We have to talk about money. All. Much more, much more often. Above all, it has to address those people who otherwise talk far too little about it: self-employed and freelancers. One does not talk about fees. If you ask others, the answer is always the same: “That has to stay between us.”
But does it have to?
Who said that?
And who does the confidentiality benefit?
There is no law that requires self-employed persons to keep their fees to themselves. There is only one culture in our society that sanctions exchange through money. This culture has to change fundamentally. The cult of secrecy about fees harms everyone – just not those who feel a desire to pay people badly.
If the secrecy does not benefit, it is clear: the people that do the job. Comparability could help you to better classify the value of your performance. It would be easier for them to charge reasonable prices. This could especially help those who are otherwise more cautious when it comes to quantifying the value of their work.
Service in special offer
I was once sitting in a group with others and a department head told her that she was a certain service has been offered for a very low fee. The others knew their way around and everyone laughed up their sleeves. So little money for such an offer? Absolutely do! On that day, one thing became clear to me: the self-employed are lone fighters. And not necessarily well informed about the value of their work. Employees and bosses who are better connected can thus dictate prices. They know more because they often work with several self-employed who are doing a similar job. That gives them more information and they can also better coordinate. Price cartels for cocoa beans don’t work any other way either.
The absurd belief in quality and bargaining power
Now one could object: If you do a good job, you will get jobs for more money. Sure, that’s right. The same applies to the self-employed: As demand increases, so does the price. And after six years of self-employment, I can say: There will be people everywhere who will do my work cheaper. Certainly there are people everywhere who are more expensive than me. And yet I continue to work. Because I negotiate my fees myself and only for myself. And wherever it fits, you work together. That’s how the market wants it.
So am I my own counterexample? The market will fix it and if you don’t master the rules of the game, you haven’t lost anything in the market?
No. Because it’s not that simple after all.
Ignorance, which is what you learn in economics, is an economic catastrophe. Actors who have to set prices under uncertainty can only guess. And that’s exactly what many self-employed people do in the first few years of their working life – and so do young employees. You’re guessing prices, what else should you do? There are lists on the net, but they show averages.
One moves in the tension triangle between “What if I don’t get the order because I am too expensive? “,” What if I ask too little and therefore don’t seem competent? “and” What if I sell myself terribly below value here? “
Especially with long-term cooperation, it is difficult to increase fees. It is possible with good justification, certainly. But if the performance does not change, it will usually be difficult to estimate a new price. That is why it is so important to find out about prices. The beginning of a collaboration sets an anchor for the future exchange of services, usually work for money. By the way, it’s not about squeezing out as much as possible and giving as little as possible. Neither party should see it that way – what kind of cooperation should that be? When clients and self-employed people demand a lot and want to give as little as possible, then they work together like a cow and a milking machine.
Disclosing fees is painful. This is due to the fact that almost everyone works for “too little” money. Then come the justifications: I enjoy that; or: They don’t have a lot of money, but I can do good there; or: this is for my brand; or the range.
But part of the truth is the old wisdom: Small cattle also make crap. My annual income has always been made up of the sum of the larger items and the sum of the smaller items. In other words: if I didn’t work regularly for the smaller sums, I would have less money. Not nice either.
The fear behind it could be that the prices are not oriented upwards. But below. Because it is now clear: someone else would do it cheaper.
The new culture of self-awareness
Only we don’t have to. Every service has a price. If I know exactly why I am charging a certain price for a certain service, then no one can ask anything else of me. We have to be able to justify our prices. High and low. And I can say very precisely why which part of my work costs how much.
Fees are often not directly comparable across different work. Not even between different people. I can’t say: Person X gets so and so much – that’s how much I want too.
Fees can, however, be set in relation to each other. And that’s actually what it’s about. I can say: person X gets so and so much – I will estimate the same in the future and here is my justification. Or: I ask for more because I do more. Or also: I get less, but I can see exactly why that is the case; so I either offer more or I acknowledge that my fee is already right.
Knowledge creates comparability
We have to learn to relate our work. This only works if we talk more openly about what kind of works we get. I’m not talking about open tax returns. I am talking about the fact that it should be normal to ask: “What do you get for it?” Only when this question no longer triggers a short circuit of horror in the brain can the self-employed get a complete picture of fees.
This is how a culture of self-confidence can emerge. Only those who want a lot of performance for little money benefit from secrecy. However, cooperation on equal terms is not possible if the information is distributed asymmetrically. And nothing else happens when freelancers or self-employed people work together with companies: They dare to enter into a partnership.
Partnership only works on an equal footing. Everything else brings us back to the cow and the milking machine. And their relationship is designed for squeezing and sharing. We shouldn’t let self-employed people do that to us.