Negotiating for Freelance Success Series (part 3 of 3): To be a great negotiator you must master the TLC Factors™: trust, leverage, creativity.
To be a great negotiator you must master the TLC Factors™: trust, leverage, creativity.
A fellow freelance writer pinged me recently to help her prepare for a call with a potential client. She was excited and nervous. It was going to be the biggest project of her career, a multipart technical report for an accounting firm. It sounded like a bear of a project and a boatload of work (to mix my metaphors).
“How much will you quote for this work?” I asked.
“I don’t know,” Paula (not her real name) responded. “I was hoping to maybe get five thousand…”
“I’m thinking more like 15,” I said, then heard a gasp on the other end of the line.
“I can’t ask for that much! They’ll think I’m insane!”
I shook my head vehemently, as if Paula could see my disagreement over the phone.
“Let’s review the TLC Factors on this engagement so you can feel confident that you deserve this much money and that the client will see the value in working with you,” I suggested.
The TLC Factors™ is the phrase I use to remind myself and my coaching clients about the importance of trust, leverage, and creativity in negotiation.
In Paula’s case, the TLC Factors™ all lined up in her favor:
Building Trust in A Negotiation
Paula was recommended for this gig by a person who used to work as a marketing director for a big accounting firm, and the recommendation was based on direct experience working with her. That’s the gold standard of recommendations! It generates immediate trust, which means that Paula is coming into the negotiation with a huge advantage.
Paula also has a professional-looking website with some testimonials. In addition, she is responsive and her email correspondence is friendly but professional. All these little things add up to yet another level of comfort for the potential client.
During the negotiation, Paula can increase the trust factor even more because she can discuss her prior experience working with accounting firms and she can proactively offer some valuable suggestions about making the current report more reader-friendly and interesting. Both will showcase her expertise and enhance the potential client’s trust not only in her abilities but in how easy it would be to work with her.
Trust also translates into a cost calculation for the client. The Chief Marketing Officer (CMO) knows that by engaging Paula, they likely won’t need to go through many revisions (saving the billable time of the accountants for whom Paula would be writing).
Using Leverage in A Negotiation
Before a negotiation, think about the ways in which you can leverage certain aspects of the project to your advantage. What is the timeline? Is the client still interviewing other candidates? Do they have external factors/deadlines driving the project forward?
These are all little points of power that can be shifted in your direction when negotiating with the client.
Through her preliminary correspondence with the CMO of the accounting firm, Paula knows that this is a rush project. The CMO also let slip that they’re not looking at any other candidates because they have no time. So it’s Paula or bust. There’s a slightly panicky edge to the CMO’s missives.
Leverage may sound like a mild form of extortion, but consider it from Paula’s perspective. It’s a big job and it will likely stretch beyond the original deadline (Paula knows from experience that large accounting firms can be inefficient and projects can stretch if the deadline is not one set by a client or the government). Therefore, Paula won’t be able to take on any other jobs for a significant period of time. Her opportunity cost corresponds with her leverage, and should drive up her fee accordingly.
Think Creativity During A Negotiation
Because of the size of this project and the client involved, Paula has an opportunity to be creative with the fee arrangements for the project.
If Paula is uncomfortable making a direct $15,000 ask, she can offer different ways to get to the same figure. For example, she can give a set price for the parts of the project that are well-defined right now and an hourly rate for the parts that are fluid.
She can break down the project by deliverables and bill when each deliverable is completed.
Or it may be worth offering a small discount if the client is willing to pay the full fee up front.
By thinking about different possibilities, Paula is reducing the chances that the conversation with the client will ever turn into a take-it-or-leave-it standoff and increasing the chances that both parties will feel great about working together.
I’m happy to report that Paula realized the value of her services and quoted $15,000 as her fee for the well-defined parts of the project and a hefty hourly rate for any additional scope. All told, her final fee ended up being significantly above $15,000. Beyond the difference that this experience has made to her bank account, it also brought Paula a new level of confidence in her marketability.
Now let’s talk about you. Think about a recent negotiation with a potential client. Do you think that you’ve maximized your TLC Factors™ in that conversation? If not, what could you have done differently?
Like most skills, negotiation takes practice.
You can read and think about how you might negotiate, but until you actually do some role playing it is difficult to apply those skills.
You don’t want to get caught in the moment while on the phone with a new client and find yourself stumbling over words or feeling uneasy about the project quote that you are about to give. Walking through different scenarios ahead of time will ease your mind, give you confidence, and lessen the nervousness that comes with negotiating.
Powerful Ways to Become Comfortable with Negotiation
Review past negotiations to identify the pivot points at which the TLC Factors™ could have made a difference. If you can’t identify any pivot points, think about where you could have injected information relevant to the TLC Factors™ into the conversation.
Play-acting negotiations before they happen is how professional negotiators both learn their craft and prepare for upcoming negotiations. Enlist a fellow freelancer and simulate a negotiation - you’ll be amazed at how confident you’ll feel the next time you’ll have to negotiate for real.
If you haven’t done so already, download this very useful checklist for negotiation prep. It’s a negotiation game changer!