| Let me try and spin the "raise your rates" advice in a different way - since it's a piece of advice I give pretty often too. It's not necessarily due to undercharging that I advise folk to "raise your rates" - it's because it's a fantastic client discovery mechanism. You want clients who pay more. The clients who pay more tend to get more value from your work. So at any point the clients you have that are willing to pay more are generally better clients (for you and for them). So if you raise your rates and only support those clients you get a set of better clients who are going to be happier with your work, and give you more money. Those clients, in turn, allow you to find similar good clients. Through recommendation and marketing for those clients. So you grow your set of good clients. You'll then find a subset of those will be willing to pay more - because you provide more value for them. Repeat. You will find that some of the work you do changes radically - at least in the way you sell it - during this period. Raising rates isn't (just) about extracting the most money from your clients as possible. It's a way to help you find the clients who you will serve best - and because of that they're more than happy to pay you more. To answer your end questions (and this is a little bit unfair since this is the second time I've started my own consultancy so have probably moved through the levels a bit faster this time - and I have a very strong idea of where my value-niche is). If normal hourly is $x to $y - then I very deliberately started at $y just under 2.5 year ago (I very much do not want the clients who want the cheapest possible solution - learned that lesson ten years back ;-). Currently my effective hourly rate (I don't actually charge by the hour any more so clients never see that number) is about what my day rate was when I started - so about 1:8, 1:9... something like that. Looking back with 20:20 hindsight I could have made that transition quicker if I'd been braver. After a conversation a little while back I have discovered there are people doing similar stuff to what I'm doing with a slightly different kind of client for about five times what I'm charging. This is being actively addressed ;-) |