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    How do determine the price of your service?
    This is address to those who offer services as a product.

    It's quite easy to price a tangible product because you have something to start with like the buying cost or manufacturing cost, etc.. But when it comes to service how do you determine your "selling price".

    Do you sort of spy your competitors and based your price a little lower or higher. Or do you compute by the number of hours that you will devote in delivering your service and multiply it to $10 or $20 depending on your hourly rate? (I hope you get what I mean. )

    By the way, the service I'm talking about is Wordpress blog complete set-up (including content).


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    I used a combination of all methods when I was determining the price of my hourly rate at first. At the start, I tried to see what my competition was charging, and I considered asking a lower price at first since they presumably already have a lot of experience at the time. Next, I also looked at the local market and my own personal needs and expenses as well to see if the price would be a good enough amount to cover them and still acquire a good amount of profit enough for me to see it as being worth it. I think any amount you think would be fair to you and your potential customers while still being able to be competitive with the rest of the competition would be good.


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    Generally for a service your price is Materials + Time + Expertise. I would start by looking at what others are charging to get an idea.. So, for building wordpress sites your overhead is probably pretty low (just a computer, electricity and a workspace, most likely), so think about the number of hours you'll spend on a project and set a reasonable hourly rate for yourself based on your experience. Remember that beginners take longer to complete a project, but a beginner's time is worth a lot less than an expert so experts should still charge more per project.


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    As someone mentioned above you should take into account your competitors, your experience, and your quality of work. Decide how much will work for you taking all those things into account. If you charge more than competitors, explain why. Sometimes people will pay more just because they know it will be quality work and will be delivered on time.


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    For the sort of service you're offering I think it would be best to price your services a little lower than your competitors at the start. This is because, if you set your prices too high someone will just go to freelancer.com and hire a desperate expert at very low rates. That's why when you're starting out, you need first to establish yourself [by setting your fees a little lower] before either increasing the fees you charge or outsourcing the work and getting a cut from the fee charged.


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    It all depends on the quality and also how your competitors are pricing their services. You do not want to overprice or under price your services. If they are overprice then people will not buy them due to they are expensive then if under priced people will think they are fake.


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    Thank you for your inputs guys.

    I'm now making a list of things to consider. I know I can't just price my product based on my hourly rate because If I do - My complete service will cost over a $1,000.00. I'm quite certain that others can offer it for a whole lot less. So I guess I have to offer it for less in the beginning and build my online reputation first so I can command a higher price in the future.


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    Quote Originally Posted by eppie View Post
    This is address to those who offer services as a product.

    It's quite easy to price a tangible product because you have something to start with like the buying cost or manufacturing cost, etc.. But when it comes to service how do you determine your "selling price".

    Do you sort of spy your competitors and based your price a little lower or higher. Or do you compute by the number of hours that you will devote in delivering your service and multiply it to $10 or $20 depending on your hourly rate? (I hope you get what I mean. )

    By the way, the service I'm talking about is Wordpress blog complete set-up (including content).

    The best way to determine the price of your service is to examine the prices that your competitors are offering. This will determine the market value of your service. From there you need offer a price that is competitive with market value. If you choose to go over the market value. You will not receive much business. Especially in this economy. People are looking for all of the bargains they can find.


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    It's just business.
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    Looking at what your competitors are charging is definitely one of the factors when it comes to determining the price of your service. The key is figuring out what’s going to get you the best penetration in the market as fast as possible, and broadening your client base according to what your competitors are not doing with their pricing models.

    At the same time, you don't have to commit yourself to a single price. Tiering your pricing structure allows you to sell your services to people early on the notion of a price, and then add options that ultimately will help you increase your bottom line.


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    You need to look at the expenses that you have and then do some markups or even just a little above breakeven, if you're offering a unique product you can increase your price range to have good income.


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