Deciding how to accept payments, bill your clients, and charge for your services can be really difficult.
You will see in the video above my thoughts on how to do it right. The short version is that you should charge as much as possible and focus on building a business system that works for you. I have made a lot of mistakes in this area including not charging enough for my services, giving deep discounts to my favorite clients, and not having a clear system for doing work for clients. I think the best solution is to simply charge hourly for work done or to have a retainer for work you will do. This way I get paid for the work I do and I give me clients a very clear idea of what they are getting. My clients invest money with me in exchange for my time.
If you are considering becoming a client, you can watch this video or read below to understand everything you need to about working with me. If you are struggling with these challenges for your business, you can use this video and post to do a little better than I did!
My New Business System for Charging Clients.
Thank you for watching this video! You will see in the next few minutes the details of my how I collect payments for my company as a freelancer which can be useful if you want to do this yourself or if you are interested in having me do work for you. Setting up a successful payment system is critical for the survival of your business system because this is how you get paid! Ambiguous or complicated payment systems can cost you valuable time and lost opportunities. I know because I have failed a lot at collecting payments prior to making this new payment system. What I have learned is that simplicity, transparency, and consistency are key to success. For me, this means I need to take the time to explain to each potential client my system from start to finish. If you are using this video as reference, I hope you can have an easier time than I did making a successful billing system.
How does my payment system work? You invest money with me and I invest time with you. This approach ensures that both my client and I know exactly what we are getting. A huge benefit to this is that my clients are encouraged to use my time effectively with this system. I offer two options for payment to give clients the choice of how they prefer the details to work. If a client hires me with oDesk, they get the benefit of having a third party track and charge for my work. If a client hires me directly, they enjoy a lower rate and prepay each week or month for a set number of hours.
How much do I work each week? I find I do my best work when I operate a balanced life. This means times for work, play, and rest. Work is allowed a maximum of 40 hours per week in my schedule with a maximum of 20 hours per week reserved for paying clients and the other twenty hours for creating articles and videos people can enjoy for free.
What value do I offer in the work I do? If you have seen my YouTube videos, you may know that I have the most highly ranked videos on Facebook advertising in the world. No other person or company has more videos collectively ranked as high as I do. Most of the videos were made in under an hour each with of course the 3 hour ones taking a bit longer! People in nearly every country have watched my videos and liked my company’s Facebook page. My company made one figure in 2011 when I started, 5 figures in 2012 when I first started learning Facebook ads, and six figures in 2013 when I took on hundreds of clients from more than 30 countries. In 2014, I have established myself as a worldwide authority in online advertising and digital marketing strategy. I have created sales campaigns for clients that are running now at a 10:1 revenue to ad spend. I have managed millions of dollars of ad spend and billions of ad impressions in the last 18 months. What really is cool is that I did all of this with no previous experience, no connections locally, and started out as a way to escape grad school and the 9 to 5 life I was looking at. Maybe my online research skills could use some work but I have never seen someone online that did this themselves in the isolation of their own home that genuinely cares about helping people succeed even if it is for free. The reason I have grown so fast is because for every one client I get, I help thousands of people do it themselves free.
How do you decide how much to bill per hour? When I started out, I offered the lowest prices I could to try to get the most work possible. What I ended up doing was working a lot and being pretty unhappy. Working a lot allowed me the time to learn a lot but rarely offered the chance to share what I learned. I worked so much by the end of 2013 that I stopped trying to get new clients and planned for a reorganization in 2014. I looked at what experts in other fields charge. My wife is an attorney. Her profession’s hourly costs generally range from $100 to $600 per hour with the most specialized areas of law toward the higher end. Celebrity movie writers and movie producers often charge hundreds of thousands per week to work. Bruce Willis thought a few million for one day of shooting was not enough. I have made myself into a class of expertise that you cannot get for much less than $300/hour at an advertising agency where you generally have to pay $10,000+ just to get them to “discover” what they might be able to do for you.
All of this leads back to the question of what I should charge per hour. After failing repeatedly to strike a good balance in this area, I have decided to charge as much as I can stand to charge per hour based on the effective competition for my time. If I charge less, I always end up doing more work for clients as compared to making videos and articles that are free for everyone. I also use the money I make to advertise the free resources I create so that more people can see them.
Before I talk about what I charge, let’s take a look at what most people that need my help choose to do instead. Let’s place you in all of these positions: hire someone in house, do it yourself, or hire an agency to do it. Let’s say to begin you hire someone in house. You probably will pay $15 to $35 per hour for an employee to do the work for twenty to forty hours per week. You will work hard to find a person that is the best out of the pile of resumes you get. The fact is you are most likely to get a person that has little specialized knowledge in what you need because so few of these people exist right now. Your employee is also likely to just be there for a check rather than because they really care about helping you succeed. Your new employee spends the majority of their week answering calls, trying to look busy, browsing Facebook, taking breaks, and generally trying to do as little as possible. You are lucky to get two to five hours per week of high quality work. To be fair, it is not their fault either. The 9 to 5 schedule imposed on most human beings is completely counterproductive for creativity. I wrote this at 4 am when I could not sleep. If they are doing that for you, you have landed a top 5% employee and you better appreciate them! More than likely, they spend the first several months trying to get on the same page with you which includes taking your time and distracting you from your work. Their work tends to be average at best. Over the course of a year, your employee’s average quality work has resulted in a bland online appearance that might make you feel just good enough to watch what your competitors do every day to see if they are getting ahead of you. Your employee has cost you $25,000 to $75,000. You think they might have sold some of your products but it is hard to tell what they did that you were not mostly responsible for. You wonder what would have happened if you had hired that Jerry Banfield guy to do a little work for you each week instead.
Another popular option is the do it yourself option. My free resources provide a ton of help for this option and this is what I did myself getting started. Let me tell you how bad I was at it despite being blessed with an intellect of a genius, a masters degree from the University of South Florida, and the arrogance of thinking this meant I could just do it myself. I knew almost nothing when I started trying to promote myself and I failed miserably at it. I wasted at least $10,000 on stupid Facebook ad campaigns, Google AdWords campaigns, and everything else you can think of. Assuming you can do a little better than me, let’s say you start trying now to use my resources to do it on your own. You will have to take time away from something else in your life to make room for this new activity. You probably will view this as work and you probably could be getting paid pretty well for that work. After a year, you have spent hundreds of hours learning skills you do not want to use and thousands of dollars trying to spend your money on the right products and services to help you. You do not have the money you could have made working instead and you finally have enough of doing it yourself. The problem is your business system is now built on doing it yourself and you can’t easily hire someone or get an ad agency to do it for you. You wonder what a little help from that Jerry Banfield guy would have done in the beginning. He probably could have done some of the hard work and placed everything under your control so that you did not have to hire someone else to help. Maybe it is not too late?
The problem is you don’t know Jerry Banfield but you do know a friend at an ad agency across town. The ad agency starts by grabbing $10,000 to get to know you during a process they call discovery. Next, they grab another $30,000 to make a website for you because they say that there is no way you can have a successful website for less than that. Now that you have invested $40,000 with them, they tell you that you need at least another $50,000 to make sure people see that website. They do a media buy with a company that pays Google to show the ads which lead to a few sales for you. You did not have the chance to test much prior to the media buy and it turns out you should have had a more streamlined conversion process plus had a plan in place to make your ad dollars provide enduring value such as a higher organic ranking in search. You are out $90,000 now with not much to show for it. You spent over a year doing this since every time you spoke with the sales manager at the ad agency, they talked to their manager who talked to their project manager who talked to the person that was responsible for coordinating all of the technical workers on your project that then gave the individual parts of your project out to the office workers. You wonder what it would have cost to hire that Jerry Banfield guy to get your website done for a lower cost, slowly scale your ads up, and place them all under your control. You close your business up since you can’t payback the loan and figure you will start your own online marketing business now since clearly anyone can do it!
So after this eight hour introduction, my rates at the time of making this video are $555.56/hour on oDesk or $250/hour with a prepaid retainer. My rates may be higher now depending on how long you watched this video after May 2014. The oDesk cost is higher because oDesk takes a fee and you pay for only time worked. Thus, if you have a retainer for two hours per week, I will work up to that much each week. If you do not need two hours one week, you can carry over up to 5 hours from a previous week. As you can imagine, everyone so far has chosen to pay me directly rather than work on oDesk. Still, after hiring more than 91 people to work for me on oDesk, I am interested in trying the system myself as a worker.
I hope this has been helpful for you rather you are looking to do your own payment system or are considering having me help you. The remainder of the video is questions and answers for people making their own payment system. If you want to hire me or want to view all of my free resources, please visit jerrybanfield.com. You can schedule a Skype call to get started or submit the contact form to email me.