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Pricing Models III; or Why a Per-Word Rate Benefits Clients

My “Pricing Models II” post last week looked at why a per-word rate benefits freelance copyeditors. A robust discussion ensued in one Facebook editing group, with a frequent question being this:

“That’s great, but how do I convince clients to pay by the word?”

To be effective at the business side of freelancing, we must work to understand our clients’ needs. My freelance business benefits from my experience as an in-house managing editor who spent 11 years hiring and managing freelance editors and translators.

As a client, I paid my editors by the hour. But my translators insisted on being paid by the word.

Guess what? As a client, I discovered that paying by the word benefits me enormously.

In this post, I put my client hat back on to examine why a per-word rate is good for clients. Read to the end for talking points you can use to convert your own clients to a per-word rate.

Revisiting Ted and Rosita

Recall Ted and Rosita from my previous post (read the whole thing for the full scoop). In these scenarios, the hypothetical publisher client is paying $.02 per word for copyediting, no matter how long it takes Ted or Rosita.

  • Ted and Rosita agree to edit the same 100,000-word book for $.02 per word—for a total of $2,000.
  • Ted edits at a pace of 1,000 words per hour. It takes him 100 hours to edit the book. His effective hourly rate (EHR) is $20/hour.
  • Rosita edits at a pace of 2,500 words per hour. It takes her 40 hours to edit the book. Her EHR is $50/hour.

Good luck getting a publisher client to pay $50 an hour! But if you can persuade the client to pay between $.02 and $.04 per word, you can make more per hour than some clients would pay outright.

A Process Note for Freelancers

Whether your client dictates a per-word rate or asks you to suggest one, you do want to see the full manuscript up front—or as much of it as the client can send you. This allows you to evaluate the job by doing a sample edit (for yourself, tracking your time), skimming the rest, and then crunching numbers to arrive at a per-word rate that should get you to your desired EHR.

But if I’m your client, do I need to know your target EHR? Not at all.

Should you tell me how long it took you to edit my project? Nope.

These figures are none of my business. From now on, you have a new policy: “Information about time tracking is proprietary.”

How a Per-Word Rate Benefits Clients

Understanding the client’s needs can help you convert clients from a per-hour to a per-word pricing structure for copyediting.

It helps to realize, first, that clients have no particularly strong basis for paying by the hour. A client might suggest an hourly rate for a few reasons:

Budget and schedule are good entry points to persuade a client to pay by the word.
  • The client feels like it’s only natural to pay an editor like a plumber or lawyer—that is, by the hour.
  • The client hears that other clients pay by the hour. The idea becomes self-perpetuating.
  • The client isn’t sure how a per-word rate works. Does it apply to the original word count or the edited word count? (Hint: The original word count!)
  • The price-shopping client hopes to pay less by offering an hourly rate to an experienced editor who works efficiently.

Everyone has a budget. Everyone has a schedule. Budget and schedule are good entry points to persuade a client to pay by the word.

That brings us to four key ways a per-word rate benefits clients.

1. A per-word rate means that the same manuscript costs the client the same amount for the same editing quality—no matter who edits it. A per-word rate uses the word count of the original file, not the edited file. So as the client, I’m enticed by a per-word rate. I don’t risk paying a less efficient editor more money to take more hours to edit my project. (Remember your new policy: “Information about time tracking is proprietary.”)

2. A per-word rate allows the client to budget up front for copyediting. As a client, I hate surprises on invoices. I hate paying more for lower quality, too many hours, or longer turnarounds. I might even be reprimanded if my freelancers consistently, unexpectedly go over budget.

So as a client, I like knowing what a project will cost me before it begins.

If I know the per-word rate and the original word count, I know how much to budget. And as long as you, my editor, deliver quickly with high quality, I don’t care how many (or few) hours you spent on my project. (Again: “Information about time tracking is proprietary.”)

3. A per-word rate allows a client to reward a freelance editor for a fast turnaround—because the faster the editor works, the higher his or her EHR will be. If I’m a client with a tight deadline, I appreciate fast turnarounds from high-quality freelancers. A good per-word rate lets me reward a fast turnaround.

  Meme courtesy of Amy Schneider, of    Featherschneider Editorial Services   .

Meme courtesy of Amy Schneider, of Featherschneider Editorial Services.

Let’s go back to Ted and Rosita. Rosita takes less than half the time (40 hours) Ted needs (100 hours) to edit the same project to the same standard. If Rosita and Ted both put in 40 hours of editorial time each week, Rosita will deliver the edited project at the end of week 1. Ted won’t deliver that project until the middle of week 3.

Why does it matter? Look at this from the perspective of the publisher client. Production teams often must make up time from delays during the writing, acquisitions, and development stages. Rosita’s efficiency and experience make her indispensable to the managing editor tasked with getting a project back on track and on schedule.

When a busy client finds you indispensable as a freelancer, they begin to come straight to you instead of shopping around for the lowest rate.

4. A per-word rate builds accountability and transparency into the client/editor relationship. As a client paying by the hour, I never really knew whether a freelance editor’s billed hours included Facebook and coffee breaks. I had to trust that my editor wasn’t padding the hours total.

To be clear, I never assumed malice on the part of my freelancers. But I’m an editor myself. I know that even conscientious freelancers forget to turn off their timers, wind up in the weeds while checking facts, or wonder how to charge for hours spent learning the client’s style manual.

That said, if I pay a per-word rate based on the original word count—a number I already know, as the client—I don’t care how my editor spends his or her time. I do care that the edited work meets (or exceeds!) my expectations. I do care that it arrives on (or before!) schedule.

And if you’re my freelancer, and you make my life easier, I'm probably coming back to you with more work. And I’m likely to continue paying you a reasonable per-word rate, because it’s in my interests to keep you happy.

Let’s Review

Use these talking points the next time you want to pitch a per-word rate to a client!

  • “I charge (or will accept) X cents per word. I use the word count of the original file you send me.”
  • “A per-word rate benefits you, the client, because you know exactly how much the project will cost up front.”
  • “You benefit because your cost doesn’t hinge on my editing pace. Whether I have a fast day or a slow day, you pay the same.”
  • “You benefit because a per-word rate gives me an incentive to work efficiently, which means I can deliver sooner.”
  • “A per-word rate builds accountability and transparency into our working relationship.”

Come back next week for the fourth post in the series, where we’ll get into advanced pricing: namely, project fees (or flat fees). We’ll look at how to calculate them and why they benefit both freelancers and clients.


Charging by the Word: Summary for Clients

Pros

  • Can offer a per-word rate that is reasonable in the marketplace.
  • Can budget up front, with no surprises, because price is now based on the original draft’s word count—not on time spent.
  • Eliminates the risk of receiving an astronomically high invoice from a less experienced, less efficient editor.
  • Rewards editors for fast turnarounds—a per-word rate gives the editor an incentive to work efficiently.
  • Attracts experienced, efficient editors who are delighted to work with the client on mutually satisfactory terms.

Cons

  • Makes it more likely that a prospective freelancer will ask to see the entire manuscript up front to determine a feasible per-word rate. (Not strictly a con, but this may pose an obstacle for clients who want to line up an editor while they’re still writing.)
  • Might pay a higher total fee by the word vs. by the hour, if the editor is efficient and experienced.