Online Freelancing Proposals and the Bidding Process
Proposals are offers that freelancers use to convince clients to select them for projects: they are the means by which the potential that a project represents is converted into the reality of freelance work. And so, the amount of work you’ll have as a freelancer is to a great degree a function of your ability to write clear, persuasive proposals. Freelancers shouldn’t underestimate how important this is. It’s not enough to be good at what you do—you have to also be good at convincing others that you’re good.
The first three sections of this chapter are designed to help you develop the skills you need to be a good proposal writer. The first provides an overview of the pre-bidding and bidding steps for online freelancing projects. The second provides a high-level overview of proposals, explaining what their objectives are, how clients view them, and what they should contain. The third section gets into the specifics, giving you practical tips for writing proposals that get the job done.
One part of writing proposals is sufficiently complicated that I felt it needed to be explored in detail: pricing your proposal, also known as bidding. Pricing a project too low means potentially leaving some of your income on the table, but bidding it too high could mean leaving all of it behind. Thus, knowing how to intelligently value proposals is one of the most essential skills for any freelancer.
Yet it’s also one of the most difficult abilities to learn and develop.
One reason is that freelancers tend to be secretive about their bidding policies, practices and strategies. Even contractors who are in most respects very happy to provide advice and encouragement to those starting out, sometimes clam up when the topic turns to pricing. They are concerned about giving away important “trade secrets”, and while deciding not to share that information may be regrettable, it’s also understandable.
But even those who would be willing to explain to you how they decide what to bid on a project often find that they cannot do so. Experience has given them an intuitive sense of how to assess a project and client, take into account information that indicates what bids are likely to be successful, and apply pricing strategies to maximize the chance of winning lucrative projects. But they have no idea how to explain what they are doing; often they just end up saying “you’ll figure it out as you go along”.
That really doesn’t help a new freelancer very much, though. So I try to tackle this subject head on in the remaining three sections of this chapter. The fourth section begins with an important contrasting of static and dynamic pricing, the two basic approaches that freelancers can take in deciding how to bid. It then continues to explain a number of important economic principles, which will help you understand the key concepts behind business pricing. The fifth section describes in detail how to determine the value of a project, based on factors of importance to both clients and contractors, and how to use that as the basis for a bid price. And the last section of this chapter explores a number of pricing strategies to help you optimize your bids to ensure success.
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