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What the heck should you be charging as a VA anyway?
One of the biggest challenges of being a Virtual Assistant is deciding what and how to charge for your stellar services. Actually, all freelancers have to deal with this question. Figuring out a perfectly balanced rate can mean the difference between running a successful VA business and constantly struggling to find clients and pay the bills.
A lot of VAs charge by the hour while others offer project pricing, but did you know that there’s a third option? Day rates! We love this option because it can fill a significant gap in your pay structure.
A day rate is a fee that you charge to cover an entire day dedicated to one client. Yup; you set aside your entire day. No gaps. No distractions. You become a completely dedicated resource from 9-5 (make sure to take a break for lunch though), and you charge a premium for it.
With a day rate, your clients pay a set amount of money up front for a fixed number of hours of work. That’s it. Regardless of the state of their project, at the end of that 7 hours, you’re finished—or they pay you more money to book another day.
It’s kind of like offering a block of hours for your work, but instead of letting the client spread that work out over a whole month, they get one dedicated day. BOOM.
You might be thinking, “Eh, I charge per project and I’m doing fine. Why bother confusing clients by offering them a day rate?” And to that, I say, “Because you could be making WAY more money for WAY less work!”
What’s that you say? I’ve got your attention now? Alright good, then listen up. Here are some of the reasons why day rates rock.
One of the big challenges with being a VA is that every time you switch from doing one task to another, one client to another, one project to another, you lose time in between while you shift gears. And if you’re charging by the hour, that’s time (and money) that just flies out the window. This is what’s called the leaky bucket, and it’s something most solopreneurs have to deal with.
Enter the day rate: No more leaky bucket! Since you’ll be dedicating yourself to one client for the whole day and they’re paying you a flat rate for your time, your bucket stays full and paid for. What a difference that can make to your productivity and bank statement!
One of the worst parts of being a freelancer is invoicing. Even if you have a great invoicing service, you still have to deal with clients who might retroactively think you’re charging too much, they might question how much time you spent on a task, they don’t get around to paying on time, or they might want to expand the scope of a project without warning…
With a day rate, you don’t have to think about any of that. Day rates should always be paid in advance, so you don’t have to worry about chasing clients to shake them down for money!
One of the problems with project pricing is that you don’t always know how long something will actually take. With a day rate, it’s not even an issue!
This is such a great solution when a client asks you about an unusual project, something you haven’t done before, and you just have no idea how long it will take. They might want you to quote on the project, but you just don’t know where to start. Well instead of guessing out of thin air, a day rate could be the perfect solution!
Tell me if this has ever happened to you: You’re hired for a project and, at first glance, you estimate that it will only take you around seven hours to complete. So you get working on it. Then, around the three and a half hour mark, you think, “Uh oh. This project is WAY bigger than I originally thought it would be. Guess that means I didn’t charge enough and there’s nothing I can do about it now…”
With a day rate, the scope of the project doesn’t really matter. You aren’t charging per project; you’re charging for your time. If the client pays for seven hours of your time, that’s the set amount of time you’re going to work, whether their project is finished or not. If the client wants to expand the scope of the project, tell them you’d be happy to do so… at your day rate pricing.
If a client wants your undivided attention for a whole day, then they’ll need to pay a premium for it. I recommend charging as much as 20% more than you usually would for your hourly rate. You’ll be offering huge value to your client by giving them an entire day of your time without distractions, and for that, they should pay a little more than usual.
If you’ve ever had a client who wants to monopolize all of your time, or questioned your rate for a project, offering a day rate is a perfect alternative for them. Rather than hire you for a huge project that will cost them big money over a few weeks, they can instead hire you by the day for a predetermined rate.
By the way, if you’re ever quoting on a project and the client balks at your project rate, your day rate gives you a fantastic one-liner as a counteroffer. You can say, “If the project rate is a bit outside your comfort zone we could do a day rate instead.” Trust me; they’ll bite like fish on a line!
Plus, clients just love the idea that they’ll have you focusing on nothing but them for an entire day.
Not only that, but you can often squeeze in a day-rate project in between your larger scale projects, meaning that the client will get their deliverable sooner. It’s a solid win-win.
Now, I’ve met lots of VAs who prefer project-based rates, and that’s totally ok. Offering a day rate might not be for everyone. If you’re someone who instead likes to focus on the entire project, rather than work by the hour, then that might be the rate structure for you. But if you’d like to try something a little different and offer your clients a day rate, you might discover that this is one of the smartest decisions you can make for your business.
So what do you think about the idea of a day rate? Will you start incorporating it into your business plan? I’d love to hear what you think!