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Pricing Models II; or Why a Per-Word Rate Benefits Freelance Copyeditors


The first post in this series considered the hourly pricing model for freelance copyediting. I examined why it seems fair at first, but why the drawbacks outweigh the benefits.

In this second post I review a second common pricing model for copyediting— namely, the per-word copyediting rate—and why it’s better for freelance editors. Warning: Math ahead!

 Image of hands offering $100 bills

Charging by the Word

Recall the two questions I raised at the end of the “Pricing Models I” post:

  1. Is experienced, efficient editing less valuable than inexperienced, inefficient editing that produces comparable quality?
  2. What if you could get paid more in less time?

1. Is experienced, efficient editing less valuable than inexperienced, inefficient editing?

A per-word rate for copyediting lets us separate money from time in our pricing models.

That’s what an hourly rate says. Consider two editors who charge by the hour. For the sake of comparison, assume the same factors apply to both editors:

  • No cap on the hours
  • Same hourly charge: $30/hour (set by the client)
  • Same 100,000-word book manuscript, with the same needs
  • Same editorial output—that is, both editors produce an edited manuscript of comparable quality

Ted, the New Editor

Ted, a recent graduate, has just hung out his shingle. He is eager to learn and is working hard. But for now he takes a less experienced, less efficient route to achieve high quality.

  • He is a basic user of Microsoft Word.
  • He’s still learning the Chicago Manual of Style.
  • He’s still learning how to query.
  • He does one pass electronically and a second “due-diligence” pass on hard copy (entering changes in the file).

Ted agrees to copyedit the 100,000-word book for $30/hour. He edits at an effective pace of 1,000 words per hour. Ted needs a whopping 100 hours to edit the book. Let’s look at Ted’s invoice:

Ted: (100,000 words ÷ 1,000 words/hour) × $30 per hour = $3,000

Rosita, the Experienced Editor

Rosita has been editing for 10 years. She has developed efficient and experienced processes that result in high quality.

  • She is an advanced Microsoft Word user. She uses wildcard searches and editorial macros to correct common issues so she can focus on the book.
  • She has a finely tuned instinct for where errors tend to lurk, born of years of experience.
  • She knows Chicago Manual of Style inside and out.
  • She uses query shortcuts that save time.
  • She only needs to do one word-for-word editorial pass—electronically.

Rosita agrees to edit that 100,000-word book for $30/hour. She can edit at an effective pace of 2,500 words per hour (or 10 standard pages). Rosita finishes the project in 40 hours. Now let’s look at Rosita’s invoice:

Rosita: (100,000 words ÷ 2,500 words/hour) × $30 per hour = $1,200

Question 1 Analysis

Ted takes 100 hours to edit the same manuscript—with the same level of quality—that Rosita only needs 40 hours to edit. But under the hourly pricing model, Ted gets paid $1,800 more than Rosita. His invoice is more than double Rosita’s invoice.

Hourly pricing models undervalue the experienced, efficient editor. Why should Rosita spend years honing her craft and developing efficient processes—only to be paid less than Ted, the new editor who takes longer and has a lot to learn?

Do you know any other industry that pays the efficient veteran less than the inefficient newcomer for the same quality of work?

“Rosita should charge more per hour,” you might say. And sure, that’s one solution. But show me the university press (for example) that knowingly agrees to pay $40-50/hour for experienced copyediting. That’s a tough sell, no matter how good you are.

That’s why we have to separate money from time in our pricing models.

 Image of watch on top of pile of coins.

2. What if you could get paid more and spend less time?

Ted and Rosita illustrate my second point: with an hourly rate, you will never get paid more to edit more in less time. But with a per-word rate, you can!

Look again at the editing paces of Ted and Rosita. This time both agree to a per-word rate of $.02/word. So both will be paid $2,000 to edit the same 100,000-word manuscript. That seems fair, right? The client expects the freelance editor to deliver a quality edit. The project is worth what the project is worth, regardless of time.

Now look at these editors’ effective hourly rates, or EHRs. The EHR is calculated as follows:

(# of words) × (per-word price) = fee
(# of words) ÷ (words/hour editing pace) = hours
fee ÷ hours = EHR

Ted, the New Editor

Recall that Ted, the new editor, needed 100 hours to edit the manuscript. So here’s how we calculate Ted’s EHR:

100,000 words × $.02/word = $2,000 fee
100,000 words ÷ 1,000 words/hour = 100 hours
$2,000 ÷ 100 hours = $20/hour EHR for Ted

Rosita, the Experienced Editor

But Rosita, the experienced and efficient editor, only needed 40 hours to finish the project. Here’s her EHR:

100,000 words × $.02/word = $2,000 fee
100,000 words ÷ 2,500 words/hour = 40 hours
$2,000 ÷ 40 hours = $50/hour EHR for Rosita

Question 2 Analysis

Now we can see how the word rate becomes a better business practice for a freelancer than a billable hourly rate. The job costs the client the same—but Rosita, the experienced editor, achieves an EHR that is 2.5 times the EHR Ted makes as a new editor.

Let’s Review

Charging a per-word copyediting rate offers at least three benefits for editors:

1. Rosita can work fewer hours than Ted and make the same money. Put another way, she can get paid the same amount to edit the same amount in less time. Then she can use the leftover time on hobbies, with family—or on more work!

2. In the same 100 hours, Rosita can make 2.5 times what Ted makes. Let’s break that down.

  • Finishing the project in 40 hours—vs. Ted’s 100 hours—leaves Rosita with 60 hours to take on other projects at the same per-word rate.
  • In 100 hours, Ted makes $2,000 at an EHR of $20/hour.
  • In 100 hours, Rosita makes $5,000 because her EHR is $50/hour.
  • Rosita’s $5,000 is 2.5 times Ted’s $2,000—earned in the same 100 hours.

3. Rosita makes an EHR worthy of her experience—and Ted has an incentive to find ways to increase his EHR. In charging by the word, we give ourselves an automatic pay raise with every new efficiency we discover, every new tool we invest in, every new style rule we memorize, and every project that expands our experience. And this automatic pay raise never requires us to pitch a fee increase to our regular clients. In the process, we also become better editors—how can we do otherwise?

If you edit faster, with higher quality, and deliver faster, you make yourself indispensable to the client. Shouldn’t you be compensated accordingly?

Come back next week for the third post in this series, which will examine the per-word rate from a different angle: how it benefits clients.

ICYMI! Check out the first post in this series, on hourly pricing models.


 Image of calculator next to piles of coins

Charging by the Word: Summary for Editors

Pros

  • Fairly compensates the experienced, efficient editor by tying payment to expertise, not time.
  • Gives every editor an incentive—an automatic pay raise—to get better at the job.
  • Potentially pays the editor a higher EHR (effective hourly rate) than she or he could charge outright as a billable hourly rate.
  • Enables the editor to make more money in less time.

Cons

  • Requires the editor to collect data over time to determine what per-word rate will achieve a desired EHR (not a con for me, but some editors hate data).
  • Requires the editor to review the entire manuscript up front to calculate an approximate EHR and from that derive a per-word rate.
  • Requires the editor to improve his or her skills to become more efficient and achieve a higher EHR (also not a con for me, but some editors find this daunting).