Easy Pricing Strategies To Determine Your Rates
It might just be the most stressful decision you ever have to make: what to charge?
You’ve got the competition to consider, or maybe not. If you are very credible and have enough evidence of that in the form of repeat business, charge what you know you are worth or another way to do this is charge the value of what you are delivering to the client. Write down all the things you do for your clients and what value that adds to their life and business and then put a number to that value.
Other aspects to consider are your own skill set, what you perceive to be your skills (yes, this is different from the former for most of us), what your market will pay, your location, and a host of other variables. Working it out can feel like a hurdle you can’t quite get past, but the more informed you become, your answer starts jumping out at you.
But what about all those other questions? Creating a solid pricing structure requires you to do a little more digging. So with your starting number in line, take a look at:
Your Competition. This might take a little detective work, since a lot of service providers don’t publish rates. But if you pay attention to their websites and social media, ask a few discreet questions, and get on their mailing list, you can figure it out.
Be realistic about who, exactly, your competition is, though. Don’t undervalue or over-sell yourself. In other words, make sure you’re comparing yourself to another provider who shares the same skills, market, and track record, rather than simply looking at who you strive to become.
Your Skills. In some fields, this is easy. There are certifications and educational programs that allow you—by virtue of having achieved them—to charge a certain rate. If you’ve followed this path, then pricing will be easy for you. If not, take a solid look at what you can legitimately claim as a skill.
Look, too, at your track record. Have you proven yourself by helping former clients (and do you have the testimonials and case studies to show for it)? Have your former clients moved on to bigger and better things after working with you? (That’s a good thing!) These are all reasons to maybe consider a higher price range than you might have first thought.
Your Market. In the game of setting rates, they say that it’s your market that has the final say. As any first year economy student can tell you, the price of anything lies where what the buyer is willing to pay meets what the seller is willing to accept, BUT if you can introduce the market to something they do not even know that they want or need you may just be able to bypass this ‘ law’ because no-one can put a price on what does not yet exist. Just think of some companies who have done this such as Apple for one.
If your goal is to give newbies a helping hand and lead them down the path to success, that unfortunately means you can look forward to low paying gigs. That’s not a bad thing—everyone has to begin somewhere—but it can be a long and hard road to go down this path. If, on the other hand, you’re target market is more established and economically stable, then a higher fee isn’t just warranted—it’s a must. They will expect a higher price, and will not find value in the lowest-cost provider of anything, whether it’s coffee beans or business coaching.
Finally, don’t forget that pricing is never set in stone. It’s flexible. If you find you’re attracting the wrong market (or no market at all) you can always change your rates. Working too hard for not enough return? Raise your rates.
There is a lot, lot more to pricing, but this may be a good starting place and remember, it’s your business. You get to call the shots.