Four ways to get the day rate you deserve

Increase your day rate with our top tips

Your take home pay is (probably) a big part of your career as a Limited Company contractor, so it’s only natural to consider whether you’re getting the day rate you deserve for your skill set and experience.

 

In this blog we share with you the top four ways to negotiate the day rate you deserve and give you essential advice on how you can continue to steadily increase your take home pay as you progress through your career as a Limited Company contractor.

 

1. If people aren’t buying, then you shouldn’t be selling

Start by taking a look around your industry – who’s looking to hire people in a similar field to you and how much are they willing to pay? What skills are they demanding and if possible, are you able to see how many other people have applied for the same position?

 

Job boards, agencies and talking to similar contractors can give you a great insight into how healthy the hiring market is, at the point at which you decide to aim higher. If a previous client is requesting your services but is questioning your higher rates, ensure you are able to quote reference points throughout your industry research to demonstrate how you can justify your increase.

 

2. Test the waters with an agency

One of the most popular methods used to find contracts is through agencies, so why not speak to them first to see what the marketplace is like? They spend more time looking at day rates and how much clients are willing to pay, so liaise with them first.

 

Ask them if your day rate is on par with those similar to you and whether there are any clients who tend to value the level of contractor’s experience based on the day rate they charge. You could be missing out purely by charging too little!

 

If your agency acts on your behalf they will be able to negotiate with the client that you’re the right contractor for the job, rather than the day rate being right for you as an individual. They can also act as a buffer between you and the client, so should they react in a negative way then your professional working relationship is not directly affected.

 

3. Timing is everything

Are you half way through a contract and realising you’re charging too little? Unfortunately to remain professional there’s very little you can do when it comes to to negotiating a higher rate mid-way through something you’ve already agreed to.

 

However, should your contract’s conditions change or it’s extended, then this is when you’re able to consider introducing a higher daily rate. Any changes in your contract are an open invitation to negotiation on both sides, so use this to your advantage.

 

4. Show passion for what you do

For some clients it’s not just about whether you can complete the contract on time and to specification. Sometimes they’re looking for more and that’s why it’s equally as important to showcase your passions for contracting as well as their industry as a whole.

 

Show the client how much you enjoy contracting, what part of their contract excites you and your enthusiasm for their project. You can’t fake passion and clients knows this, so if you genuinely have a real connection with a certain contract or client then ensure you get this across.

 

It will also make negotiation for a higher rate much easier, as the client will know you’re the specific contractor they want and will be willing to pay.

 

Negotiation is key

So there you have it, our top four tips for getting the day rate you deserve. For many clients, dealing with a contractor that is low maintenance, highly skilled, that can easily form team relationships and understands they are replaceable is a rarity – so use this knowledge to your advantage when pitching for business.

 

Maintain your professional dignity, integrity and reputation and you’ll find it much easier to request an increase in remuneration.

 

Like this type of advice? Our resources section has lots of free blogs and guides, to help you on your way to contracting success. Alternatively you can speak to one of our team of expert advisers. We look forward to joining you on your journey to Limited Company contracting success!

 

This blog has been prepared by Intouch Accounting. While we have made every attempt to ensure that the information contained in this blog has been obtained from reliable sources, Intouch is not responsible for any errors or omissions, or for the results obtained from the use of this information. This blog should not be used as a substitute for consultation with professional accounting advisers. If you have any specific queries, please contact Intouch Accounting.

What are the benefits of becoming a contractor?

Contracting benefits

Often, when people say they are giving up their permanent job to become a contractor, they get a lot of funny looks from colleagues and friends who can’t believe they’d give up a regular salary to go it alone. That being said, there are some definite advantages to being a contractor that can outweigh the security a salaried position provides.

 

Our preferred contractor insurance provider, Kingsbridge Insurance recently blogged about the benefits contractors can expect from their chosen professional field. Here, they share their top 5.

 

1. Flexible working

Although the UK is getting better at flexible working, it’s still not as commonplace as in some of our European neighbourhoods. For many people, the nine-to-five grind doesn’t actually suit. As a contractor, depending on your contract, you decide when and where you work. Remember though, some clients may well prefer you to work from their premises which will usually mean you have to adhere to their office hours.

 

2. Better pay

Generally speaking, due to their specialisms and expertise contractors and freelancers make more per hour or per day than their salaried counterparts. Plus, since contractors are able to claim allowable business expenses when they complete their tax return, they also have a higher rate of take-home pay. This means you can earn more money for less time and it can help to offset the fact that, as a contractor, you won’t get paid holidays, sick pay and other benefits.

 

3. Improved work-life balance

‘Work-life balance’ is a phrase that gets thrown around a lot these days, but that doesn’t mean it’s not important. The flexibility of contract work means that you can do more of the things you love, whether that’s spending time with your children, indulging in a hobby or socialising more with your friends. If you’re happier and more relaxed, you should see your work improving too.

 

4. More career control

As a contractor or freelancer, you can steer your career in whichever direction you want it to go. So if there’s a particular client you don’t want to work with, no one’s making you. If you want to pursue a certain avenue of work, go ahead and explore it, it’s your career to design however you wish!

 

5. Variation

Contracting can have as much (or as little) variation as you like. One of the worst things about permanent employment can be the repetitiveness of going to the office and doing the same tasks day after day. As a contractor, you can ensure that your days are varied either by taking on a range of different clients, or by simply organising your week so that you have different tasks every day. It could even be as simple as working from a different location each day. Whatever works for you, you can make sure you’re never bored.

 

If you’re thinking of making the switch to being a contractor and need expert contractor accounting advice, speak to one of our team here at Intouch Accounting. Or if you’re needing to organise your insurance, contact Kingsbridge Insurance on 01242 808 740.

 

This blog has been prepared by Intouch Accounting. While we have made every attempt to ensure that the information contained in this blog has been obtained from reliable sources, Intouch is not responsible for any errors or omissions, or for the results obtained from the use of this information. This blog should not be used as a substitute for consultation with professional accounting advisers. If you have any specific queries, please contact Intouch Accounting.

Intouch Accounting’s self-employment study

Intouch Accounting’s self-employment study

At Intouch Accounting, we conducted a study into the aspects of self-employment that are causing Britain’s aspiring business owners to question their desire to start up. With possible responses ranging from securing start-up funding to ongoing accounting responsibilities, we wanted to find out why so many would-be entrepreneurs across the UK are binning their business plans.

After being asked the question ‘what puts you off being self-employed?’, 10,000 participants across Britain shared their misgivings when it came to the reality of starting up – and the results are below, segmented by gender, age bracket and location.

 

Source: Intouch Accounting

graph 1

Topline results:

  • Lack of stable income: 47.2%
  • Securing start-up funding: 25.3%
  • Too much responsibility/stress: 24.4%
  • Managing business finances: 16.8%
  • Losing existing job benefits: 15.9%
  • Long working hours: 13.3%
  • Other: 5.1%

 

Males:

  • Lack of stable income: 45.1%
  • Securing start-up funding: 26.0%
  • Too much responsibility/stress: 22.5%
  • Losing existing job benefits: 17.5%
  • Managing business finances: 14.6%
  • Long working hours: 12.5%
  • Other: 6.1%

 

Females:

  • Lack of stable income: 51.0%
  • Securing start-up funding: 27.2%
  • Too much responsibility/stress: 26.2%
  • Managing business finances: 19.2%
  • Losing existing job benefits: 15.6%
  • Long working hours: 13.0%
  • Other: 4.6%

 

18-24s:

  • Lack of stable income: 47.7%
  • Securing start-up funding: 35.1%
  • Too much responsibility/stress: 25.8%
  • Managing business finances: 23.2%
  • Losing existing job benefits: 15.9%
  • Long working hours: 10.6%
  • Other: 5.3%

 

25-34s:

  • Lack of stable income: 51.5%
  • Securing start-up funding: 28.4%
  • Too much responsibility/stress: 25.5%
  • Managing business finances: 20.6%
  • Losing existing job benefits: 17.2%
  • Long working hours: 7.8%
  • Other: 3.4%

 

35-44s:

  • Lack of stable income: 53.8%
  • Too much responsibility/stress: 21.6%
  • Securing start-up funding: 21.1%
  • Managing business finances: 17.0%
  • Losing existing job benefits: 15.8%
  • Long working hours: 13.5%
  • Other: 3.5%

 

45-54s:

  • Lack of stable income: 46.6%
  • Securing start-up funding: 34.5%
  • Too much responsibility/stress: 21.6%
  • Losing existing job benefits: 21.6%
  • Managing business finances: 14.7%
  • Long working hours: 12.9%
  • Other: 6.0%

 

55-64s:

  • Lack of stable income: 39.1%
  • Too much responsibility/stress: 27.6%
  • Long working hours: 27.6%
  • Securing start-up funding: 17.2%
  • Losing existing job benefits: 17.2%
  • Managing business finances: 10.3%
  • Other: 5.7%

 

65+:

  • Lack of stable income: 40.5%
  • Too much responsibility/stress: 27.0%
  • Other: 21.6%
  • Securing start-up funding: 13.5%
  • Long working hours: 8.1%
  • Losing existing job benefits: 8.1%
  • Managing business finances: 5.4%

 

England:

  • Lack of stable income: 51.5%
  • Securing start-up funding: 27.4%
  • Too much responsibility/stress: 24.2%
  • Managing business finances: 17.4%
  • Losing existing job benefits: 16.1%
  • Long working hours: 13.1%
  • Other: 6.3%

 

Scotland:

  • Lack of stable income: 37.4%
  • Too much responsibility/stress: 24.9%
  • Securing start-up funding: 19.8%
  • Losing existing job benefits: 16.5%
  • Managing business finances: 15.4%
  • Long working hours: 13.6%
  • Other: 2.2%

 

Wales:

  • Lack of stable income: 58.8%
  • Managing business finances: 23.5%
  • Securing start-up funding: 23.5%
  • Too much responsibility/stress: 17.6%
  • Long working hours: 5.9%
  • Other: 5.9%
  • Losing existing job benefits: 4.0%

 

Northern Ireland:

  • Lack of stable income: 42.9%
  • Securing start-up funding: 28.6%
  • Too much responsibility/stress: 28.6%
  • Long working hours: 28.6%
  • Managing business finances: 14.3%
  • Losing existing job benefits: 14.3%
  • Other: 14.3%

 

This blog has been prepared by Intouch Accounting. While we have made every attempt to ensure that the information contained in this blog has been obtained from reliable sources, Intouch is not responsible for any errors or omissions, or for the results obtained from the use of this information. This blog should not be used as a substitute for consultation with professional accounting advisers. If you have any specific queries, please contact Intouch Accounting.