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How is a Newbie Freelancer Supposed to Fight
Against Waves of Cheap Competition?

See also: Finding Work as a Freelancer

For freelancers, the internet was meant to be the great equalizer that allowed them to compete against larger established businesses in the fight to attract more jobs.

In the beginning, things went well. Opportunities were plentiful and paid well, and more and more people joined the growing ranks of independent contractors. Even people in full-time employment started to find side hustles to augment their income and, by 2017, there were 57.3 million freelance workers in the US alone, and many more in the other major developed economies.

Surfer riding a huge wave

Then, what was once a blessing started to change. The freelance market started to attract more and more competition from overseas laborers, many of whom offered rock-bottom rates that established freelancers couldn't hope to match. Now anyone joining the ranks of freelancers in developed countries will quickly get the idea that the decks are stacked against them.

That doesn't mean, however, that today's freelancers can't find ways to thrive in this challenging market. They just have to adopt the right approach and position themselves for success. Here are some tips on how to do this.

First, Charge What You're Worth

As counterintuitive as it may sound, the first and best way for a freelancer to beat the cheaper competition is to refuse to engage in a race to the bottom. Those that do this are apt to end up in a bidding war they know they can't win.

Instead, it's a better strategy to set a realistic rate that's commensurate with your experience and the quality of work you're capable of producing.

Never underestimate the fact that clients that use freelancers on a regular basis will understand that the rate they pay reflects the results they'll get, and setting an appropriate rate sends the message that they'll be happy with the work you submit. The clients that only care about cutting costs will either accept the reduced quality of the work they get or will ultimately turn to a better freelancer (you) the next time around. Either way, you win.

Winning Your First Client

New freelancers that don't have established clients often find themselves in a nerve-wracking waiting game; they face the choice of giving up for financial reasons or must drop their rates to find work.

In the long run, either approach is a bad idea. Instead, a better approach is to use active measures to find work, including:

  • Build a credible personal website
  • Join industry-related groups and attend their events
  • Execute a networking strategy
  • Focus on writing complete, individualized proposals

That last bit is important because the vast majority of freelancers (and especially the low-priced ones) are taking a quantity-over-quality approach. They aim to submit as many proposals as possible in the hope that one or more are accepted. That makes it possible for a higher-priced freelancer to snatch jobs simply by submitting comprehensive, well-written, thoughtful proposals that make it clear that they have the skills and knowledge to get the job done right.

In a Global Market, Go Local

Another great way for freelancers to win jobs is to focus on selling to businesses close to where they live.

It's a tactic that many don't think to engage in because the borderless nature of the internet makes them forget about the opportunities that may be in their own backyards. By making a concerted effort to market services to local clients, freelancers can turn the tables on overseas competitors with advantages of their own – like the ability to have face-to-face meetings with the client. To get some local work, try:

  • Writing expert advice articles for local publications
  • Getting listed in local business directories
  • Researching local businesses and pitching directly to them
  • Donate services to local causes and charity groups

By pursuing these strategies, a freelancer can build up a client base that won't be as susceptible to poaching by overseas competitors. That way, it becomes easier to hold out for worthwhile projects and resist the urge to compete on price in a losing bid for work.

Encourage Client Feedback and Cultivate Relationships

For freelancers, client feedback is a kind of currency; it demonstrates that they're actively working in the field and gives new clients a reason to extend their trust.

For that reason, it's vital to do whatever it takes to satisfy every new client and encourage them to leave feedback about your work. It's also a great way to encourage dialogue with clients, which is essential to building relationships with them – a factor that's often lacking in an impersonal freelance world.

Building such relationships with clients is an essential part of maintaining a steady flow of work. Also, it can keep clients coming back in the face of competitors that may be charging unreasonably low rates. When there's a real relationship between a freelancer and a client, price is no longer the primary deciding factor. Instead, most clients will see the value in knowing and trusting the person they're working with. At that point, the freelancer isn't charging solely for the work; they're charging for the peace of mind they provide to the client.

Don't Ignore Small-Market Clients

It is an odd irony that a global freelance market that pits workers in low-wage countries against workers in the big developed economies also allows clients in emerging economies to connect with overseas labor – and they hire plenty of workers at higher rates.

They're doing it because hiring workers in bigger markets gives them the kind of location-specific know-how they can't get anywhere else. Even though their labor costs increase, the results more than justify the expense.

For freelancers in the developed world, it pays to not only be aware of this trend but to exploit it to the greatest possible extent. That means remaining open to projects from businesses and organizations in third-world nations, or anywhere else that comes along. Although they may not provide a constant volume of work, they're a market segment that is looking for exactly what big-economy freelancers are selling – and will pay to get it.

Further Reading from Skills You Need

The Skills You Need Guide to Self-Employment and Running Your Own Business

The Skills You Need Guide to Self-Employment and
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The Bottom Line

By following the tips set out here, a new freelancer can still make an excellent living in today's globalized labor market.

It's not necessary to look for ways to underbid the overseas competition, nor is it advisable in any case. Instead, freelancers should charge what they're worth, and work to find and satisfy clients who will return again and again.

Remember, the old adage will always apply – you get what you pay for – so if you do great work the rest will take care of itself.

About the Author

Philip Piletic’s primary focus is a fusion of technology, small business and marketing. He is a writer, marketing consultant and guest author at several authority websites. You can reach him on LinkedIn.