Don’t Price Your Services Too Low
You are seen as a risk if you cheapen the value of your work
When pricing your services, it is extremely vital that you don’t provide a low price point because you’re afraid of losing the prospect. Yes, sometimes clients shop for price—these aren’t the people you want to serve. You want to work with clients that are shopping for value, that are willing to pay for the result of the work rather than the time it takes to get it done.
When you provide a low price, you cheapen the value of your work. You tell the client, “my work costs this much because I’m not confident that I will be able to succeed.” When you charge a premium price you are telling the client, “you are paying for the revenue that this work will get you.” This doesn’t mean that you can guarantee that you will bring your client more revenue, but the price does allude to the success you’ve brought to previous clients.
Can they afford your work?
When pricing your services, always make sure you have an estimate of their total budget. This budget includes the pricing of your services and all of the other costs involved in hiring you. In marketing for example, if you’re charging $2,000 a month to manage ads, that may be too high a price if the business only has a monthly ad spend budget of $300. If however, they spend $10,000 a month on ads then your services are reasonably priced.
There is a lot of thought that most go into how you charge your clients, but you should always try to avoid pricing your services by time spent. The only moment charging by time is relevant is if your physical presence is required for the job (or if the client’s brand is so big that working for them will elevate your own brand).
In most cases, if you are doing your work remotely, you’re a creative vendor, or you provide consulting services—you should charge by value and intended results rather than by time. And make sure the price is relative to the size of the client and how much revenue they make.
Image Credit: Unsplash