationships. Once I hit the media & marketing world, it was the same pattern. Work through an existing vendor of say Pepsi or Nike, and then make direct personal relationships that could grow later for their adjacent or orthogonal needs.

Eventually you have enough contacts and enough of a reputation that you don't need to leverage the credibility of intermediaries anymore.

I don't know that such a path would work for everyone for all kinds of work (everything I ever did was kind of esoteric for its time), but that's what worked for me.

This is gold. It happens far too often.

Happened like this: one very huge phone company wanted some very specific self contained component written in Java. They shopped around and did not find anyone willing to do it. My friend was working there and told them that he knows that genius consultant (yours truly). So they called me up and during negotiations I told them that I will do it for $20,000. I was prepared to bargain but they told me that I am very reasonable for that functionality. At no point they asked about exact time frame/hourly rate. They just said that the expect it to take no longer than a month.

Came home, fired up my PC and spent 3 very long days coding it. That was all about it. I wish I could nail contracts like this more often ;)

Meanwhile. This project required some imagination and multi-disciplinary knowledge. Sure the company have some geniuses but the company is huge multinational and for one department of their branch it was probably way simpler and cheaper to get someone from outside then shop their other brunch. Big companies are very bureaucratic

The thing is, it's not just some Kentucky Postal Service inc. but it is quite common in such BigCo's as Microsoft, Google, etc...

I've seen a lot of talent go in and out. Usually it goes out like this:

- PM is seeking resources internally, you could be reached out and be told on what they are trying to do. - The project can be complex or easy. Honestly it doesn't matter within the context of working for a company. As far freelancer, you can go on a nitty-gritty with the client on what it takes to do and justify your rates to them... for a already-hired developer:

- There's absolutely no guarantee they will incentivize you after all the efforts (working as a developer for a company). So it really doesn't matter if the project is super complex or not. Management is pretty stupid most of the time and they can't see the level of effort in things even if you break them out to them. Or they can simply be ignorant about it.

- I've said no. Usually I'm very driven with new challenges but I've learned the hard way that it doesn't matter at all. These days I just say "I don't know, sorry." and "yea I just never worked on that". I've seen people gone the road of talking about training courses so they could stall management a lot if they don't have many options.

Why? Because there's really no end goal. You are already hired within the company. Employers take for granted that that's reason enough for you to do it.

Honestly it could go many ways. Not all companies will be as awful as mine. If you are lucky enough to land with a company that recognizes your efforts and incentivizes you for it good for you. I don't think many people are that lucky.

I'd say, believe me there are quite a lot of geniuses, but I've yet to meet a fool that takes the bait of taking more complex work in without proper incentive. (excluding fresh graduates and those still in their starting years)

I did not say they were not. Some products said company did develop do require a genius. But from my experience those tend to compartmentalize in appropriate departments and the rest is just average.

Of course there are always exceptions.

It turned out they couldn't produce their compliance documentation and that was delaying the release of a new drug.

The solution wasn't that complex but it did involve the intersection of several different skills. They had in-house devs but none of them wanted to touch it, to them it looked like a problem, to me it looked like an opportunity.

It wasn't an opportunity for them. The Risk/Reward was probably insanely bad. If they fixed it, they are just "doing their job" and get a pat on the back. If it was that big of a deal though, if they screwed it up its possible they would get fired.

   > To them it looked like a 
   > problem, to me it looked 
   > like an opportunity.

I currently work as a lube tech for a local dealership. (Saving up for the future, and they have better hours and pay than $LocalFastFood.) My coworkers dislike A) vacuuming vehicles and B) doing tire rotations- because both of them take time and effort.

I like doing both of those- they take time- which means I get paid (job security!) and also helps the customer want to come back (arguably more important than any time savings from skipping a rotate or not vacuuming underneath floor mats.)

The difference was that they worked for different big shots.

This section laid out the things that might sound like they are related but would not be part of the enhancement. For example, a speed-up of the filesystem might have a non-goal of adding new file types.

Just one question. How do you approach future clients?

When you charge per hour you make sure you are getting payed for all the work you are performing. However, I often see it recommended that you charge per week (best) or per day (next best). I believe the rationale behind the per week (or per day) pricing model is that it weeds out the customers that are just looking for the cheapest labor they can find, leaving only those that are serious about a project and can commit to paying reasonably for the work.

Per hour is not adequate for this type of work; you're delivering a product or service that will increase your client's bottom line, you're not a seat-filler who punches a clock. I charge in the smallest increment of time that I believe I can provide a meaningful impact or deliver a complete solution. When asked for a quote I translate my billing into weeks, as in $X000 per week. Accounting for admin tasks and paperwork, back and forth emails and phone calls, plus showing off the work completed and waiting for approval/notes, a week often seems like not enough time (I can't count the number of times a client asking for a simple font change took literally a week to order and get approval on). There are very rare instances where I know I can accomplish a task in days instead of weeks and if the client asks, I will bill in days instead.

"My rate is $X000 per week and my initial estimate is that this will take XX weeks to complete. I require an up-front retainer of X weeks to get started and I bill every two weeks after. Who should I address the initial invoice to?"

I would typically never reveal this tip, but here it goes: "I bill weekly and my normal rate is $X000. For you I would be happy to reduce that to $X000-20%." The client is told up front that they are getting a discount without having to ask for it and the Discount line item on the invoice(s) very much help in getting that invoice paid faster. The secret is that the rate quoted is always 20% higher than what my ideal number is. I make it rain discounts on everyone.

No one wants to have the rate conversation but I've noticed that clients who don't shy away from that talk or flinch at your rate will not be a problem. Clients who complain that you cost too much will be a problem. Politely suggest you are not a good fit for their project and end the call, you're better off. If you get to the point that your non-flinching clients say yes a little too fast to your rate, increase it. You want a little resistance, but not much. Saying yes too fast means you need to charge more.

And lastly, this is not about what work "costs" or "market rates", this is about what your completed solution is worth to your client and how much it will increase their bottom line. You're playing a different game so stop charging like you're mowing lawns or digging ditches. Charge more.

That being said, if you’re working with someone who actually deserves a discount - a client referred by a friend, a startup on a budget, etc., then it’s totally fair. I’d just be wary of tossing around discount claims to everyone.

One thing I disagree with is the automatic-discount thing. Firstly, I think it's cheesy. Makes me think of street vendors saying "...But just for YOU, I have a SPECIAL price!" Secondly, I think it cheapens the perceived value. As in, "Why is Joe throwing around 20% discounts? Is he desperate? Is he not confident in his abilities?" Etc.

In this instance what’s the tactic to increase the price you’re quoting the client? Are they not going to think it’s weird you’ve changed your mind about the price?

One may try to calculate (in their mind) how much time they will take to complete the project and then quote a fixed amount based on the no. of hours that came up.

I'd feel more comfortable presenting a fixed project quote for a creative project than a software project, because in the case of a creative project I can choose to dedicate a fixed amount of time, and have the result - to be judged subjectively - that I was able to produce in that time.

In the case of software, I would need to keep working until it objectively meets requirements. The quality of software I deliver doesn't degrade smoothly under time pressure, it falls off a cliff.

which is the whole point of the agile manifesto

which is why agile fails under most circumstances, as having fixed time, requirement and budget but under scrum and sprints is anything but agile.

And while both need to deal with unclear goals, figuring out what it is the client and truly needs, in one case you're selling what they have, or what they are, in the other you have to make something they want and will be able to use, support and sell.

That's very often a tremendous amount of uncertainty to work through.

Edit: also what this comment says https://news.ycombinator.com/item?id=21729677

Edit 2: And this one, featured some time ago on HN https://erikbern.com/2019/04/15/why-software-projects-take-l...

Don't punish yourself by charging only $100 for the hour you worked on it.

Know your value - which in capitalism depends on market demand - and charge accordingly.

When you are a distinguished expert you can charge more of course as well.

Make a name for yourself and ensure that everybody knows upfront that you are not a "cheap outsourcing" drone.

Why wouldn't ur hourly rate be 100k then (vs $100) ?

- what if it takes you a bit longer, 2 hours, is it fair to charge the client 2x?

The point is, the client wants a car, not an hour of car-making.

Also, the moment you provide an hourly rate you get compared to other hourly workers, whether it’s fair or not. “What?! $100k an hour? Even our lawyers cost less!”

Except most clients don't know what they want in such clearcut way before the project begins.