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How To Determine Your Service Prices
How To Determine Your Service Prices
Posted By - Timothy Cole
Category - Business Tips

Do you struggle with determining the price of your service(s)?

 

Do you feel insecure about the rate you currently charge or the price increase you

want to make for your offer?

 

Confidently deciding on the price for your services & having a clear understanding

of your value sets your business up for sustainable success in the marketplace.

 

In this blog post, I want to challenge you with several questions that will help you

create clarity around your services & pricing.

 

Question 1: What are my overhead costs?

- What do you have to purchase or keep maintaining in order for your service to

function effectively? Letʼs say you run a local cleaning business. What cleaning

products do you bring to the job? How long does a bottle of that particular spray

last? How many rolls of paper towels do you go through in a week? Do you have an

office or storage unit that you keep all your supplies at? What are the monthly

expenses for that building? Overhead costs need to be calculated so you can

make the best profit. When you first start your business, you might not know all

your overhead costs until you pick up the pace with clients or customers. Thatʼs

alright! As you learn more about your required expenses, add them to the list.

 

Question 2: What is my income goal?

- How much profit do you want to make in a fiscal business year? Profit is what

you take home after you have paid your overhead costs or invested a particular

amount of the income back into the companyʼs checking/savings account. Perhaps

before you became an entrepreneur and created your services, you worked in the

corporate world. If your salary was $80,000 a year, do you want to match that

yearly salary or increase the numbers? Do you want to work the same hours as you did in

corporate or do you want to work fewer hours and yet make more money? Have a

definite chief aim for the amount you want to bring home. Also, knowing how much

you want to make in a quarter or year will help you determine how many clients

youʼll need to work with.

 

Question 3: What do I believe is my value?

- If you are not confident with who you are & what you do, that energy is going to

be felt by potential clients. You have to believe in the value that you bring to the

table. You have to believe that the services you offer can benefit your ideal clients

& help them create change and get real results. What do you believe you are worth

per hour for both the knowledge & experience you have? What would you be

willing to pay somebody else for a similar service with similar knowledge &

experience as you? As Jim Rohn said, “Your level of success will rarely exceed

your level of personal development because success is something you attract by

the person you become.” As you continue to improve as a human being and invest

in your growth, education & experience you will find yourself discovering your

worth and youʼll see your value increase the more you invest in you.

 

Question 4: What is the competition charging?

- What are other real estate agents charging for home staging in your state? What

are other chiropractors charging for an appointment? What are other social media

managers charging for (x) number of posts? I would play detective and visit the

websites of your competition to see what the common prices & packaging options

are not only for your industry but what about your particular state or city?

 

Question 5: Who am I here to serve?

- Connect with your brand avatar and remind yourself of who they are & what they

do. If you are a personal trainer who wants to train men in their 30ʼs who work in

corporate America, they probably have a decent yearly salary where they would be

willing to pay an increase for quality training. But if youʼre a personal trainer for

guys who are busy earning their college degree, their income level is probably

related to part-time hourly work. You can find a price where your value isnʼt

diminished but the people you want to work with are able or willing to invest their

hard-earned money for your service.

 

Question 6: What are my service package(s)?

- When it comes to your particular service, do you charge by the hour? Do people

work with you on a daily, weekly, or monthly basis? Do your programs run for a

month, a quarter, or half a year? How long do you want to work with a particular

client? Would you rather work with a few clients long term or many clients short

term? Decide on how many service packages you want to offer & what would be

included in each of them.

 

I would encourage you to practically answer these questions with traditional pen &

paper.

 

We want to visually brainstorm our next best steps for deciding our service(s)

pricing.

 

What do you currently charge for your service(s)? How do you feel about your

rate? Are you looking to make a price increase?

 

Let me know in the comments below and if you would like to discuss this topic

farther you can contact me at timothy@tlcole.com

- Timothy L. Cole

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