Why would this happen and am I just getting more efficient? I would hope that my efficiency continues to increase, and maybe it plays a part. But, I believe there’s more to this story.
First, as I’ve secured projects with longer timeframes and bigger budgets, I’ve been able to eliminate the small, one-off projects that invariably become a drain on my profit margin, creativity and work schedule. Rate increases act as a very effective tool to weed out potential clients and projects that aren’t a good fit for you or your business. By “good fit” I mean the clients who want something for nothing, or promise some amazing payday if you just cut them a deal “just this once.” With a healthy mix of profitable clients, your business is in a stronger position to pursue and accept projects that are a good fit, and decline those projects that could ultimately hurt your bottom line.
Eliminating the time-suck projects opens your schedule for more profitable work. Rush jobs and micro-projects rarely go smoothly. Client communication and creative execution always take longer than expected and these short projects can take a big hit on your productivity.
Second, larger projects take longer to complete. Sounds obvious, right? But, here’s the important thing to remember. You can use this to your advantage if you’re smart about invoicing and project management. Instead of sending two or three invoices at milestones, invoice every two weeks or once a month. It helps your bank account and keeps motivation up on both sides. A longer timeframe provides more opportunity to collect checks, hone your customer service skills and fine-tune your creative output. Project management is a crucial component of large projects, so get it right and stay organized.
Larger projects have enabled me to more effectively plan my time. Structuring weekly work schedules around 4-5 projects allows more time for personal projects and life outside of business. Cutting out the unproductive rush jobs and micro-projects has actually allowed me to work less per week while increasing revenue.
By charging more I have effectively gained more control over how my time is spent and increased my per-hour profit margin.