Nine Factors to Consider When Determining Your Price

by Collis Ta'eed

Part guesswork, part experience, part number crunching - how ever you look at it, determining your price is a difficult task. Here are nine factors to take into consideration:

1. Your Costs
If your rate doesn’t include enough just to break-even, you’re heading for trouble.
2. Your Profit
Somewhat related to your costs, you should always consider how much money you are trying to make above breaking even. This is business after all.
3. Market Demand
If what you do is in high demand, then you should be aiming to make your services more expensive. Conversely if there’s hardly any work around, you’ll need to cheapen up if you hope to compete.
4. Industry Standards
It’s hard to know what others are charging, but try asking around. Find out what larger businesses charge as well as other freelancers.
5. Skill level
Not every freelancer delivers the same goods and one would expect to pay accordingly.
6. Experience
Although often bundled with skill, experience is a different factor altogether.
7. Your Business Strategy
Your strategy or your angle will make a huge difference to how you price yourself.
8. Your Service
What you provide for your clients will also make a big difference to your price tag.
9. Who is Your Client
Your price will often vary for different clients.

Give it lots of thought
The more you think about your reasoning behind your price, the easier your quoting will become. Like all these things there is a large amount of trial and error and often you will find yourself constantly changing up your pricing and gauging the ratio of jobs lost to jobs won.

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