Let’s begin with where I messed up.
When I started my business, I looked around online at what others were doing and saw that in almost all cases, they’re prices were lower than mine or what I deemed to be higher quality. Comparison really is the thief of joy and it will hold you back each and every time.
Don’t do that. (Well, you can, don’t take it personally. Everybody is different.)
I talk a lot about my most recent brand audit and that’s because it gave me the confidence boost that I wish I had when I started Tangible Designs. I felt better about what I was doing and even more, in the direction I was going. As entrepreneurs, we have to remember that our price is what it is for a reason. It’s what we believe our products/services + our time is worth.
Let’s take me, for example. Some people think that the process of designing a logo is
- Draw logo.
Nope. Let’s break down a few things that I take into consideration when pricing my products:
- My time
- Licensing for design elements that I paid for (fonts, textures, etc.)
- Edits (this could be easily lumped in with time)
For the entrepreneurs who are just starting up and/or lack the confidence to price what we sell, we feel like if we charge too little, we can’t pay bills. But we’re also afraid that if we charge too much, we won’t get clients. Here are some things that you should consider when pricing your products and services.
- Your time – There’s no right or wrong way to factor this into your price. You are stopping everything else you’re working on to focus on this one thing. You don’t need to do this hourly, but it’s nice to have a base point at which to start.
- Your materials– This is especially true for entrepreneurs that make handmade products (jewelry, clothing, etc.) Items that you make cost money to make. Paintbrushes, fabric, whatever. It costs money.
- Your equipment – If you’re a business coach, what do you need to do your job? A phone? Computer? Possibly a wi-fi hotspot? Anything that you need to do your job wherever you are is your equipment.
- Your space – Do you have an office building? Do you work in a shared workspace? You pay money for that, right? Consider this when you’re about to list your costs.
- Your service providers – If you utilize a passthrough printing service, they will tell you how much it costs for them to print your product, whether it’s a book or a coffee mug. A lot of the time, they will also drop ship the item for you.
- Your shipping costs – This won’t apply to everyone, especially those of us with digital products and services. If this applies to you, don’t forget about this! Omitting shipping costs from your overall price, whether location-based or a flat rate, can hurt you in the long run.
- Your cut – While folks don’t like to mention this a lot, you need to factor in how much YOU get. This can be substituted for time, if necessary. This is your job. Don’t you deserve some pay?
How can I get around some of these costs?
If you’re just starting out and don’t have a lot of capital, the reality is you may not be able to and that’s a hard pill to swallow. Sometimes, cutting the cost of materials means buying in bulk. However, if you can’t do that, only get your materials when they’re on sale or you have a coupon and get them when you are financially able to!
While you may not be able to get around these costs, you can save money in other places. Want a fully customized logo? I can do that! If you’re in a spot where you’re ready for more, check out my new custom bundle. Add what only what you need. Period.