How To Get 50% of Your Freelance Fee Up Front --And a Whole Lot
More!
This is valuable content from my free online newsletter, the
FREELANCER'S BUSINESS BULLETIN. In the April 2004 issue I shared
with my subscribers the secret to getting at least 50% of your
freelance fee up front, plus a whole host of other important
requirements for your freelancer's business. It was FREELANCER'S
BUSINESS BULLETIN subscriber and copywriting expert Susan Fantle
who asked for a discussion of this topic because she had
recently encountered some difficulties with clients. In her own
words: "I've been in this business for 23 years and only in the
last two years do I finally see the need to have a contract with
new clients." Now I've seen a lot of contracts in my freelance
life, but none more complete or protective of a freelancer's
interests than my own. And I'll share its elements here so you
can create your own contract, or perhaps improve the one that
you use. But before we get started I'll make a couple of points:
The first concerns semantics: Somewhere along the line I read
that the word "contract" is negative and off-putting, and after
some thought, I had to agree. So I call my contract a "Fee
Agreement," which I think is friendlier and sets the tone for
the positive and equally respectful working relationship to
come. You might think about doing the same for your own
contract. Point two is that you should always, always use a Fee
Agreement and get it signed and faxed (or emailed) back before
starting any work. When you work with the proper forms you are
telling your client that you are a professional, and your client
will then treat you with the respect you deserve. Much of the
success of the freelancer/client relationship is built upon how
you conduct yourself in your financial transactions. In my Fee
Agreement I always make it clear that I will Invoice for half
the fee up front, upon receipt of the signed Fee Agreement. That
way the client has agreed to pay an up front fee of 50 percent.
Then I email the Invoice, which instructs the client to send the
check via FedEx or another overnight delivery service. Since I
tend to work with mid-size to large companies, I never have a
problem getting my up front fee or having it delivered over
night. My feeling is that clients are in a hurry to get their
copy and are at their most agreeable at this stage. However,
once they've received their copy, there is no incentive the rush
the check. So I send a final Invoice "due and payable upon
receipt," instructing the payment to be sent via regular mail.
Since I work directly with the client, this arrangement works
well for me, however you may need to be more flexible depending
on whom you work with, or what market you're working in. For
instance, ad agencies may ask you to collect 100 percent at the
back end, especially if the job is small and fast. For very
large jobs, paying in thirds is also common. And small
businesses may prefer to pay in thirds if their budget is tight
(and it usually is). And then, of course, there are those pay
arrangements that include bonuses or royalties, which you will
most often find in the business-to-consumer side of direct
marketing, among very large mailers. More and more I'm seeing
commission arrangements -- a very good thing for the copywriter
who also can bring valuable marketing expertise to the table.
Does anyone ever get paid 100 percent up front? The answer is
yes, but I've seen it rarely. Recently one of my coaching
students was paid 100 percent up front for a very small job
worth $300. And another student was paid in the four figures
from a sole-proprietor entrepreneur, who obviously understood
that the copywriter realized the risk involved with working with
a risk-taking marketer. My advice is to try for 50 percent, and
if the client balks, proceed very carefully if you proceed at
all. If the client has problems paying you now, before you do
the work, it's a very serious red flag. You're better off to say
no, and spend your time marketing yourself to find a better
client. A Quick List of What Should Be in Your Contract if
You're a Copywriter or Other Business Freelancer: - A very
detailed description of the job, listing virtually everything
you will do - A deadline for the work to be completed - Revision
terms - Payment terms - Late payment terms - A description of
what will be included in your services - A description of what
will not be included (interviewing and creating testimonials,
for instance) - A policy on how change orders are handled (you
charge more if they make a significant change after work has
been done) - Ownership (you own the copyright until you've
received full payment) - Indemnity (a legal disclaimer holding
you harmless against any legal charges such as libel and
copyright infringement; you don't need to add false advertising
since you won't be doing that anyway) - An agreement for the
client to share work samples and results (so you can use them in
your promotions) Don't be so anxious to get the work that you
fail to get a signed Fee Agreement and payment up front. Getting
payment up front is an effective screen, and evidence that you
are a professional.