While there are people who seem to believe that when it comes to prices quoted on freelance sites, they should be independent of any statutes or limitations as posed by the sites themselves, I refuse to toe that line at all.
After all, most freelance sites work on a percentage commission fee basis, apart from membership fees which they take from freelancers. Clearly when they do so, it is in their own interest to ensure that prices remain as high as possible so that they in turn can earn higher commissions.
As an instance, Elance charges a flat 8.75% commission on every single payment which is made by clients to contractors, irrespective of the amount which is paid out. So if say I have a $100 project which involved writing 10 500-word articles at $10 a piece, Elance would earn $8.75 out of that $100 which the client pays me to eventually hand me $91.25. In the same situation if I were to work at $20 an article or $200 for the exact same project, Elance would earn $17.50 without doing anything extra or different.
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| Elance charges 8.75% commission on every dollar which is earned by freelancers on the site. Therefore, it is in their own interest to ensure that every project maximizes revenue for them, which can only happen when they themselves work on stipulating higher minimum payouts for each project. |
So who's the loser working at low rates, besides the freelancer in question of course? Yes, the freelance site too!
And if you ask me, this whole argument that large volumes of work can easily make up for small payouts on each project simply does not cut any ice whatsoever with me. After all, time and effort required on all such small projects is often similar to the larger projects, sometimes even greater, since freelancers are willing to work at really low rates. In such a scenario, the freelance sites lose out as well since they have to put in greater administrative and operational effort (and of course costs) towards small returns per project.
Instead if they mandated higher prices - or worked on a model which at least encouraged higher prices very strongly, I am sure the freelance sites themselves would have so much to gain from maintaining such a setup.
These are thoughts which I shared in a video on my YouTube Channel on Freelancing - Vikram Luvs 2 Freelance, where I have emphatically stressed on the need for freelance sites themselves to have higher prices being quoted on them, which can ultimately very clearly work in their own favor:
Please feel free to share your thoughts on this matter in the comments section below - I always love to hear from my readers!
