Price your services

- Setting prices is tricky.…You have to ensure you make enough money…when you're delivering services…to cover the times you're not making any money…because you're selling…or you're doing administrative work…and you're not on a project.…Your pricing model must make sense,…whether it's project-based or fee for service.…The model should be consistent across clients,…comparable to competitive offerings,…and have flexibility to offer discounts or promotions.…

With a fee for service model,…that's where you're getting paid on an hourly…or daily basis.…This is a good model if you're not sure…how long a project is going to take.…If scope grows, so does revenue.…The downside is, you're at fixed rate.…You can only bill for eight hours a day.…A lot of people come to me and ask,…how do I set my hourly rate?…I learned a great formula a long time ago.…Somebody told me when I was in corporate…that I should take my total cash compensation,…so it was my salary plus my bonus,…multiply that number by three,…then divide that number by 250,…