With the cost of living at a six-year high, households up and down the country are feeling the strain. Despite this problem, many professionals are wary of pushing for better pay, and asking for a pay rise is still considered something of a taboo. Although annual reviews and work appraisals make it simpler for employees to ask for better pay, things aren’t so clear cut for contractors.
Getting the timing right is important when increasing your contractor rates, but you shouldn’t be trying to determine it based on your client’s mood. Here, we take a closer look at when’s the right time to make that all-important rate increase announcement.
Your experience or skills have evolved
Your rate of pay should reflect your experience and skillset as a contractor. If you’ve recently completed a training course, added a service to your repertoire or cemented your experience in a specific market sector, this is a good time to increase your rates. With new skills and increased experience comes enhanced value. Know your worth and don’t be afraid to charge a suitable price for your time and assistance.
You’ve been working for yourself for a while
Time served contractors deserve rate rises too. Over the years you’ve spent in your chosen industry you’re likely to have worked with a plethora of clients across a variety of industry sectors, and picked up plenty of experience in the process. New and existing clients will find the increased experience and knowledge gained through your years of service particularly valuable, so make sure your rates mirror this.
You’ve built an excellent reputation
Whether you’ve worked as a contractor for months, years, or decades, your industry contacts will speak volumes about the service you can offer. There are several reasons why a great reputation matters as described here by ThriveHive:
“People need information in order to form opinions about a business, and they need opinions in order to decide how to relate and interact with it. Having no reputation is just as bad as having a bad reputation. After all, at least businesses with a bad reputation still have a presence. Your business needs a reputation because it puts your business on the map, helps it to stand apart from the competition, and gives people a starting point for engaging with it.”
Companies see value in hiring a reputable contractor to work with them. With a contractor with a good reputation, companies know that quality comes first and the job in hand will be completed to the highest standards. Ensure your rates match your reputation.
Your market is booming
Adjusting your skillset to current market conditions and associated demand is essential for contractors looking to move with the times. If the market you target with your contract services is booming, take advantage of this by extending your current rate.
Beware of upping your rates too frequently
Whilst marking those professional milestones with a well-timed rate negotiation is a must, there is such thing as upping your rates too frequently. There are no firm rules on how often to increase your rate but an annual negotiation or rate rise is the norm for most contractors.