A recent comment on an older post here has sparked this post.
The post related to VAs undercharging their work and a comment was made that it was thought VAs assumed they (the industry this person represented) was making a lot of money and could charge a lot higher.
I want to say VAs don’t work their rates according to what they think the client might pay. They do work their rates according to their own skills and abilities, cost of living and running a business and what is seen as a fair rate in the industry in their particular area.
Yes, I’ve had prospective clients who have called me and wanted to know how much I charge and then say they couldn’t afford me and hang up. I’m really sorry if that’s the case but I can’t change my rates or drop them to try and carry someone else’s business.
I’ve been in business for over 15 years and have had few rate rises in those years but when I have, it’s been important to do so. I provide a range of services from word-processing, to database management, website maintenance, setting up of blogs, even advising clients about social networking tools. I simply cannot afford to charge a very low rate for these services. They take time and often the client is paying for my expertise – not just my time.
The commenter also made reference to retainers and having to pay upfront before any work had been carried out. I see this as a legitimate concern and understand why that can be. Unfortunately many VAs have carried out work for new clients and been left without payment too – it kind of works both ways. There has to be an element of trust that the work will be carried out and the work will be paid for.
On my own part, the only time I’ve worked on retainer is for not-for-profit associations where I’ve been on 12 month contracts and this helped me to know I had a certain income each month during the time I was doing that work. I managed associations for 10 years in my business and really enjoyed the work. However, I’ve never put any of my other clients on retainer and have always invoiced them at the end of each month, expecting payment within 7 days – some clients don’t honour that and although they do pay it does disappoint me that they can’t hold up their end of the bargain and pay me on time if the work is delivered on time. But that’s the nature of business everywhere and does not happen only in the VA industry.
If you’re a prospective client looking for a VA then do your due diligence and place requests with reputable VA networks who provide a form that goes out to their team members. That way you’ll get several responses and won’t have to keep contacting people to find the right VA – they’ll contact you instead. Or if you know others who have VAs they’re happy with, then seek to be referred to them because you know that VA is already ‘proven’.
Chris Jenkins says
The question of price for services is a tricky one, as clients can’t compare “apples with apples”.
I think clients have the expectation that they are hiring a “temp”, and as such they should be paying the same as a “temp” and the scale of services will be similar to hiring a “temp”, i.e. pretty much the same no matter which company you contact.
This is a misconception and you’ve noted the different variances in your blog, and the fact that we are running a business, providing all equipment, software, extra staff to complete work, insurance and the list goes on.
I know for a fact that most of the work I do, can be done by me much quicker than the client and so I need to charge a higher rate to cover my costs, otherwise I would have to work longer hours to make up the shortfall.
I could just add extra time to my cost and that would make up the shortfall, but I refuse to do this. So I end up with a charge per hour that seems quite large when compared with others, because I do work much faster due to experience and expertise, but it is difficult to convince clients that the final cost of having work completed will be the same as someone who charges a lower rate.
I’ve been in business 9 years. I don’t ask for a retainer, but do insist on payment for work when it’s completed, and I will ask for a blank credit card slip or deposit up front to ensure payment will be made. If the client becomes a regular, then I am happy to issue an invoice at the end of the month with 7 day payment terms, but rarely find that these are paid on time.
A long-term colleague who has been in this business much longer than myself, has recently given up and taken on a full time job. Her major complaint was that she spent all her time debt collecting, rather than doing work.
At the end of the day our costs are based on pure mathematics – income minus expenditure = costs.