Budget Jobs & Cheap Freelancers: 5 Reasons Not to Be Cheap

Really, how bad can budget jobs be…

Budget jobs can seem attractive, but in reality, there are a lot of hidden negatives to working on the cheap. Nobody wants a budget result – right?

We get it – freelancing is a tough business. It’s so competitive out there that some freelancers feel their only way of earning any money is to lower their prices to beat the competition. But, does this strategy ever work out? Who are the winners in the end?

Now, the idea behind being a cheap freelancer is pretty obvious, and easy to see why it’s an attractive strategy to many freelancers out there.

You’re a struggling freelancer trying every trick in the book you know to get work. Why try so hard, when you could just lower your prices? If you lower your prices, enough so that you become the cheapest, surely the client will pick you every time… right?

Well, to be blunt, there are a number of reasons why cheap pricing and undercutting are not only bad for you but bad for your client too. This practice of cutting corners and charging pennies (cough, Fiverr, cough) is ruining the freelance industry for everyone involved.

Being cheap creates price wars:

No, this terror isn’t set in a galaxy far, far away – this is an issue we’re facing right now.

The trouble with lowering your prices is that before long, the competition will do the same. Clients will visit a freelance website, look to hire a freelancer and find a group of you competing for the same low prices. Then what? Do you lower your prices to beat them again?

This, my friend, is a price war between cheap freelancers. And now you’re trapped in an unending spiral to the bottom. What happens when you get there? Will you work for free!?

What will happen, is that you’ll be stuck unable to cover your costs and make any money. Game over.

Setting low prices can be illegal:

Undercutting, or predatory pricing is in fact illegal.

A pricing strategy that creates a monopoly, charging at dirt cheap prices is something that prevents other new freelancers from gaining entry to the business.

It’s often difficult to prove, but if you’re found to be doing it on freelance websites, it’s illegal under competition laws and could put you out of business.

What budget jobs really say about you:

If you’re good at what you do, why are you charging peanuts? There’s a lot of perceived value that goes into pricing – so, if you’re using one of the best freelancer sites, but charging at below average, clients may think there’s something wrong… 

Let’s say you buy a pair of shoes for £10. Your expectation is probably that, before long, they’ll be uncomfortable and fall apart.

However, if you spend £100, you expect those same shoes to be much higher quality – fitting like a glove and lasting for years. Makes sense that a client may feel the same when hiring a freelancer, right?

The same rules apply to how you price yourself as a freelancer – if you’re cheap, clients will think you provide a cheap product. You even find that good clients with interesting, well-paid work will actually steer clear of you.

In contrast, you’ll be attracting clients who won’t care as much about the quality of the end product.

Surely, this can’t be the type of work you think of when you imagine a freelancing online job?

Budget job = cheap freelancer:

The more prices go down, the more clients perceive the value of the product to be cheap – a.k.a bad news for everyone.

The further increase in budget jobs and cheap freelance rates, the more clients will expect to pay as little as $50 for a logo design, because they think logos are produced quickly and cheaply. Then, when the actual going rate of a logo design crops up, they become outraged!

Really, it’s the freelancer’s duty to educate the client on just what goes into their craft and why the client should be happy to pay a bit more.

Rabbit in the headlights syndrome:

Clients often get blind-sighted by price.

In an ideal world, the client would visit a freelancer platform and hire the freelancer who is most suitable for their needs – regardless of price.

If you go into the pitch shouting ‘I’m cheaper than everybody else in the market – hire me!’, the client’s focus is immediately shifted to price.

You should be selling yourself on the back of the fantastic quality product you can provide which will fulfill all of your client’s needs. Not how cheaply you can do it. Whilst your clients are focusing on price, they aren’t focusing on the amazing end product they’re going to get.

This type of deal is bad for both parties, as the client will end up with the wrong freelancer, and, you’ll be stuck with a project costing you twice what you actually earn from it!

It’s time to get real – budget jobs and cheap freelancing just isn’t the way forward.

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