Whether you are first starting out or wanting to overhaul your pricing structure, there are pricing strategies that will help you determine your rates! At first, it may seem daunting and confusing! Some of the considerations will include: 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. So, let us dive into some of our favorite ways for you to determine your rates!
Easy Pricing Strategies
One popular method is to use a calculator such as the one found on Melissa Ingold’s Time Freedom Business. These calculators will quickly identify what you should charge to reach your income goals. Thus, they are a great place to start.
However, in order to create a solid pricing structure, you will need to do a little more digging. So with your starting number in line, take a look at:
This might take a little detective work, since some businesses and service providers will not actually publish rates. But if you pay attention to their websites and social media, and ask a few discrete questions, you can figure it out!
Be realistic about who, exactly, your competition is, though. Do not undervalue or over-sell yourself. In other words, make sure you’re comparing yourself to another business that shares the same skills, market, and track record, rather than simply looking at who you strive to become.
Pro tip: If you are a graphic designer fresh out of school, you might just be the most talented designer in the world (hey, it is possible!), but charging premium rates prior to gaining industry cred can shoot you in the foot!
Your Skills and Track Record
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 have 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)? If you are a coach, have your former clients moved on to bigger and better coaches after working with you? (Believe it or not, that is a good thing!) These are all reasons to consider charging a higher rate than you might have first thought.
In the game of setting rates, your market will always have the final say. As any first year economics student can tell you, the price of anything lies at the intersection where “what the buyer is willing to pay” crosses with “what the seller is willing to accept”.
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 is important to acknowledge. If, on the other hand, your target market is more established and economically stable, then a higher fee isn’t just warranted—it is 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 financial advising).
After you determine your rates, always remember that pricing is never set in stone! It is flexible. If you find yourself attracting the wrong market (or no market at all) you can always change your rates! Or perhaps, if you find yourself working too hard for not enough return, then raise your rates!
Determine your Rates – Final Thoughts
Ultimately, there are ways to help you determine an appropriate rate for your services and goods. It will just take a little research and then some trial and error.
We strongly suggest that, over time, you review your rates and make changes when necessary!
Pro tip: You are probably worth more than you think. Just move your ego out of the way when determining a rate!