Charging the Right Prices for Service-Based Businesses
Charging the Right Prices for Service-Based Businesses
Charging the Right Prices
It’s a different ball game if you are in the service industry, you can’t charge for services the same way that people who manufacture or sell products would charge their customers.
However, it’s still essential that you get enough compensation for your efforts.
Charge a Fixed Price for Your Efforts
You should have a fixed price that you would typically charge your clients for your services, whether per hour, per month, or per project completed. This should be the minimum or the base amount that you feel would be adequate to compensate you for your efforts – you are never going to accept less than this from any client regardless of who they are.
Consider all Expenses
As a service-based business, it’s easy to lose sight of some of the expenses that you may incur in the costs of carrying out your duties. It helps to have a standard form with all the potential costs that are related to your nature of business printed on this form so that you can just fill in any expense that you incur along the line, and recoup it from your clients so that you can prevent a lot of losses.
Use Perceived Value
Try to understand what your service is worth to your customers, and use this to fix prices for your services.
A person whose only home is under attack from pests would be desperate to get rid of the pests from their home. You can get such people to pay a decent price for your pest control services, unlike a person who has a second home somewhere that they can move into temporarily until they can get rid of the pest infestation in their home.
The more need a person has for the services that you provide, the more value they would place on it, and the more money they would be willing to pay you for your services.
Consider Competitor’s Pricing
It helps to look into the prices that your competitors are offering their services for and set your prices to be competitive too. You can pretend to be a customer, or assign the task to one of your employees to pretend to be a customer to your competitors, and find out their rates so that you can change your prices and make it competitive.
Monitor and Change Your Prices
Continue to monitor the trends and changes in the industry, and set your rates accordingly.
There are more tips and advice about pricing in the book ”Business Life for Women”.
Do you want more practical tips like this? Go ahead and download this inspiring book right here. You can get a free review copy now before the official launch Monday, May 28th. It is loaded with practical tips.
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Holger Wästlund
