So if I’m in the Search Engine Optimization field, but can do a lot of different things like technical and marketing copywriting and so on, I should charge $60 an hour since I made $60k a year?
Yeah, good points, my posts assume 1099 contracting (freelance) whereas the W2 stuff is more like what an agency will do for you.
Realistically, you can charge whatever people will pay and no more. But for completely independent work, that rule of thumb seems realistic. I have contractors (through agencies, but assume that the rate the agency charges me is the rate that you would charge yourself, if you were working independently) and employees working for me, and the numbers are generally within 10-15% of that “drop three zeroes” guideline.
(Which is to say, $50/hr is not necessarily someone trying to screw you, and might represent a normal wage, but $60 puts you in the ballpark.)
Well this is for fully independent contracting, for the time being at least. I know little about agencies that handle contractors though, but I should look into them. Any recommendations on that front?
Good lord. Wish I’d had that advice a couple years ago. I seriously low-balled my price when I did a year or so of freelance work (for the first time). I basically made a very small increase above my full-time hourly rate, so I ended up making about the expected amount each paycheck, but killing all my savings with the taxes.
Plus, when my freelance work dried up, my unemployment eligibility had expired, so I was probably worse off than if I’d just tried to look for full-time work in that period.
Freelance works great for some people, but it’s important to remember that finding your next gig should occur while your current gig is still ongoing. It’s definitely do-able, but not for everybody.
Well, it depends. It’s a good starting point, but you have to adjust for local conditions, competition, etc. A lot of that is just going to be random perturbations*.
Your writing skill only factors in if you do them for that job. If you have provable experience in those fields then you can add those as part of your skill set in an effort to broaden your market, but there’s a difference in perception between:
- SEO consultant
- SEO consultant (experienced writer)
- SEO/copywriting consultant
Figure out what you want to bill yourself as, then figure there are ancillary skills that make you more appealing for that primary thing. If you have two equally marketable but orthogonal skill sets then they should probably be advertised independently so that it doesn’t mix your message. Then you can be Brian Rubin, SEO Consultant to someone and Brian Rubin, Freelance Copywriter to someone else. I’d opt for the former since the latter pays for shit…
Also, keep in mind any potential clients will likely see this thread when they Google your name…
- When you start adjusting prices, it’s pretty much a feel thing. For example, you may start at $60/hour, but then find that the market is really more like $50/hour. Okay, you adjust to that. Your first gig you really need, so even though it’s only for 40 hours, you take it at $50/hour (discount for need). The second gig is lined up, it’s for much longer (3 months), so you stay at your $50/hour rate. The third gig comes in 6 weeks into your 12 week 2nd gig – well, you don’t really need it, you’re pretty happy, so you charge a slight premium since if you lose that gig** you don’t care that much, so you quote $60/hour. Hey, they took it, that’s a new baseline!
Into your third gig you get offered a very short term consulting gig, it’s only 8 hours but it’s local. Since you don’t need it AND it’s short term, you quote $65/hour…and they take it. Sweet! Now you’re nearing the end of your longer term contract, and someone offers a 6 month deal at 45/hour…hmm, hard to say if that’s worth it or not, etc.
Lots of little things like that add up. Over time as you get a feel for the market, your actual utilization rate***, you’ll be able to set prices into a narrower band.
One bit of advice I think is cheezy but works surprisingly well is to quote at odd rates. Instead of $65/hour, quote $67.25/hour. Instead of $50/hour, quote it at $50.75/hour. Employers then make the assumption that the price is set through some complicated formula instead of a seat of the pants thing =)
Something else you have to be ready for are deadbeat clients. If doing per-project type stuff, try to get some up front, some at beta, and some at completion, and make the completion acceptance terms pretty rigorous. If you’re doing straight up hourly, then just make sure you’re paid on a reasonable schedule (invoice bi-weekly with net-14 payment or something) instead of a net-30 with monthly invoices (which puts you at 60 days out from your first payment, yikes!)
** Assuming you do a good job and there’s a reasonable market, you’ll find gigs. You just have to be patient and can’t panic at each dry spell. You also don’t want to be the contractor that takes on 100 hour work weeks out of permanent fear that they won’t have a new gig next week…it’s an easy temptation though.
*** Another reason that 1099 contractors charge a premium is that their utilization is often not 40 hours/week. During the course of a year they may average to much lower fraction of that, but obviously that extra time is often spent hustling for work, learning new skills (unlike a salaried employee, you have to learn stuff on your own time unless it’s a part of the contract assignment), etc. and thus it’s not exactly leisure time.
tl;dr - some agencies will keep you in a stable and get you gigs, other agencies will be dictated to you by larger clients that don’t want to deal with individual contractor paperwork. In both cases, the agency will extract a fee.
more info:
Typically agencies exist for one of two reasons. The first is because your client is a large company and doesn’t like dealing with contractors individually, especially when n00b contractors can fuck up paperwork pretty trivially and get the employer into trouble inadvertently. To handle this, a client will often require you to go through some kind of contract agency, such that you never actually work for the client, you work for the agency, and the agency and the client have a general consulting agreement where they provide “an SEO consultant” but not necessarily “Brian Rubin, SEO Consultant” (but this is somewhat implied).
The agency extracts a fee for this, usually spread between the client and the contractor. For example, in your case maybe the agency charges the client $60/hour, paying you $50/hour, whereas the client could have hired you directly for only $50/hour. The agency is a transactional cost.
Some agencies are talent brokers instead of just HR/IRS end runs. Effectively one step above a temp agency. They may have clients that are always looking for artists or writers or whatever and they like to keep a stable of people available on call. Some will be exclusive, some won’t.
Best thing to do is to start acting like an employer, so start googling for SEO consultants and consulting agencies in your market, and then start asking them if they’re looking for people. Consider online market places as well such as Monster, RentACoder (if they still exist), elancer, etc.
It definitely requires a mindset that can handle that variability. But stacking gigs is vital, and in fact you have to be able/willing to crunch so that you can overlap gigs. Always Be Selling.
It’s also generally better to have 4 gigs at 10 hours/week than 1 gig at 40 hours/week just because the risk is distributed more and because you’re always working even if a client is flaky or slow.
Many clients are all “We need you now, get started tomorrow!” and when you drop everything to do that, they end up dragging on getting you contracts, specifications, and other required materials. Or something as simple as feedback. You do some work, show it to them on Tuesday, and now…you can’t do anything until they tell you their thoughts. But the boss man is out until Thursday, gets back Friday, is tired, doesn’t have time to look at it, then finally gets back to you Monday afternoon. And in the meantime you can’t progress (you can’t bill either) because they’re the bottleneck.
You can actually game this a bit in that if you find that you have 20 hours of work to do in the next 2 days, you can force a client into a bottleneck by sending them something and going “Hey, you guys didn’t specify this, can you let me know what you want to do?” knowing that they’ll like go one way 80% of the time. You end up looking diligent but what you’ve actually done is bought yourself 8 hours to work on something more urgent =)
(Note, while the above is true, it can also backfire, because for every control freak client you have, there’s going to be one that just wants you to make decisions and hand in something functional)
Multiple gigs helps with the bottleneck issue. And if you stack enough and make enough such that you assume X hours of income but actually average X + 10%, then you can take the occasional day off without panicking, or look at an incoming dry spell (hello Nov/Dec!) and not freak.
Ugh, man. That totally sucks.
Brian, do you have a separate, focused blog that demonstrates you are an expert in your field? If not, you could start by linking 1 or 2 articles on SEO per day, or doing short reviews of books, programs, and training packages. Then move on to articles that address challenges your potential employers might have. It keeps your mastery level up, shows you are doing something in the field during unemployment, and might be a good discriminator, depending on how that field works.
Tim’s advice is awesome, because your page could be something like “The fact that you’re reading this means that I know how to do my job” =)
#1 hit for “Brian Rubin SEO Consultant”:
Hah yeah I didn’t even go the extra step to make that connection. Try owning the top 4 or 5 spots on Google for your name - your blog, your resume, etc. Those lawyers and doctors won’t mind.
Yeah. I forget some people aren’t as self absorbed as I am. If you don’t know what comes up when you google yourself, find out. If there’s a problem there, either fix it or be ready to fix it.
Not sure if this has already been stated, but if you go the 1099 route keep in mind that you’ll have to pay self employment tax which comes out to 7.65%. Half of that can be deducted from your gross income.
I have no good advice, but I did want to offer condolences. If I had work available for you, I’d offer it, but I doubt you would want to move to nowhere Ohio (even though I really like it here).
Great tips all around everyone. I do plan on revaming my own personal domain to be more reflective of my own work (I have a gaming journalism portfolio that needs to be revamped), plus I have a geek blog that now I’ll have more time to update.
This! Some really awesome advice here. Start planning now! It’s still a really crappy economy out there. As far as applying for jobs, send resume’s out by the truckload. Even jobs that you think might be a bit outside of your level of expertise. Just because they advertise for a certain skill set doesn’t mean that is what they will get. Just don’t get too crazy with it!
Yep, we take all our contractors via agency because of the paperwork issue. Just simple things like standard NDA’s. For consultants we would sometimes hire direct, but the sort of consultant we hire would have their stuff together to make that easy (i.e. they have properly incorporated companies & invoicing capability)
Beware that some agencies have “no poaching clauses”, or prohibitive poaching clauses. I.e. if you are offered a full time job because of an agency gig, the agency is due large amounts of wonga as if they were a recruitment agency.
We had an amusing bust up with a large technical consulting company recently, because whenever we went to market we ended up not selecting them, but recruiting the people from them who had impressed us the most during the process…
The only thing I would add, other than condolences, is that I would not be afraid of recruiters. Don’t use too many, as you don’t want your CV shopped around by too many people, but definitely go and have a chat with someone.
Hope you find something soon!
As well as all the great advice on here, I’d suggest applying your SEO knowledge to your CV itself. A lot of recruitment firms over here trawl their database of CV listings in a way very similar to the average web search (or they did when I worked at one a few years back). If your CV is jam-packed with keywords and the like, it’s all the more likely to appear in searches written by consultants. All the better if you go back and gently refresh the wording once a fortnight or so to make sure it still appears active.
Good luck!