4 Negotiation Tactics for Tech Freelancers
As a freelancer, you can live anywhere, plan your own schedule, and work on a wide variety of projects. On the flipside, all that freedom means it’s up to you to meet your income needs.
If you’re looking to land higher-paying freelance tech jobs, you may want to consider working with agencies. Often, agencies turn to contract workers with specialized tech skills—like engineers, developers, designers, and other creators—to supplement their in-house teams.
Freelance rates for designers and other technical workers can be all over the map. But, because agencies are highly motivated to keep their clients satisfied, they often pay competitively to attract the best talent for the job.
According to Jennifer Zamora, a career coach at SoFi and Korn Ferry Advance, “When you’re an agency, you have to deliver excellence for your client,” and that means finding the best freelancer for the job, not necessarily the freelancer with the lowest rate.
Zamora says that agencies may tend to base their rates for freelancers on data of U.S. salaries, and reputable agencies will aim to pay fairly. “Because the goal is typically to find the right talent for the right project at the right time, they don’t want to pay somebody under or over market.” That being said, “Everybody wants to control their costs,” even agencies.
So, if you want to work with agencies, what do you need to know about negotiating your freelance rates as a designer, developer, or other technical worker? Below we are highlighting four negotiation tactics you can try out the next time you are looking for a position.
1. Always be your own advocate
Jenny Grosa , a filmmaker and freelance producer, notes that it’s common for agencies to have a standard rate for contractors in your niche. “If that rate is lower than what you want, it’s your job to advocate for yourself and ask for more.”
For many freelancers, talking about money is the least fulfilling aspect of independent work. That said, it can be easier to negotiate with agencies than directly with clients, since it feels less personal. Groza says, “When I negotiate directly with a client, I tend to take their finances more carefully into consideration—it’s hard for me not to. I almost always get higher rates with agencies because I’m more stern in my negotiations.”
You can also adjust your quote based on the size of the agency you’re working with. Stephanie Newman , a feminist business coach who helps freelancers build sustainable creative careers, recommends asking: “Does the company have hundreds of employees on payroll? At that scale, they’ll be able to afford my standard rate.” A smaller consultancy might have a lower budget.
Even if the idea of negotiating is intimidating, Zamora says it’s standard practice. “Most agencies are willing to have the conversation if you come at it sincerely and authentically and make your case.”
2. Find the right agencies
To negotiate successfully, you’ll need to do your research. First off, make sure you’re pitching and quoting the right agencies. Zamora advises tapping into your network (including alumni and professional associations) and doing some internet digging to discover the key players in your space for your specific talents.
Seek out agencies who take clients that interest you—and keep in mind that they can get pretty niche. Zamora points out that “there are agencies working only with Fortune 500 clients, and agencies geared toward the gaming and entertainment industry, specifically,” for example.
Once you have a list of dream companies to work with, research those agencies’ needs, so you can speak their language. For larger and mid-market establishments, “it may be part of their philosophy to augment their full-time employee base with a contingent labor workforce to handle the ebb and flow of different projects,” Zamora says. In that case, make sure to emphasize the specialized skills you bring to the table. Show off work in your portfolio that fills a gap at the agency and directly applies to clients’ demands.
3. Know your value
On that note, it’s important that you go into negotiations with a clear sense of your value.
Zamora says that tech skills in general are in high demand, especially if you have a hybrid of creative and technical proficiencies. For example, “UX/UI designers are part-technical and part-creative, and that’s a hot skill.”
That said, don’t expect your credentials to speak for themselves. You should still drive home the value of your work. One smart negotiation tactic is to frame your services in the context of value, not cost. Instead of squabbling over your quote, make an argument that hiring you actually saves money.
For instance, imagine you quoted $10,000 to design a website, but the agency only wants to pay $8,000. You can change the conversation by focusing on results. Could your $10,000 website lead to $100,000 in added sales? In that light, your rate may seem like a bargain.
In Zamora’s experience, “this kind of reframing is always valuable, because it demonstrates that you understand the business and how you’re contributing to the bottom line.”
4. Stick to your boundaries
When it does come down to the back-and-forth of negotiating rates for freelance tech jobs, know your limits and stick to them.
Groza says, “I have two numbers in mind going into the conversation: my ideal pay and the lowest pay I’ll accept for the job.” After talking with the agency, you’ll likely end up somewhere in the middle. “You absolutely have to have these two numbers in mind,” Groza cautions, “otherwise it’s easy to end up with a rate lower than you want, and that creates resentment.”
It might be tempting to low-ball, especially if you’re excited about working together. However, Zamora recommends being “thoughtful about that strategy before you employ it.” If your quote is too high and the agency can’t meet it, the job might not be the right fit.
Groza agrees. She qualifies that there are a few reasons a project might be worth doing, even at a lower than expected rate: “Will it be a strong addition to my portfolio? Would I want to continue working with the agency in the future?” Or perhaps it’s simply a slow month, and you’re willing to take less pay than normal.
Still, it’s not a good idea to get into the habit of working below market value. “You begin to set yourself up for lower rates in the future,” Groza points out, “and it sets low rate precedents for the rest of the freelance community.”
If an agency just won’t budge on rates, consider negotiating the scope of the project instead. Newman notes, “I negotiate on scope, meaning I adjust the amount of work I contribute to the project.” That way, you can stand by your value while still being flexible. “I don’t lower my hourly rate,” says Newman, “but I will tell an agency, ‘Look, if this is pushing your budget, let’s figure out how many hours you can afford, and I’ll tell you what I can accomplish in that time.’”
Either way, your best strategy is to go in with a plan. “If you hear ‘no,’ you have to be ready to make a decision on whether you’re okay with that,” says Zamora.
And remember, successful negotiation isn’t just about getting a rate you’re happy with—you should also cover your bases when it comes to the definition of the work. Newman recommends “being crystal clear about the work you will do and not do, and communicate it both verbally and in writing.”
Negotiating higher rates might feel intimidating at first, but in the long run, it may lead to more career freedom and independence—likely the perks that attracted you to freelance tech jobs in the first place.
Still nervous? Negotiating can be stressful, but we can help. If you’re a SoFi member, sign up for a complimentary one-on-one session with a career coach who can help you plan your next move. Not a SoFi member yet? Head to SoFi.com to learn more.