Before we can sell out your services, you need to know what services you are offering. Now is a good time to get out your notebook or open up a new Google Doc and start brainstorming all of the services or packages you want to offer.
I created a document called “Design Pricing” and compiled the pricing I wanted to use for packages of design hours. For example, my design clients can purchase a package of 5, 10, or 15 design hours per month so my document includes the cost for each of those packages. For my branding and web packages, I put together a list of what I wanted to include in each package to make it a no-hesitation offer for the price point. Then the pricing is based on the amount of hours that will go into it and how many clients I want to take on per month.
Take some time to think about how you want to be working with your clients, and what options you could include in your packages. If you are a social media manager, your monthly package may include a set number of posts per month, per platform.
SOME THINGS TO CONSIDER:
- What services do you ENJOY doing?
- What services are you really good at?
- How much can you get done in an hour?
- Is there anything you want to learn to do to add to your services later?
How to Determine Your Pricing
How I determine my pricing is to sit down and figure out how much money I need/want to make each month. We will go with the example of wanting to earn $5,000 per month BEFORE any taxes or expenses (as those will vary from business to business).
Now, how many hours do you want to work per month or for how many clients? If you want to earn $5,000 and only want to work with a maximum of 5 clients – you need to be charging at least $1,000 per client. So your base package should start at $1,000. You can of course create EXTRA Packages above and beyond this amount – many people chose to have tiered packages with different price points. This is just the BASE PRICE you need to be charging each client/per hour to make your goal earnings.
If you want to go by hourly and you only want to work 25 hours per week (x 4 weeks in a month) for a total of 100 hours per month. $5,000 divided by 100 hours in a month means that your base rate should be $50 an hour.
The number you set as your goal will be different for everyone, and change based on your location, expenses, etc. Be sure to do your research on what your tax implications should be and estimate what expenses you’ll need for your business – a client management system like Dubsado, computer software subscriptions, web hosting, and all the other expenses for your website, etc.
You can absolutely start your business with very little overhead – I started out by sending all of my invoices manually, for free with http://www.invoice-generator.com and use Paypal or E-Transfers (for Canadian clients) which have very low fees and no need for a client management system like Dubsado. However, as you gain more clients these services can make your workload easier – and it’s much easier to set them up from the start than to be creating an entirely new system four clients in.
Once you know your tax amounts, expenses, etc. you can add on that amount to your package, divided by your number of clients. Let’s say you want 5 clients and your additional taxes and expenses are $500 per month – you can add a cost of $100 to each package to accommodate this, so your base package pricing is now $1,100.
