Thursday, October 27, 2011

6 Questions To Ask Yourself Before Working For Free

What should you do if someone requests your services for free?  I recently followed a heated debate in the Resume Writers and Career Coaches LinkedIn group, where a majority of the 30 respondents thought it depended on the person asking.  What I’ve surmised from this discussion is that it’s best to set a policy about free services early on to spare yourself some strained relationships. 

© Hajime Nakano
There are two things to consider here: discounts and pro-bono work.  A flat discount for friends and family is one way small businesses address the issue.  If you are unsure about this, then use a decision-making framework to evaluate the risks and benefits of accepting or not accepting pro-bono work on a case-by-case basis.  Ask yourself the following questions: 

1.  How much can this person afford?
There may be people who simply can’t afford your services, but could really benefit from them.  They may be turning to you as a last resort and will most likely be really appreciative of your help.  Others are just looking for a deal or price break.  Those who truly understand how much of your time and effort will go into your “free” services, will gladly pay you what your services are worth.   

2.  How well do you know each other?
Are you really friends or merely acquaintances?  It seems like everyone is looking to save a buck anywhere they can.  We’re living in a world fueled by discounts where we’ve been trained that “it doesn’t hurt to ask.”  Keep in mind that there are risks to discounting your services.  Firstly, discounts may become an expectation by the person who has received it.  If you don’t offer the discount the next time, they may walk away wondering what they’ve done to offend you, feel hurt, and/or not return for future business.  Secondly, they may refer others to you by saying “they’re so cheap!”; consequently, promoting your business at fees that aren’t sustainable and not in line with product/service quality.  Lastly, once you do it for one friend or family member, how can you deny another?  How would others feel if they found out they didn’t receive a discount but someone else did? 

It’s best practice to share your regular rates with everyone before you decide to discount.   It’s even better practice to charge your regular rates to everyone, but provide exceptional value to your family and friends by putting in some extra effort on their projects or adding in something special.  If you choose to discount, don’t discount your rate, rather charge less hours to get the appropriate revenue.  That way you will never negotiate rate and you’ll appear very efficient at product delivery.

3.  Do I have the time?
Your time is precious.  Reality is that you can always make more money, but you can’t make more time.  Although offering products for free eats away at your bottom line, offering your services for free eats away at your free time, time that you may normally spend with your family, friends, or other priorities.  If you decide to provide free services during working hours it takes away from your availability to make an income.  Although some may get great joy from volunteering for worthy causes, it will not provide for the people who are counting on them for daily survival or cover their overhead business costs.  Some consultants work this out by setting aside a certain number of hours for volunteer work each month.  When your services are requested for free, consider how much time you have left in your schedule for pro-bono work. If you’ve used up all your time this month you can refer them to another professional with some availability, or tell them the realistic timeline of when you could get it done. 

4.  Do I owe them one?
We’ve all been there; helping a friend move or assisting them with some other daunting task, leaving you feeling that they “owe you one.”  Bartering or trading products/services with others is a great way for both individuals to get what they’re looking for.  It doesn’t have to be business-related, it could be much simpler like housesitting while you’re on vacation, babysitting, or dinner.  Go with your instincts; if you feel like you are both getting a good deal, then go with it.  If you feel you’re being taken advantage of then the deal is not worth the resentment that could eat away at your relationship.

5.  Do I really want this project?
Whenever a project is requested, you do have the right to decline it - especially if it is something you wouldn’t particularly enjoy doing or one that may give you a great big headache!  In that case, it may be best to respectfully decline the project and refer to another professional that may be better suited.

6.  Will this lead to other business?
Let’s face it, not all remuneration is monetary.  Many volunteer projects lead to amazing career opportunities.  When considering a project think about the extra benefits such as a great recommendation from a respected individual, referrals for new paying clients/customers, experience in a new area, an “I owe you”, etc.

When you receive a request to provide free services, your initial response could be something like, “I’ll have to take a look at my schedule and let you know if I have room for pro-bono work right now.” This gives you an opportunity to think about the implications of accepting the work or not and/or whether to offer a discount.

If you’re sure this project isn’t for you, Leslie Ayres of the Resume Writers and Career Coaches LinkedIn Group suggests, “I wish I could but my schedule is too busy to let me take on any more pro bono work right now, sorry!”  It would be helpful to then give them the number of another trusted professional.  Another response could be, “I wish I could, but considering my overhead business costs I am unable to do this for free.  I can gladly extend you my ‘friends and family discount’.” 

How do you feel about this topic?  What do you charge (or would you charge) your family and friends for your consulting services?  What other questions should be added to this framework?

Miranda Vande Kuyt is a self-employed project and communications consultant. She is the facilitator of the “Look Before You Leap: Self-Employment Survival Strategies”