Actually, raising prices is more fitting. If the financial crisis raises the cost of running my business, lowering my costs decreases my profit margins. If high prices are already squeezing my wages, lowering my prices will squeeze them even more. Here's an example, the numbers are fictional: Pre-crisis, I make $3,000 every month. It costs me $2,500 to live, giving $500 to save and reinvest in my business. During the crisis, I make $3,000 every month, but now it costs me $3,000 to live. Now I have nothing left over and I'm essentially living paycheck to paycheck. That's not a financially healthy way to live. If I cut my rates, I have to work more to make ends me. Now, if I instead increase my rates and make $3,500 every month keeping my living costs at $3,000, I'm back to my pre-crisis state. That's much better.
What about a third option: spend more time working and taking on jobs so that you won't have to worry about doing either of the first two options? That's what I'm trying to do!
That is one of the options one can look into. There is a slight problem though, as pointed out by Jenn in another thread of mine. Articles are not products so you can't just increase the volume by manufacturing more. We are providing services, and to keep the prices constant, or increase them when our clients are negotiating for a decrease, we need to highlight the kind of value added services they are getting if they stick to us. Doing such a thing has helped me a lot in consolidating my client base
jeewant has it right - you don't need to lower your rates, you don't need to work more hours just to earn the same pay (both could be recipes for burn out), and you don't need to give something away for free (although I recommend doing that during any economic time; so it wouldn't do any harm). You simply need to re-think the value of your work, and how you're marketing it. If your work has value beyond being cheap fluff pieces, get to know what that value is. Is it something still relevant (or even more relevant) during a slowing economy? Or do you need to re-think things and maybe expand or change your service base?
Neither, for mainly the reasons mentioned earlier. Now isn't the time to cut rates or work more hours. It's time to market your products and services, and/or adapt them to current trends. Let's talk about Campbells soup for a minute. Soup has one of the highest profit margins of any food product; meaning that it costs pennies to make a can of soup, but it sells for significantly more than it costs to produce. Now that people and businesses are worried about money, Campbells isn't cutting the price of soup - they're spending more on marketing it. They just launched an ad campaign reminding people how cheap their soup is, and what a good value it is during these 'hard times'. Just my two cents.
Think creatively and try to find ways to do what you do faster and more efficiently and cut out useless jobs/clients that take up too much time for too little pay and find more "fitting" jobs/clients.
Have you started telling your clients that you want to raise your prices? I actually thought of the same thing but I got cold feet. I'm worried that if I increase my rates, my clients will look for someone else
If you need to raise your rates to survive or grow in business, and your current clients won't pay higher rates, that means it's time to look for a new market to target. You shouldn't be with the same exact market forever if you're continually growing and improving.
Neither! In times of financial crisis more people need a second income – and if they turn to the internet they may well need writers – so there should be more job opportunities! Particularly if you can write for markets that are expanding sharply right now. You can choose to look on the bright side or the dark side. I prefer the bright view.
The problem with lowering prices is that everyone would have to do it for it to be effective. If I lower my prices for what I do that just gives me less money to pay my vendors who have no intention of lowering their prices because they need money to pay their vendors.
Again, bsd, you DONT need to lower your money as long as you can find better markets . I once lowered my rates, and got a flood of offers, I took up a few as well. But after a week or so, I realised that I was working more, and earning less than I would normally have done! So, I requested, prompted and warned my existing clients of a 100% rise in my prices. 8 out of 10 stayed, and it was a heartening relief for me
What jeewant said is right,if you are suppling quality stuff than even if you scale up your price your clients will be willing to pay.Rather than doing cheap stuff and doing it for less money , one should do good stuff even if people pay less due to your lack of experience.
In this financial crisis, I beleive in giving a genuine raise in prices to allow enough breathing space for me as well as buyers. If they're in love with your quality services, they'll accept it. As others already suggested, it may be the right time to look for new markets if you're losing your existing clients with this price hike. Just a wild guess; some of the clients may be looking for new providers after quitting their old copywriters (who were more pricey) and who knows that you may get a hold of them (even after your price hike, they may find you cheaper) Good luck to all
I would like to stay calm and will make no changes in prices or my packages. I think price increase will lead to fall in business and low price will lead to stretch of margins.
Interesting question.. im still pondering it.. Its like which came first the Chicken or the egg :| .. Im sure the best way to go about it is to go whichever way you feel comfortable.. a) raise prices, risk losing current work and alienaitng potential customers b). decrease prices but put more pressure on yourself. c). do nothing and stay as you are.. and hope other ppl stay as they are.. everbody hold the fort and hope things get better. hmm interesting Q
I think you should cut back on spending..be frugal..I think you should stick on what makes you successful as a writer..