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We’ve discussed the pros of latching your own service business last time.
Now let’s look at the pricing strategies that you may want to use.
First of all, you have to accept the idea that in this kind of business YOU are the PRODUCT. Or something that you are good at.
Say it to yourself and try to be realistic when defining the price for your services.
Here are 3 possible strategies for setting the price:
1. Hourly rate
The simpliest way to set a price is by hour. It is easy to understand for customers and easy to control for you. Most people are getting paid by hour as well as most freelances. Choose this pricing strategy when timing is essential for a customer.
However, this method limits your potential income as there are only 24 hours a day. So, find a way to also utilize other pricing strategies if possible.
2. Package service
That means that for a flat fee you are ready to do a task or a combination of tasks regardless of how much time they will take.
For instance, “writing an article” for 150$ is a package. But “writing an article, searching for the keywords, posting it on WordPress for 400$” is a more valuable package.
This type means you offer a package with a certain amount of hours available for the customers. A classic example would be a language school providing you an access to tutors for 100 hours. You can invent your own variation here.
How much should I charge?
STEP 1: Start with:
a) Calculating your costs
b) Adding desired profit
Do not forget such factors as:
- the cost of the software
- marketing tools
- cost of your home office
STEP 2: Check out the competitors
Do not compare yourself to those having a different (esp. lower) level of experience or expertise. Value yourself!
The best thing you could do is to create a website telling a story of yourself (your business). Then you will have something to market and to work with.