Do you offer bulk discounts if clients order a large number of articles at once? Have you ever had a client or prospect pressure you to offer these kinds of discounts, saying they'll order more if you lower the per-article rate? Many freelancers fall into the trap of offering bulk discounts because they think it will lead to more work. And it might. The problem is when freelancers think more work is always better. It's not. And it's a trap I fell into earlier in my career too (and I still have a few very long-term clients on pre-negotiated bulk rates).
The Case for Bulk Discounts
There are a few typical arguments freelancers make to support the idea of giving bulk discounts. For example:
- Offering bulk discounts encourages clients to order more, so the total dollar value of the order is greater.
- Bulk discounts can lead to easier work because you spend more time working for clients you're already familiar with instead of getting to know new clients, companies, products, and markets.
- When you offer bulk discounts you have an edge over the competition.
On the surface all of these ideas sound like they have merit. But they don't tell the whole story. Let's take a closer look.
The Case Against Bulk Discounts
All of those supposed advantages of offering bulk discounts for freelance services are shortsighted. Here's why they don't matter or don't always work out according to plan.
- The total value of the order doesn't matter. What you ultimately earn per hour does. You are not Walmart. You cannot purchase products in bulk to deeply discount them. Your time is a very limited asset. You can't create more of it so you can get away with charging less for each billable hour worked.You're better off finding clients willing to pay the rates you set (let's say the equivalent of $75 per hour) than discounting your time so you can work more with a single client (at let's say $50 per hour). That's lazy marketing. It hurts you in the long run, especially if these clients become regulars. And it puts you in an even worse position because you become immediately more reliant on a single client.
The more they order, the bigger the chunk of your total income they represent. And relying too heavily on one or a few clients can destroy your earnings if even one stops ordering down the road. If you market based on price like that, they often do stop ordering eventually because there's always someone else willing to work for even less.
- You should never be paid less for a project because you know the client and their market well and the work can therefore be completed faster. As you, your work, and your relationship with clients improve, you should be earning more for each hour of work, not less.That's how you get most raises as a freelance service provider. You don't constantly increase your rates. You get better, and faster, at your job (within reason -- having to crunch out content at breakneck speed is an equally unsustainable option). Your project rates stay the same but your hourly earnings increase as you improve. Anything else belittles your success in other areas.
- If you have any edge over the competition by offering bulk discounts, it's a fleeting edge at best. There's a reason this practice is more common in very low rate freelance markets. It appeals to clients who purchase based on price. Those are the same clients who will leave without a second thought if they find a lower priced provider who can offer a comparable service.I've said it before, but it's important enough to say it again. Any marketing professional worth his or her salt will tell you that you should never market services solely or mostly on low prices. It's not a sustainable business model. It doesn't make you competitive. It sets you up for future failure.
Those who constantly try to underbid each other aren't in your market if you're a professional. Leave that to the hobbyists and new freelancers who don't know any better yet. You have a better USP (unique selling proposition) -- the value you offer clients. And "value" doesn't equal price. Figure out what yours is and use that to market your writing services rather than low rates and constant discounts.
There's nothing wrong with offering the occasional sale. But offering regular discounts can hurt your business much more than it can help. Bulk discounts are some of the worst because they instantly undercut your primary method of earning more over time.
If someone wants to order in bulk, let it be because they value your work and not because you offered a lower price. And if you insist on offering bulk discounts never forget the minimum freelance writing rates you need to earn per project.
At a bare minimum, keep those discounts above that level to minimize your losses. Of course that only applies if you're charging more than the minimum to begin with. No gig is worthwhile if it doesn't help you reach your business or financial goals. In freelancing, it always comes back to hourly earnings.
Bulk discounts are a mistake in freelancing. That's a mistake I've made myself, as have countless other writers who aren't earning what they could be. If you have current clients on bulk discounts, re-evaluate the relationship. Calculate what you earn hourly. In my case I'm lucky and the projects still significantly exceed the minimum hourly rate I need to earn to reach my goals. But if that isn't the case, it's time to renegotiate or move on to other clients and other projects. And stop offering those discounts in the future. You don't have to lower prices to be competitive.
Do you offer bulk discounts? How does your hourly rate per project with the discounts compare to your normal rates? Have you ever calculated your minimum required freelance writing rates? If not, use our freelance hourly rate calculator to figure them out. Now how does your bulk discount project stack up? Hopefully you're still within your target range. If not, what do you plan to do about it?
Great tips – definitely has me rethinking some of my pitches!
I definitely fell into this at the beginning. I shudder to think how desperate I could sound. And I have some older clients still on it.
Here’s something I discovered that helps, put an expiration date on proposals. That way if you raise rates or get rid of bulk discounts, you won’t have it bite you in the rear when a prospect (who may be a client now) comes back with that quote.
I have definitely gotten better at sticking to my rates, but occasionally need a kick to remember that. Thanks for the kick, Jenn! 🙂
Excellent point about expiration dates Cathy! That’s so important, not only with proposals but when advertising any kind of sale or discount. If you advertise your regular rates on a 3rd party site, you should also at a bare minimum note that rates are subject to change. On your own site, once the rates change, they change. But old rates could be archived elsewhere for years. I still get an occasional inquiry from someone seeing a forum ad with rates from 6 years ago! They don’t bother looking at dates and don’t take the time to look at the site with current rates. And rates can change quite a bit in that amount of time.
Great analogy about Walmart! You are so right, it is seldom to your advantage to get into these arrangements, and it’s NEVER to your benefit to negotiate based on price. You want to work with a client who values your work, not someone who is always looking to shave money off the price.
Amen to that! If they don’t value your work beyond simple pricing, they’re not worth having as a client.
Hi Jennifer! You and I corresponded about a year ago. Since then, I’ve launched a pretty lucrative writing/seo business. As far as discounts…most writers I know charge way too little. The market will bear rates at least 25% more on the average than most folks are charging. So, no…I’m not for discounts in the least. Discounts are kind of like a toe fungus. They tend to stick around when you don’t want them to.
I’d say the market will bear far more than 25% over what many writers are charging. Those charging $10, $20, etc. for articles could often charge 10 times that much or more. It’s all about choosing professional markets instead of crap gigs like content mills and those frequently offered on bidding sites. But as long as they’re incorrectly perceived as easier, writers will continue to do that. They don’t realize how easy it is to compete in better markets because they often don’t have the confidence to try. And if they don’t value their services, no one else ever will.
I don’t have a problem with discounts in general. Just bulk discounts. One-time sales can be a great marketing tactic if you need to pull in work quick. I did that myself recently when a big client cut their order in half at the last minute, screwing with my entire monthly budget. So I offered one-time discounts to past clients and got some bites. Sometimes I’ll also offer discounts on one project if someone refers a new client I take on. The trick to using sales effectively is in making it clear that they’re for a limited time only. You also don’t want to offer those sales frequently. They should be rare occurrences and not a situation where clients know if they just wait another few weeks they’ll get another discount. I’m also a big fan of giving discounts to existing clients rather than new ones. It’s rewards-based rather than desperation and a willingness to lower prices for anyone and everyone just to get a gig. Of course even with one-time discounts it’s vital that your rates never dip below the minimum writing rate you calculated for reaching your financial goals.
Totally agree to everything you said here, but… How else freelancers are supposed to win competition over another project? And who said freelancer’s rate is permanently fixed? Supply defines demand, ya know…
There are many ways to get gigs without competing on price. This site has covered this issue countless times, as have others. Any writer wanting to run a serious career puts in the research time up front to learn how to market their services effectively without devaluing themselves; they don’t just jump into job boards and bidding sites where they’re put in a “low bid wins” mentality.
And no one said rates stay the same forever. But it’s never a good idea to set rates too low. The majority of freelancers never successfully transition from very low rates to professional level rates. While occasionally some do, it means they have to pretty much start their business from scratch again because the two markets (and how you need to market to them) are completely different. The rest give up and quit.
If you think you have to market on price, it’s time to rethink your value proposition. And if you don’t have any qualities or credentials that set you apart and attract higher paying clients, it’s time to start building them.
If you’re a hobbyist, charge whatever you want. Very low rates and underbidding practices won’t affect you a great deal if you’re happy just earning a bit of spending money. But if you’re trying to manage a writing career, earning a living at it, you have to be more responsible about the planning and marketing side of things to earn at a level that meets or exceeds all of your needs (and that includes all benefits like sick days). If you aren’t doing that you either didn’t properly calculate what you need to charge yet or you’re targeting the wrong market.
Remember, if clients can’t afford the rates you set and they expect you to get into bidding wars and lower rates, they’re not in your target market. A requirement of a target market is that they are able to afford you.
In 18 years as a commercial freelancer, I’ve never been asked to offer bulk discounts. But, I suppose if you offer them to a client unasked, they’ll take ’em. But, if the clients hasn’t asked, why in the world would you bring it up? 😉
The only exceptions I see – though this may be a different issue – would be in the case of 1) retainers, and 2) huge projects. While I’ve done precious few retainers in my professional career, many writers do them successfully. In essence, someone’s purchasing a set block of your time every month (X# of hours at X rate).
Typically, if they move beyond that number of hours, they’re back on the clock, but if they don’t use all of them, they still pay the full retainer amount (though, certainly some clients may negotiate some sort of “rollover” time component).
In this case, because the writer is being given a guaranteed chunk of money, they’ll often base their calculations on a slightly discounted hourly rate (but not $50 vs. $75; more like $65 vs. $75, or $115 vs. $125). Knowing you can’t count on X$ every month is worth giving up a little.
The other is in the case of a large project, like, perhaps, ghostwriting a book. Given the size of a project, which could quite reasonably consume 15-20 hours a week for months on end, it’s not at all uncommon to base one’s project rate on a lower hourly rate than normal. Again, guaranteed paycheck for an extended period of time.
I wouldn’t necessarily go out of my way to offer it, but if a client suggested it (AND I wanted the work), I’d likely give them a break.
Good post!
PB
I could possibly see it for retainers. But I also can’t see any good reason for using retainers in freelance writing. I did as a PR consultant and they’re fine in consulting. But it forces you into that hourly rate structure where you have to account for your time rather than the end product, and I’ve never found that the best way to work as a writer. It immediately pits the client against the writer where they’re watching the clock and you’re expected to work at absurd speeds.
As for writing books, I would never offer a bulk discount for that. It’s far more work; not less. And that doesn’t justify earning less.
Then again, I’m not sure writing books is comparable to writing articles or Web copy. So I wouldn’t develop a rate structure for one project based on one of the others in the first place.
The only work I do on books is for myself currently, and I prefer to keep it that way if I’m going to put in that kind of time investment. (And if you’re willing I’m sure I’ll pick your brain again for a new indie publishing site I’m launching in coming weeks as a side project to the book I’ll be self-publishing over the next year — first draft down, soooooo much editing to go.)
But even with e-books and some longer reports, they have a very different rate structure than articles. Certain things come to more per page, others come to less. It often depends on the overall research involved. White papers will also go for more than Web content writing for example because of the different style of work and research involved. And e-books vary a bit more depending on the subject matter and the kind of research the client expects.
You make a good point about not offering the discounts up front. That was a mistake I made years ago when I moved to online writing. It just seemed to be what people did. And then I got a reality check and realized the people doing that weren’t my competition and the clients expecting it weren’t in my ideal target market. So I cut the habit and haven’t looked back.
Hi. I have a question… I was recently being considered for a long-term article writing job that in the end went to someone else but they did ask me to quote them for a series of bulk articles ($ per word). I started to do some calculations and I was going to lower the rate per word, the more articles were ordered but after reading your article now I’m not so sure. Has anyone else had a similar situation? I can see most people have lowered their hourly rate, not the word rate but I suppose the principle is the same. Please advise as now I’m torn!!!! Thanks
Hi Sabrina,
Did the client specifically say they wanted a lower bulk rate? Or did they just ask for a rate on what happened to be a bulk order?
I would say if it sounds like price will be a primary factor in them considering you, and that would mean significantly lowering your rates, that they’re not the kind of client you’ll want in the long run anyway. Clients who do this up front seem to be much more likely to try to talk you down even further throughout your relationship with them, with the always-looming threat that they’ll hire someone less expensive.
My personal choice is to quote my normal rate to any new client, regardless of quantity. I no longer offer bulk rates to new clients, and my business is much better for it. Buyers like to use one excuse — by lowering the rate you’re guaranteeing yourself more work. But there’s a downside you also need to keep in mind. By taking on bulk work you hurt the diversity of your income streams. It makes you overly-reliant on specific clients and can severely hurt your business should that client leave later. It’s dangerous to get too comfortable with bulk gigs, especially if it’s a one-time gig with no long-term relationship already established with the client. So to some degree, there’s more risk involved. You’re being asked to trust that this client would keep ordering to justify the lower rate. They don’t always do that consistently, even with good long-time relationships in place. That also allows a single client to monopolize your schedule which can cost you other gigs at your normal higher rates because you may have to turn down other projects in the meantime. So charging your normal rates protects you. It gives you income to cover what your time is really worth to you (that’s why you set rates there in the first place, right?), and it means you won’t lose money on an hourly basis if you commit to the large gig and then have to turn down others because of it.
Just my $.02.
Hi Jennifer,
Thanks for such a quick response. What you say makes perfect sense and cover the issues that concerned me most but it is basically the conclusion I came to as well after really thinking about it. I have turned down other work in the past because of clients that expected me to be at their beck and call at any time of the day and that is not why I got into this business in the first place. In their email they asked me to quote for 150, 300, 450, 600, 750 and 1000 articles asking me for my rate per word for each set which to me implies they expect to see a difference in price. I’m going to stick to my normal rate and see what they say because at the end of the day I have to devote time to delivering the work so I shouldn’t have to lower my rate. It’s always great to come across others willing to help and offer advice so it is really appreciated. Thank you very much and I’ll be watching your blog 🙂
Always glad to have you here at the blog Sabrina. 🙂
For what it’s worth, I think you made the right choice. Some of the quantities they’re looking at would involve an insane amount of work. And the more hassle the job, the more it should pay (not less). And who knows? Maybe they’ll be interested in ordering some articles at your regular rate. If not, don’t sweat it. Just remember it’s an opportunity to devote that time to an even better client. 🙂