How do you determine pricing for a client?

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Permalink Reply by Jeannine Clontz on November 16, 2008 at 8:54am

Hi, Nikki -

The biggest thing with price is to make sure that you're charging enough to cover not only your needed income, but your expeneses and marketing costs. If you price yourself at a price point that doesn't allow you to survive, you won't be able to stay in business which doesn't help you or the client who will then be left having to find someone else.

In your particular situation, you may find it beneficial to put together some 'packages' that allow clients to choose the program that fits their needs best. I would contact your current clients, maybe do a survey of some sort, and find out what might be most helpful to them, since they're the ones using this type of service now. They will also be able to help you discern what types of problems you are solving for them - these will be great content for your marketing to potential clients.

Your pricing is very low for someone looking to support a full-time business, and no matter what, you need to NOT compare yourself to overseas options. None of us can compete with someone in another country that doesn't have to deal with the same cost of living as we do. There's plenty of business out there, and not all of it will be the right fit for you. If someone is looking for someone who charges $3-5 an hour, you will not be a good fit for them. You can't stay afloat trying to compete against that market.

You want people who want to do business with you because you offer them the best quality service at a reasonable rate because you are the expert. So focus your time on gaining all the knowledge about your niche as possible. Ask your current clients for referrals, and consistently keep in touch with them to build a good long-term relationship.

Price is probably the hardest thing for people to grasp. It needs to be the best for you and the client. Look for others in your niche and find out what the market will bear so you have a good range to consider. Don't sell yourself or your talents short. You deserve to be paid what you're worth.

Hope this helps! ;)

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Permalink Reply by Nikki on November 17, 2008 at 1:54am

This is great advice, my one client that I'm charging $15 an hour is enough, just enough to survive. However I have another client I'm working for to pay off my laptop. Which isn't much more then an hour a day. Since I'm expanding my own services (to include SEO, advertising, email blasts) that I'm not really good at I don't plan on charging a lot of money for those services because I'm not good at them yet.

You are correct in the costs, my one client was going to go with an over seas service, so in order to keep him, I had to lower my price to $10 an hour. There is more to that story but I really don't want to get to it. Lets just say lesson learned, don't trust anyone that calls themselves a "friend" as they will stab you in the back. However, he has decided to take on some of my other services as this other girl would charge him only $8 an hour to do the same work.

I like the packages idea. This way you already know the work and know the amount your going to get paid. I don't like the "per hour" as it just makes things uncertain and gives the customer the chance to say "well, next month I'm only going to want 1/2 the hours" where as if they don't know how many "hours" you are working they can't say that.

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Permalink Reply by Kathie M. Thomas on December 22, 2008 at 4:47pm

Nikki, there is a formula you can use that's available on Nina Feldman's site. It's important you work out your base rate $$ per hour and then add to that expenses or other things. I used a different formula I found many years ago and periodically review it just to make sure I'm keeping above my overheads. Very important.

Also, I encourage you to mention your currency on forums as we are international and I can tell you that $15-$17AUD would send you broke in a very short time. There is no way we would be charging that low - we couldn't. But I expect you mean USD which is different, however to me, that still sounds low.

Never lower your prices for clients - that won't help your self-esteem and they will tell others how low you are and before you know it you'll have heaps of clients coming to you expecting the same. Stick to your guns, do your research and charge what you're worth. I've knocked back clients who tell me what they will pay me - I always tell them that my rates are my rates and I'm sorry, but if they want it at a cheaper rate they'll have to find someone else.

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