What You Should Be Charging For Your Services

You know how important it is to "monetize" your business, but what does that mean? And how do you go about doing it? The answer is not as straightforward as you might think. In fact, we've found that there are several factors that affect how much money you should be charging for your services and products. That's why we're here to help! We'll walk you through what those factors are, then give examples of companies who successfully monetized their services so that you can see exactly what we mean.

What are your expenses?

Knowing your costs of doing business is essential, as you need to know what services and products you're selling and how much they cost. This will help you determine the right price for your services, so that you can cover all of your expenses, leave room for profit, and pay yourself a fair salary.

If there's one thing I've learned in my years as a consultant is that most people don't think about their costs enough. If all of us did this better would we be able to make more money? Yes! The first step towards making more money is knowing where it comes from - income!

What is the difference between a service and a product?

A service is an experience that you provide to a client, usually in person. An example of a service would be coaching someone through their first time using Photoshop or introducing them to the concept of mindfulness.

A product is something you create and there are many different types of products - books, clothes, paintings, websites, etc. Examples of services being offered as products include online courses and e-books about your area of expertise (see our How To Make Money Writing E-Books guide).

You can also offer both products and services within your business model; for example I sell my ebook but also offer webinars to teach people how they can build their own business.

Do your research.

The first thing to do is research what your competitors charge and what they're worth. You can't compare yourself with big companies who have a lot of overhead and employees, but you can get a sense of how much it costs to run a business like yours. If you have any friends or family members in the same field as you, ask them about their finances so that you can see what they're making (or not) for their services.

You should also research the going rate for your services, which will help both you and your clients understand what's reasonable to expect from one another. In some cases, this will lead directly into the next step: setting prices by examining profit margins, overhead costs like rent and utilities; labor expenses such as wages paid per hour worked by employees; employee benefits such as health insurance plans offered with employer contributions toward premiums; taxes paid quarterly/yearly based on income received during past tax year(s) (which varies depending on country).

Don't be afraid to change your rates.

The best way to decide what you should be charging is to take a look at your historical data and see where it says you are losing money, or where you are making too much. If you are consistently losing money, it's time for a price increase. If your prices are too high and clients aren't willing to pay them for services like yours, then maybe it's time for a reduction in price. You'll have to weigh your options as far as whether or not this is worth doing - but if there's no money coming in because of overpricing on the part of the clientele, then yes: change it up!

It's also important not only to watch what other people are charging for similar services but also keep track of how much their service costs them (and therefore how much profit they're generating). This will allow you a good idea of when something is priced too low or high compared with others in the same industry; either direction can be harmful depending on who has more control in business negotiations: The buyer or seller?

Give yourself time to grow.

You should never feel pressured to change your rates. Sometimes it's better to be consistent and profitable than it is to hop on every trend that comes along. If you've been charging the same rate for years, don't worry about updating your price list just for the sake of doing so. Your clients will appreciate knowing what they can expect out of working with you - and if they're happy with what they get from you now, then why change?

It's always good practice to regularly assess whether or not your industry has changed since you last set pricing for yourself and/or for others in your field (if applicable). In other words: does this thing I do still cost this much? When it comes time for an update, consider evaluating a few factors before making any changes:

• Are there more competitors in my niche?
• How much competition am I facing specifically?
• Are their prices higher or lower than mine?
• What are my clientele's expectations when it comes to pricing; how do their budgets break down (i.e., 20% of all clients spend over 50k per year)? Do these correspond at all with larger industry trends?

You should know what your value is as a business in order to charge accordingly.

When it comes to pricing your services, you should understand what your value is as a business. This means having a clear idea of what your business is worth and being able to articulate what you do and what you offer in a clear and concise manner. An example of this would be when someone says, "I'm an accountant who helps small businesses plan for tax season." This communicates their skill set very clearly: They are an accountant with experience working with small businesses on tax planning.

The next step is to decide how much time you're going to charge for each task or project that comes across your desk - and how much time it takes away from other work activities. Try not to think too much about charging less than the going rate; instead, just focus on charging enough so that everyone wins (including yourself).

Conclusion

Charging for your services can be a huge challenge when you're just starting out. But as long as you know what your value is and can back it up, charging for your services shouldn't be too much of an issue.