What’s your pricing technique for your service based business?
Do you have a pricing strategy or do you just pull numbers out of thin air when talking to clients?
If you’re a someone who is stuggling with creating a pricing plan, this blog post is for you.
Freelancers can at times struggle with creating a pricing model however long they’ve been freelancing.
Pricing techniques is all about deciding your strategy as to what and how you’re going to charge your clients. The pricing techniques that you decide to use will depend on how long you’ve been freelancing and your confidence in showing your pricing.
Freelancers new or seasoned can sometimes get scared by the thought of telling clients our pricing.
Start shifting this mindset block as it’s doing nothing but harming your freelancing business.
Early into my freelancing career, I was watching a webinar presented by someone from the UK. Anyway she said
At a time of Covid-19, this is even more powerful as we are desiring to help people where and when we can.
Part of what needs help is the national and local economy.
If the idea of asking for payment is hard to do, think of how that money helps.
You’re earning money by working with clients.
This money is then put back into the economy through taxes.
Even if it’s just VAT on your shopping, this money is going back into the economy and the shopkeeper.
If you’re struggling, use these 5 pricing techniques for freelancers that attract clients to your freelancing business.
5 pricing techniques that attract clients
There are 5 types of pricing strategies you can use in your business.
Each of these different pricing strategies represent what stage you are at in your online business.
Time-based pricing techniques in simple terms is charging per hour.
This pricing strategy usually works well for new freelancers in their first year or two freelancing.
New freelancers tend to prefer the time-based pricing technique as they’re unsure of how long it will take them to complete tasks.
Even what the market value is of their freelancing services can be tricky for a new freelancer to judge, especially when they come across job boards offering the same services for only $5.
You don’t want to tire yourself out working for next to nothing.
You’re running a business which is what will be your main source of income.
Develop an hourly rate that’s fair and takes into consideration your expenses and living costs.
To work out your hourly rate you need to start with your end goal.
End goal as to how much you want and need to earn per year.
Next, you need to consider how many hours a week you can work plus the amount of weeks a year you can work.
Be very realistic about this and take into consideration all the things that life throws at you and your need to take a break so you can relax to refresh your mind.
Time-based pricing strategy example
Desired yearly earnings £24,000
25 hours per week
48 weeks a year = 1200 hours worked per year
Rate per hour is £20 per hour
At a rate of £20 per hour and working 25 hours a week will equal £500 a week.
Just don’t forget that part of the weekly income will be taxed so don’t go spending straight away.
But for a new freelancer and using the pricing techniques further in this blog, this is a real prospect for you to make £20 an hour.
When you’ve been freelancing for awhile or are completely confident about everything you can deliver, then it’s time to create packages.
Packages are a collection of services that will deliver a specific result for a client.
For example, if you offer sales funnel services and can create a complete sales funnel for a client within a specific amount of time, you can charge a project rate.
As with a sales funnel project, you would have a whole package of different services that has to be included such as
- Marketing automation
- Graphic design
- Facebook Ads campaign
- Google Ads campaign
With this bundle of services you’re charging a specific price.
This price doesn’t change if you get it done quicker in the time or it takes a bit longer than expected.
To work out how you should price your project really depends on the amount of work needing to be done.
Although ultimately, project pricing is more about what value you’re bringing to the client.
Present the price at the right time
When your clients are making a buying decision, the first thing that influences that decision-making process is their emotions.
In fact, 56% of the final decision is based on emotional factors.
As part of your pricing technique, you need to present your pricing at the right time.
How do you know when the client is at the right point and needs to buy your services?
You build a relationship with the client first and build the know, like, and trust factor.
Building the know, like, and trust factor starts with when you generate awareness around your freelance business.
From the start of generating awareness of your freelance business, you want to be storytelling the results you bring your clients.
Also, throughout awareness you want to show why potential clients need your services too.
As potential clients can not always know that the services you provide is what they need to achieve a specific result.
After you’ve created this awareness and the potential client has started to show interest in you by engaging with your posts, it’s time to build on the relationship.
Build on the relationship by looking at the potential clients business, ask about their future projects, and take a real interest in them.
This is when you can really start to build the trust because you’re going to do something now that will get you one step through the door.
As you’ve investigated the clients business and there future plans, offer free advice or a low cost service.
It may sound counterintuitive, especially if you’re trying to get high ticket sales, but it works.
This pricing strategy works as the client trusts that you have some real expertise in your area or can deliver the results you promised.
When the client wants to know the price immediately
There are many times when you are trying to talk to a client about your services, yet all they are interested in is the price.
We’ve all been there.
Delay answering this question as much as you can.
You need to present the value that you are giving them in your services first before sharing your prices with clients.
In the clients’ mind, they’re thinking they know what they want.
What the client doesn’t know is the value that you can really bring them and their business.
Before you answer the question about how much you cost, you need to share what value you’ll be bringing the client by hiring your services.
Now you’re probably wondering how on earth do you convey the value of your freelancing services.
It’s really quite simple really, you just need to find 2 or 3 case studies of previous clients you’ve worked with who wanted the same or similar services as the current client.
In your case study, really convey where the client was when you met them and the results that they desired.
Create a picture of the journey as to how you helped them and then the end results.
Use power words in your case studies and use visuals (if you can) to really show the client how you’ve helped previous clients.
If you’ve not had any previous clients and this really is your first client, showing your results can sound very tricky to do.
Overcome this problem by getting creative and create samples.
Create samples by using dummy clients or your own freelance business.
Do the work, get the desired results, and use this as proof for the clients.
Always get visual evidence.
Visuals such as screenshots and any graphics that were used in creating the sample.
Show results not features
Clients ultimately care about the results a freelancer can give them.
Yes, they may have a budget in mind, but is it a budget created without any knowledge of the true cost of the freelancing services they require.
This is when you come in and show the client the results.
Showing your results to potential clients is powerful.
What’s even more powerful is using visuals in showing potential clients your results.
Create a portfolio, case studies, or testimonials from previous clients.
Having a portfolio or other visuals will give the clients the wow factor and warm them up to buying your services.
When creating a portfolio that will wow your clients, focus on what your ideal clients want.
Focus on the industry your client is in and the services they need to help them in their own business.
Before you start creating your own online portfolio, here are 5 mistakes many freelancers are making and you want to avoid at all costs.
This final strategy in these 5 pricing techniques is probably the most powerful that you’ll ever use in your freelancing business. Powerful because it’s when you’re talking to what the client really does desire. Utilize this time in your pricing negotiation and show off your results.
In A Nutshell,
Freelancers can at times struggle with pricing however long they’ve been freelancing. If you’re struggling, use these 5 pricing techniques for freelancers that attract clients to your freelancing business.