Pricing your freelance services from scratch

Setting your first freelance price feels like guessing. You have no history, no benchmark, and a fear of quoting too high or too low. Here is a structured approach that removes most of the guesswork.

Step 1: Calculate your floor rate

Your floor rate is the minimum you need to charge to cover costs and live. Start with your annual expenses: rent, bills, food, insurance, software, equipment. Add 30% for tax. Divide by the number of billable days you can realistically work (usually 200-220 per year, not 365).

Step 2: Research market rates

Your floor rate tells you the minimum. Market rates tell you what clients actually pay. Check freelancer communities, rate surveys, and job listings for your skill and experience level.

• r/freelance and r/freelanceuk have regular rate discussion threads
• The IPSE freelancer confidence index publishes average day rates by sector (UK)
• Glassdoor and LinkedIn salary data, adjusted upward by 50-100% for freelance premium
• Ask other freelancers in your network, many are willing to share ranges privately

Step 3: Factor in your value

Cost-plus and market rates give you a range. Value-based pricing pushes you to the top of that range, or above it. The question shifts from "what do I need to earn?" to "what is this work worth to the client?"

A website redesign that increases a client's conversion rate by 2% might be worth tens of thousands in additional revenue. Pricing that project at a flat day rate undersells the impact.

“Stopped charging hourly, started charging per project based on value delivered. Same hours, 60% more income. The shift was entirely mental.”

- r/freelance

Step 4: Set your three tiers

Offer three options for every project: basic, standard, and premium. The basic tier covers the core deliverable. Standard adds extras like faster turnaround or additional revisions. Premium includes strategy, priority support, or ongoing optimisation.

Most clients pick the middle option. By framing it between a stripped-back basic and a high-end premium, you anchor them toward a price that works for both of you.

Common mistakes

• Pricing based on how long it takes you (speed is a skill, not a discount)
• Matching your old salary without accounting for freelance overhead
• Discounting to win the first project (sets the wrong precedent)
• Not reviewing rates annually, costs go up, your rates should too