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The price is right! How do you price your services?

by BlossMart
6 replies
When I started out, I was purposely cheap by the hour - this was something I did as I didnt have the confidence in myself and my service to offer what everyone else what charging this meant I ended up with the following issues:
  • People engaging my services as they were cheap but expecting the earth when it came to deliverables
  • People who didnt really have the money to spend on marketing - which usually ended in me having to chase up payment
  • Me being tired and over worked as I would have to work double the time to make the money I needed to get by

It wasnt a great strategy. After meeting with a business coach, I realised my price point was terrible and I wasnt doing myself any favours. I only was charging this low rate because my confidence was low

If youre starting out or trying to work out what to charge for your services this info might help you out.

Do your research on your competitors
This is so easy to do, either go in cognito or ask around what people doing the same or similar are charing and figure out what the lowest, mean and median price points are per hour and also per service. Work this out in detail and create a spreadsheet.

Ask around business owners to see what they would be happy to pay
This is so simple and yet people rarely do this - do a casual survey and find out what the actual price point for your target market would be. Market research is king, dont forget to do it.

Figure out what you need to earn to cover costs
Sometimes its easy to think, I work from home, I dont need much I dont have many overheads but have you really broken it down to understand what the costs of running your business are. Figure out the hourly rate you need to earn to make ends meet and never, ever go below this.

What is the demand for your service or product?
Is it a short term, seasonal product or service or can you see lit all year? If it is a new and innovative product you could charge premium. Figure out the demand and the lifecycle when you are pricing your product.

Figuring out the optimal price point takes time, if you are a speciality service or have something completely unique this could mean you can charge more

Feel free to add in any other tips that I might have forgotten..
#price #services
  • Profile picture of the author incomecracker
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    • Profile picture of the author Regional Warrior
      Originally Posted by incomecracker View Post

      Thank you for your post you have done a good job..
      Reported sig spammer has been leaving one line answers in threads
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  • Profile picture of the author ashishthakkar
    I wonder if it is right to increase the price based on situation.

    Example I would charge $x amount for website design but charge twice of that amount if I know the person whom I provide services to is coming from money.

    Another example is charge $x to a person who is visiting my website from android but charging more to a person who is using latest ios.
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    • Profile picture of the author BlossMart
      Originally Posted by ashishthakkar View Post

      I wonder if it is right to increase the price based on situation.

      Example I would charge amount for website design but charge twice of that amount if I know the person whom I provide services to is coming from money.

      Another example is charge to a person who is visiting my website from android but charging more to a person who is using latest ios.
      ? really.

      I'm not sure I agree with you there.

      I keep my prices the same across the board, and base it on the work required not the background of the person

      Each to their own I guess.
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  • Profile picture of the author Anek Sartitos
    I only price my services low whenever I am low in funds and need to close a deal right away just to have that grocery money. However, I only do this for projects that don't require creativity or in-depth research.

    However it really doesn't pay to price your services low because the clients you get are not really the ones you would want to keep, or do they care about maintaining a long-term relationship with you--they just want the freelancers with the lowest rate.

    So my solution to this dilemma is to specialize so rate won't be a problem and that there are actually clients looking for intermediate to advance level experts who are willing to pay because they expect to get better results.
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    Anek Sartitos
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    • Profile picture of the author BlossMart
      Originally Posted by Anek Sartitos View Post

      I only price my services low whenever I am low in funds and need to close a deal right away just to have that grocery money. However, I only do this for projects that don't require creativity or in-depth research.

      However it really doesn't pay to price your services low because the clients you get are not really the ones you would want to keep, or do they care about maintaining a long-term relationship with you--they just want the freelancers with the lowest rate.

      So my solution to this dilemma is to specialize so rate won't be a problem and that there are actually clients looking for intermediate to advance level experts who are willing to pay because they expect to get better results.
      Good point, now and again if my pipeline is low I might take on some things I wouldn't ordinarily agree to when times are better.

      And of course when I have done any freelance work, there rate is always negotiated to such a degree that in some cases I don't even want to think about the hourly rate I have worked for.

      I honestly find that having low rates works against me and since I have increased my rate it has made a significant difference in how seriously I am taken and also has increased the quality of my overall work.

      I need less hours so I work better - pricing properly is essential to running my business more efficiently.

      Out of interest how do you decide on your price point?
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  • Profile picture of the author Keith Everett
    That's a good question. I started off doing coaching for new internet marketers on Facebook and charged a relatively low fee, especially if they were friends. This was a big mistake as people tend to view price with value, if you charge low prices, often or not people see you as offering an inferior service. I then bumped the price up quite dramatically, guess what... I go more work, and better quality clients.. just a thought
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