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thevasam

Raising rates with existing client didn't go down well

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If I looked at it from a monthly basis rather than hourly, he actually pays me about five times more a month than any of my other clients (because I do so many hours for him) - but I'm working 10 times as hard for him as I am for any other client!

 

So this is what I need to be thinking... I don't have the time or energy to focus on my other clients any more at the moment, because I'm doing so many hours for him. I'd much rather be focussing more on a select few clients and giving them even better results than what I am right now - but I simply can't because he takes up all my time. I'm trying to pour from an empty cup.

 

That's exactly what you need to be looking at - the big picture. Yes, you may be bringing in more revenue gross than any other client, but the cost to you is not worth it. You've probably heard it before, but it bears repeating often, that when you get rid of an energy drain, it opens up the way for something more positive to come in.

 

Take care,

Dawn

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That's exactly what it is, an energy drain! My new clients are asking for help with much more challenging things, where I'm learning all the time and I love it! I know what I need to do. Thank you for your help everyone :)

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I agree with all of the above. I think people get stuck on that "hourly" rate comparing that to what they would pay an employee. Only the benefits of having a VA (employment taxes depending on where you live, paying for time not used for actual work, benefits, hourly guarantee, etc) SAVE them money in the long run. People like that need to remember they are paying for contract labor, not an employee.

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On 1/19/2016 at 12:20 PM, thevasam said:

One of my first clients joined me 18 months ago and I gave him a ridiculously low rate of $10 ph, which I was happy with at the time because the work was a bit of data entry here and there, filtering some emails, things that I could do while I was listening to the TV, just to earn a bit of extra pocket money (you know how it is! I was new!)

 

Anyway, my business grew, as did my responsibilities for this particular client, in a huge way - I became the first point of contact for his customers, took responsibility for all customer support, working with Infusionsoft, WordPress, my 24 hour response time became almost instant response time, etc, etc.

 

I approached the subject of a raise with him last March, and it took him a few weeks before he'd reluctantly agree to go up - by $2 per hour!!!!

 

These days, my Infusionsoft skills, 'inside out and back to front' knowledge of his business means that he calls me his 'right hand person' and frequently says that I'm an integral part of his business. I'm averaging 15-18 hours per week for him at $12 ph.

 

I've also taken on clients in the past 12 months that are on rates of more than double what he's paying - and they are more than happy with what they are paying.

 

In December just gone, I decided to get a business plan in place to roll out in the new year, which meant trying to get my clients on a consistent rate level, and stop spreading myself too thin across too many clients. I thought if I could limit myself to 3 or 4 clients and bring this particular guy up to $20 ph (effective from February to give him some notice), I could focus on each of my clients more effectively, rather than doing too much for too little money and spreading myself too thin.

 

However, he was not pleased that I had spoken of a raise again before 12 months since the last increase (I'm 50/50 on that one, I understand it to a point, but then - it wasn't much of a raise and who wrote the rule that increases are only allowed every 12 months?)

 

He's refused to even talk about it again until April!

 

The thing is, I really love working with this client, I enjoy the role, I've learned a LOT over the past 18 months - but right now I am SO demotivated! He has a major launch coming up in March and I'm wondering whether he's thought process is he's going to keep me on until after then and then let me go and hire someone cheaper. What might bite him is that he'll struggle to find someone that not only knows Infusionsoft and all the other nuts and bolts of his business, etc, but that genuinely cares for his business like I do.

 

What do you think I should do? Even though he pays me the least per hour, he gives me the most hours and is therefore my best paying client per month. Saying that, I could survive without the money I earn from him. Do I cut my losses and spend the 15-18 hours per week looking for a couple more clients who will appreciate the value I bring? Or should I stick it out and see what he says in April? Even if he does keep me on, he might say "I'm only willing to pay $14 ph", which as you know is still at least 50% less than what he should be paying?!!

 

Thanks for any advice and sorry about the long post!!!

 

1.  You are a business owner, not an employee; do not allow a client to treat you as such.

2.  Re-address the issue of a rate increase by listing in detail what you were doing for him at your initial rate, then list what you're doing for him now, based on your specialty skills, etc.

3.  Your rate increase (NOT pay raise)  is based on the value of the service and results you provide.  

4.  If you don't get the rate increase, terminate your business relationship with him; this type of situation leaves little room for improvement on the client's part in this regard.

5.  Make sure you have a contract outlining the details and scope of the work you're expected to do and the rate at which you should be paid, including your scheduled rate increases.

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