Marking up your services

I charge based on the value the client believes the work is going to bring. I get my prospect to calculate themselves how much revenue, conservatively, this project is going to bring in. Then I charge a percentage of that.

Since they created the revenue number, they can't argue with it. I consistently earn more than most people doing the same work in my fields because of this method. Recently, in another post, although I was charging much more than others who listed in there, one person suggested that I should even be charging more! But I don't think people understand the difference between revenue (sales dollars) and profit (what you keep after your costs of earning that revenue are paid). I base my price off of the prospect's projected profit, which after all truly is where you're getting paid from. Then they can decide whether or not to move forward.

So I decide on a case-by-case basis. Then I know each project is profitable, because compared to an hourly rate that I'd be comfortable renting my brain out for, the real pay for me is much higher.

Here is how I figure out what to charge for any services I do.

Number of hours it will take(125% flub factor if I am not sure)
X
Hourly rate I feel I am worth.($20 to $100 gives you a good idea)
+
Any outsourcing not figured into the hours above(this you may decide to charge at a lower hourly rate or just include it above. Bare minimum double what the outsourcing will cost you.)
+
Any other costs(normally double these as well)
=
Amount I would charge

This formula is fair. It allows you to within mins of figuring up a project to be able to make a real quote on it.

Certain things like simple fan pages you should just have a set rate you can quote. Remember the guys who need a better fan page are upsold into it. "I could do a basic fan page for $300 as I told you. Or based on what you would like I believe I could put together all that for $1,000. Which way would you like to proceed?"

That way the customer sees he is getting more vs. what you provide for $300 but he always has the option to simply take the basic(save face for budget reasons). This is a classic sales technique used in large item sales. Never make them choose between the high price and nothing. There should always be a choice with less features that allows them an out vs. the item that fits all their needs. To make it really fun price out 3 options with an extra above and beyond what they wanted. This way it leaves you an upsell.

EDIT:
Also remember when figuring up your hourly rate that you have to mentally take taxes out of it including 15% minimum for SS and Medicare(self employment tax). So your hourly rate must be higher than what you would get paid at a "job".

What is your monthly income goal, and what do you normally charge your clients?

Basing it on the client may be the optimal way to go, i.e. charging based on the value it brings to the client.

Getting one new customer for a client who sells parts in the Aerospace industry is worth more to them (and hence a higher fee) than getting one new customer for a client who has a hot dog stand.