The secret to knowing your worth (& being able to charge it)
Pricing is a highly contentious topic, particularly if you haven’t been in business for long and/ or haven’t yet been paid for your work too many times.
For those who are new in business, the temptation can be either to adopt a pile ’em high, sell ’em low pricing strategy OR to charge what you see others in your niche charging and think you should automatically charge that too.
In reality, there are multiple factors that come into play and all should be considered before a pricing decision is made.
Firstly, and arguably the most important factor, is your experience.
It’s easy to underplay and undervalue the experience you’ve built up during your career or to brush it aside, but the fact is that entrepreneurs with life and career experience, whatever industry or path that may be from, make better business owners. Don’t undervalue your experience.
Next it’s time to work out your numbers. How much does it actually cost you in hard costs, any external costs AND the time it takes you to deliver the service or create the product. In my business I have to cover the cost of my Virtual Assistant, my office rent, my software, tax and more before I actually make a profit. All businesses have these costs and they must all be covered and more, otherwise you’re subsidising an expensive hobby.
My next point is less practical and more about listening to your gut. Before you start discussing your prices with clients, it’s vital that you feel completely comfortable with whatever price you are planning to charge. Otherwise you won’t be confident when you tell people what the price is and if you don’t have confidence around what you’re charging, the buyer won’t feel confident enough to pay it, whatever the amount.
So spend time really thinking about how much you truly believe your product or service is worth, taking into account all of the above, and get comfortable saying it (you can even practise out loud, seriously, this will help).
Your competitors are somewhat important, but only to a certain degree. Don’t assume that the price your competitors are charging is right for you. They will have different experience, overheads and a different audience from yours, so what works for them won’t necessarily work for you and vice versa. That being said, you need to have a certain level of awareness of the ‘going rate’ in your industry so that you can decide whether to charge more, less or roughly the same.
Finally, remember that the most important thing to do in business is to offer a fabulous service, or create an amazing product that really answers your customers’ needs. Doing this will enable you to do two things; firstly you will achieve the ultimate goal of word of mouth referrals (i.e. free marketing) and secondly, you will be able to charge more AND raise your prices more frequently.
I’ve recently changed how my business is structured to open up more space for 1-2-1 clients. So if you want to know how you can raise your prices, as well as to gain regular accountability and the support to actually start earning more money, you can check out my packages here.