“People are always asking me to help them, but I don’t know how much to charge.” Does this sound familiar?
You have the knowledge. You have the experience. Yet, when someone asks you to help them on a project or take them on as a client, you don’t know what to charge. You become frustrated and either don’t charge and you do the work for free. Or you don’t do it at all.
This seems to be a common occurrence for people who want to start their own business. At first, I encountered this issue when I started my speaking business. Then I went back to my experience as a product manager when I had to develop products. Here are some of the steps I took to set the product or service rates:
- Benefit and Value: I had to think about the benefit to the client and whether are not they will see the value of the product. If the client cannot see how the item or service will benefit him or her, they will have a hard time understanding its value.
- Cost: I had to determine the cost of providing the product. Think about the raw material, the manufacturing and shipping costs; if it’s a tangible product. Or if you are offering your service, assess the time it takes to offer that service. This includes the time for researching, writing, etc. Your time is valuable.
- Competition: What are others charging for the same item or service in your marketplace. Keep in mind that the rate sometimes vary by region. You don’t want to be the most expensive in the area unless you can demonstrate that your product or service can command that rate. Yet don’t be the cheapest on the block. Your clients may not appreciate you; if you cheapen yourself. Your product or service becomes a commodity at that point. This lessens its value.
- Return on Investment (ROI): When you present your product or service, you have to learn to show the client, his or her return on investing in it and in you. Show your clients the outcome of utilizing your product or service. Give them the before and after picture. This will help them in their purchasing decision. Make it a compelling one that leaves them without doubts that it’s best to sign up with you.
- Value Your Knowledge: If you don’t value your knowledge how would you expect someone else to do so? Value what you know and keep building on what you know. By keeping up-to-date you increase your value.
Next time someone asks you to help out and they are willing to pay you, take the time to determine your worth. This person asked you, because they believe you have something that they need. Set the rate and value. Know that You are Worth It!
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Marlene M. Bryan is a Distinguished Toastmaster, DTM. She is a certified speaker and leader by Toastmasters International. She is currently the District 47 Public Relations Officer, and leader of the Public Relations Team. She provides her services to over 3800 members throughout the district. Marlene is the owner of Marlene M. Bryan, Corp and Small Biz Evolution, LLC. She is a speaker, an author, and a coach. Pick up the latest copy of her book: