Over the past several months I have “listened” to discussions of pricing and I have also received numerous applications for employment that include statements of minimum expected fee. What I have noticed about all of these discussions and applications is that there is a wide gap between market valuation and personal valuation.
Just one example from an application: The applicant expected to be paid a minimum of $50 per manuscript page for editing. Just one example from a discussant: The discussant believed her editing was worth not less than $85 an hour.
In neither instance do I think that it is impossible for their services to be worth the price they want. What I do think, however, is that (a) the market will not pay that price and (b) they have not provided sufficient justification for that pricing. BUT, more importantly, they have imposed pride of price rather than viewed the market, determined what the market will bear, and figure out how to convert what the market will bear into what they think their service is worth.
Editors are like most professionals: Because we view ourselves as highly skilled professionals, we value our services at prices we think are commensurate with our skills. All of us do this, myself included. Yet some of us recognize that the market will not and cannot value our services the same.
I have, on occasion, asked these editors how they justify whatever price they have determined their services are worth. I have yet to receive a well-reasoned, carefully mapped out justification. We know that, for example, the grocery store justifies the price of a can of tomatoes on the cost to the store for the can, the store’s overhead attributable to the can, and a percentage for profit, all tempered by what the store’s competition charges. Professionals can’t do this same objective analysis for myriad reasons, none of which do we need to address here. It is enough to say that pricing is an art not a science for the professional.
Yet it is this pride of price that, I think, hinders many colleagues from finding financial success. Too many colleagues set an unrealistic price, based on what the market will bear, and are not flexible enough to work for less — as one colleague, told me, “Why insult myself?”
As you have guessed, my view is different. I, too, think my services are very valuable and were I to place a dollar figure on their value from which I would not deviate, I would rarely work. The market in which I move simply does not value editorial services similarly. Consequently, I have placed greater value on having sufficient work to keep me fully occupied throughout the year. In other words, I would rather have sufficient work for 52 weeks at a rate that pays my bills and generates a profit than to have work for only a few weeks a year at a rate the recognizes the value of my skills.
As we have discussed numerous times before, I accept the market rate and work to figure out how to convert that market rate to an effective hourly rate that exceeds my requirements. (For those unfamiliar with the effective hourly rate concept or who would like to refresh their memory, do a search on AAE for “effective hourly rate” and/or begin with this essay: Business of Editing: What to Charge (Part I).)
I do not let pride of price interfere with business sense.
This always starts a heated discussion about pricing that revolves around these statements: Make your price too low and not only do you not earn a living but you make it harder for everyone else to charge a more realistic price. Never lower your price: Every year raise your price. Never accept less than you are worth.
First, none of these arguments are sound. They are emotional arguments that are not evidence-based. Second, from a business perspective they are not rational arguments, again because they are not evidence-based. Third, they fail to account for each person’s individual circumstances. It makes a difference if your editing income is the sole income that supports a family of six or is “play” money that allows you to supplement your day-job income so that you can take monthly vacations.
But it is the lack of an evidence basis that is the fatal flaw in these arguments. There is no evidence that any of the arguments can withstand scrutiny — or, more importantly, that they are of any intrinsic value.
Louise Harnby wrote a wonderful essay at her blog, The Proofreader’s Parlour, titled: “I’m a newbie proofreader – should I charge a lower fee?” Her article is well-worth reading for the insights it provides. Alas, I think she omitted the essential answer, which is the need to determine what rate is needed to meet one’s financial obligations and to figure out how to meet that needed rate when the market won’t bear it forthrightly. It matters not a whit what colleagues charge; what matters is what you can charge in your market and can you make that rate a profitable rate. I wrote in my comment to Louise’s article: “You could be the greatest editor of all time — the one that dozens of biographies will be written about — but it matters not one whit if you need to earn $100 an hour but can only manage to earn $25. The best starve as readily as the worst.”
The pride of price is a deadly trap. I know editors who are underworked (in the sense that they are not working every day and wish they were) who could be working more except for that pride of price. This is not to say that there is not a minimum price below which one should not go; there is such a price, but that price should be determined not by pride but by hard calculation that there is no way to convert a fee below that price to a rate that meets one’s needs.
As I mentioned earlier, I prefer to work year round. I know what pricing my market will bear and I can accept that pricing because I can convert it to meet my needs. That pricing is less than I think my services are worth, but I look at the broader picture — over the course of a year rather than over the course of a single project. I recognize that on an individual project I may lose money (in the sense that I do meet my needs), but that doesn’t factor into whether I will take on a project (see The Business of Editing: The Rule of Three). My decision is much more influenced by the number of projects I can expect over the course of the year, because experience has taught me that other projects will more than makeup for the losing project.
Pride of price requires one to focus narrowly on each individual project; meeting one’s needed rate allows for the more expansive view.
What do you think?
Richard Adin, An American Editor