Why is it so hard for some people to charge their worth? This is something I’ve seen a lot over the last 16 years of helping businesses grow — where people find it particularly hard to demand, charge, or discuss their value. The most implausible part is that most of the people I’ve found who struggle with this tend to be the most hard-working, ethical people. Here are some of the main reasons why (from my own experience) some struggle more than others.
Social economic background
Often the people who come from the humblest beginnings aren’t exceptional at asking for decent money for their services. It could be the fact that they have seen struggles in the past or are struggling financially themselves and are sympathetic to the client or employer.
Some put the brakes on charging their real value because they aren’t totally convinced that they are good enough. This can go back to their childhood, lacking positive reinforcement from peers, or it could be the first time out in the market after university and they’re struggling to convert theory with practicality — even though they just finished the theory, they still need to learn on the job. A big question surrounding self-value is how much to charge when people feel they are still gaining experience.
Simple math is not so simple
Working 9–5 in the corporate world won’t help you understand your worth as an independent contractor/freelancer — so when many people begin their entrepreneurial venture, they think to themselves, “how can I charge $400 per hour when I was earning $50 in my employed position?” Remember you drove to the job with your car, you need to pay for fuel, and you need to pay your own super, insurance and more. An experienced business consultant can help you factor in all of things.
Want to please — at any cost
Some want to make their managers happy, but this is a practice that belongs in charity work because when these kinds of actions fall under the wrong manager, people can easily be manipulated and taken advantage of.
There are simple steps to take to solve this little dilemma:
· Research your award and understand your hourly worth
· When self-employed, add your overheads to the hourly rate and uplift for profit
· Ring around and find out how much likeminded people charge
· Get to know what your overheads are made of, so you know what the actual profit is after your hourly rate.
· If you are fresh out of Uni and struggling to convert theory with practicality, charge less but ensure you are growing and learning to the level where you can charge with confidence because you had the chance to prefect your craft.
· If you want to “go in” at a lower rate (to secure the business) ensure that a sign of “scaling up” is included in your contracts, especially if you’re hitting targets and adding value, otherwise this low entry level is there to stay
And remember … if you provide a good service, ethical solutions and fantastic results, they will be pleased, and your hourly rate won’t be the point of the conversation. Just do your magic with conviction.