If you are reading this, there’s a good chance you have no idea how to price your services. Don’t worry mate we got ya! We’ve all been in this situation before, no one likes having their pants pulled down in regards to pricing.
Here are some of our tips to help you set your pricing:
Set A Clear Revenue Goal
To grow your business you can’t set a number that sounds good and think, “she’ll be right.” Set yourself a clear, realistic goal, and to keep yourself on the right track, you should be checking it yearly, quarterly, or even monthly. Never be afraid to re-evaluate if you aren’t hitting your goals.
No idea how to start? It comes down to the research you have done already from pricing, your industry, how long you’ve been in your industry, past clients, and potential clients. Even one year of figures will provide you with a cute load of knowledge on how to conduct your next 12 months.
Understand Your True Costs
This can be a scary one, your revenue goal needs you to look more at your actual costs. It’s all well and good making $X but if your costs are $XX then it’s time to have another look.
Here are some questions to ask yourself:
- How much do you invest in your tools and inventory?
- Are you paying for storage or a warehouse?
- How much are you spending on marketing yourself?
- Are you outsourcing extra labor-hire?
Access The Market Potential
Your first step to determine your potential market should start with these questions:
- Who are my potential customers, and where can I find them?
- How steep is the competition?
- How does your service stand out from the competition?
- Do you know what your customers are willing to pay for?
- Do they see the value in your service?
Check Out The Competition
Unfortunately, if you think you’ve come up with a unique business idea, someone’s done it first or something similar. (Unless you’re Aussie Man Hands). In a crowded marketplace, it’s vital you collect as much info on your competition as possible to give you the edge.
With everyone and their Nan glued to social media, it’s actually easier now than ever to have a good stalk of your competitors online. Don't actually physically stalk them. That's bad.
A big question to consider is whether you should undercut your competition or increase the value of your services. That's something you'll have to decide for yourself.
Setting your prices can be a bloody stressful and lengthy process, but it’s worth it when you get a clear understanding of your marketplace.
But if you don’t start you’ll never know, right?