How To Price Your Services | Sílvia Pinho | Skillshare
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5 Lessons (18m)
    • 1. Intro

      1:55
    • 2. Lesson 1 hourly

      4:24
    • 3. Lesson 2 retainer

      4:10
    • 4. Lesson 3 package

      6:03
    • 5. Outro

      1:24
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About This Class

Are you a beginner freelancer wondering how to price your services?
Or maybe you've been charging the same way forever and are now considering other options?

I've got just the class for you! In this class, we'll discuss the 3 main ways of charging for your services:
- hourly
- retainer
- package

I'll go through the benefits of each one, and what/when they're better suited for, so you can use this information to make an informed decision for your business.

In the end, I'll share with you a class project, using my package rate calculator below.

If you have any questions about the class or pricing in general, don't hesitate to leave them in the comments and I'll do my best to help you!

Package rate calculator (make a copy before using): Rate Calculator

And here's my other Skillshare classes: https://www.skillshare.com/user/thesilviapinho

Meet Your Teacher

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Sílvia Pinho

Social Media Manager & Online Educator

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Transcripts

1. Intro: Hey everyone, My name is Sylvia and welcome to my new Skillshare class. If you don't know me, I'm a social media manager and business mentor from Portugal and I love talking about starting and running your own businesses, marketing yourself both on Instagram and Upwork and much more. So if those are topics that interest, you don't forget to hit follow right here on Skillshare so you don't miss out on my next class that he said Today's class is all about pricing. So whether you're a new freelancer or service provider looking for the best way to charge your clients for your services. Or even if you're not bring you and you've been doing this for awhile, maybe a change and looking and you're wondering if there's a better way to charge for your services, then this class is definitely for Yale. I got to say there's this ongoing battle, almost hourly versus fixed priced. And I've been on both sides. I've done both hourly projects and fixed price. I do work fixed price now, but I understand both the pros and cons of both sides and that's what I'm hoping to portray to you guys today in this class. Now, I've been doing this for about seven years now, a little over seven years. So like I said, I've seen both sides of the coin, I've seen the primes and cons of both sides. And I'm actually going to be presenting to you guys three main pricing structures that I've come across over the seven years working as a service provider. So you guys can overall have a better understanding of what you're getting yourself into as you can make an informed decision that best fits your needs. So no matter if you're a designer, a video editor, a social media manager, or a VA, you can apply these tips to whatever service you provide your clients. And hopefully you'll find a way that works best for you after this class. So without further ado, why don't we get to the lesson number 1. I'll see you inside. 2. Lesson 1 hourly: Alright, less than number one, let's start off with, I guess the most popular way of charging, specially amongst people that are either just starting out or I guess in their first year of business, which is Arlene. Arlene, like I just said, I would recommend it mostly for people that are just starting out and maybe don't have a good idea of how long a project is going to take you. So it would be harder to come up with packages, then it would be to create an hourly rate for yourself. And to be honest, I recommend you have an idea of your hourly rate before you get into price, seeing your packages, before you get into pricing your services and the package rate, I guess the first step to pricing yourself is the finding that hourly rate and maybe taking on some projects and that pricing structure to get used to it. There's definitely pros and cons to charging hourly. The pros of ID would be that, you know, like, okay, I worked this amount of hours and I'm going to get paid exactly the right amount for the time that I worked. So in my opinion, especially if you're just starting out once again, it's the fairest way to charge, but there's definitely some downsides to it. Well, there's low risk involved because once against certain that you're going to get paid for what you work, There's definitely a low reward as well because Let's say you get really good at what you do. It's going to take you less and less time each time you do it. So after a while you're going to be receiving less instead of charging more because you have more experience if that makes sense. That being said, it's once again still a great way to charge if you're not sure how long something is going to take you, if it's a new task or if it's a new sort of buy-in, or if it's just a new service altogether and you're just starting out. So how you calculate an hourly rate, I usually recommend my client's chart with how much they want to make in a month. Some people like to start with how much you want to make any year, but I wouldn't go that far. You can go there if you'd like, if that works best for you, if you have a better idea of how much you want to make in a year. But I would say if you're just starting out, you maybe have a better idea of how much it would be good for you to make it a month, to make it worth your time, specially if you're doing this as a side hustle for now. So let's say at the end of the month, you want to make $500 with your side hustle. Now the vitals $500.1 by four weeks because it's easier to think, at least for me, how a baby hours you have available in the set week. So divided 50, 100, 100 divided by four, you would have a $125. So that's how much you would need to make in a week to make that worth of your time. Now, think about it. Your day job, if you have one, How many hours would you have to dedicate to this tide gauge, this new business if yours, if you say, Oh, I want to dedicate ten hours a week, okay, so a 125 divided by 10, you would get $12.5 an hour. In most cases, that may be a really low amount. I personally started at $5 an hour back in the day, but I live in Portugal and I was a student, so the cost of living is lower here. So that was okay with me, but it may not be okay for you. So let's say Okay. But I would really want to make at least twenty-five dollars an hour. Now, you can go two ways about it. You can say, Oh, I'm just going to work hours a week, tracks 25 an hour and still make those a 125 at the end of the week and those $500 at the end of the month or you can be no, I really want to charge. I really want to work ten hours a week. So I'm going to church 25. And instead of making my goal $500 at the end of the month, I'm going to make it a 1000. Sounds great, doesn't it? Obviously, you don't need to have a goal at the end of the month and it's okay if you don't achieve it, it just gives you something to look out for and something to work towards and worked out from. So start with what, how much you want to make it a month divided by 4, divide by how many hours you want to work in a week and then adjust from there. By the way, let me know down in the comments if you have any questions, if you need my advice on maybe you have an idea of how much you want to charge, what you want my input on it. Let me know down in the comments and I'll give you my advice. Now let's get on to lesson number two. 3. Lesson 2 retainer: All right, now less than number 2 are going to be talking all about retainer rates. Now what are good stepping stone from hourly to fixed price packages? I honestly jump straight into fixed price from hourly and then went back to retainer for certain clients and certain tasks. But you can certainly use it as a stepping stone before you jump straight onto packages. Now, with retainer rates, yes, you're still trading time for money, but it's a little bit different. So let's say for this example that you're charging your clients $10 an hour just to make the math easier, if your client needs 20 hours a month from you, they hire you for a 20 hour a month retainer at $200 at the end of the month. If they only give you work to work 15 hours a month, you still get paid those 200 dollars. If they give you 20 hours, you get back those $200 and to give you five, you get paid those $200. So I guess it's safer on a freelancer side because sometimes the coins may not have as much work for you in a month and it's not your fault because you have that time available for them if they need it. So it just makes sure that you know what to count on at the end of the month in a way and you know how you organize your time because if you're just working hourly, what I found sometimes is I was booking out time to work for a certain client and then if they didn't have any work for me, I would be wasting that time when I could be working for another client. So now if I have a client on a retainer Eye Book of that time for them and if they don't have any work for me, lose anything, I'm just going to go for a walk or doing anything else rather than working. So I mean, I guess it's good for me, but if they don't have any work for me, but you get that safety. You're not losing out on money for not having a client that that time and you're not earning less at the end of the month is because the client didn't have anything for you to do. And obviously, like I said, to calculate your retainer rate, It's just simple math. It's the amount of hours the client needs to know your hourly rate. So $10 an hour times 20 hours a month equals $200 for your rotator. Now, like I said, especially for this past year, I've leaving taking clients on a fixed spaces, but I still make some exceptions for a retainer basis. And those are usually when a client needs maybe some admin work on top of their social media package, or they have needs for different tasks on top of their social media package, but they don't exactly know what tasks they would need every month or they change every MAN, I make that exception and sometimes I do the whole package as a retainer. So the social media plus the admin work, which can be a bit confusing and that could be a whole another class in and of itself. They'll usually what we do is we agree, okay. You're paying $500 for your social media package each month and then you get ten hours of admin work on top of that for next year, a $100, let's say obviously I don't work at $10 an hour, but just to make the math easier, Let's say 500 plus a 100. But yeah, Again, like it would be good if the client doesn't have a clear scope or the client doesn't have a fixed idea of what being eager for. Maybe you want to do the first month with them as a retainer and then use the information that you collect during that first month to create a fixed price package that can be good too. And I've done that in the past. You'd like working as a retainer and you want to keep it ongoing, that's up to you. But the point with this class is so I can give you all the information so you can go ahead and make the best decision for yourself. So retainer, to recap, it's kind of a stepping stone from hourly to package rates. It's good if you want to keep it that way because honestly, it has worked best for me because honestly, sometimes that's just the best option if you have several different things that you want to do for your client. And there's not like a common thread that you can pull from to create a package. So with that being said, I'm sorry, the retainer rate was the most complicated one. But let's get onto lesson number three. 4. Lesson 3 package: Now lesson number three is packaged rate. Now this for me is your best option, like I said before, if you have a clear idea of what you're offering, you know, how long it's 800, you know, what goes into it. And you have a real structured service, let's say you offer social media management and you can tell to your clients exactly how many poster getting in a week or a month. And you know, you're getting either engagement or a monthly report and you know exactly everything that goes into that package. If you have a clear idea of what amongst social media work entails, you should do package. Now, obviously there's thousands and thousands of other services you can do a fixed price package on, for example, video editing, logo design, logo animation, web design for literally anything but these are the ones that are closer to what I do. But anything really that has a clear scope and a clear deliverable to your client that you can know. Okay. I'm buying two of them wherever they are and paying $500. In my opinion, if it's that clear, it should be in a fixed price. Now, I personally fought this for the longest time, like I said in the intro, there's like this ongoing battle between hourly and fixed price, which one is vast and everyone seems to have an opinion about it. But I would say is completely random and you really don't know what you expect or it maybe it's the client's first time hiring of Yea or a service provider or it's your first time doing this service for a client? In those cases, Yes. Hourly may be best, but in any other case, it may be worth to look into a package rate. Now, the pros of charging a package rate and my opinion is, you know what to expect both you and your client though, exactly what you're getting, exactly what to expect at the end of the month or at the end of a project, you know how much your work and how much you receiving and the client knows exactly what to budget for. And let's say you are having maybe a bad day. And it's thinking you twice as long as is usual to write a normal social media posts. In my opinion, it wouldn't be fair to the client to pay twice as much just because you weren't as productive that day. Now vice versa, the same applies if you're having a super productive morning and you are able to get twice as much done as you would in a normal day, it wouldn't make sense to thermalize you for that and for you to make half as much as you would on a normal day just because you were more productive. That's a now of course, as long as the quality is the same, It's definitely okay to take half a flaw. In my opinion, this is just fairest way to charge both to you and for your client because both of you know exactly what you expect, you know exactly how much you're working and how much you're getting paid at the end of the month, so you can account for that and the client knows how much they're going to pay you so they can budget and budget that in and their monthly expenses. Not only that, if you're maybe not feeling so well one day and it takes you twice as long to create a post. Let's say it wouldn't necessarily be fair for the client to pay you twice as much just because you were twice the slope. Now on the other. And the same applies if you're feeling super productive one morning and you get double the amount of work done as you would in a normal day, you shouldn't be penalized for getting your job done faster. Of course, as long as you keep up with equality, but it assuming the polity is the same, you shouldn't be penalized for that. Lastly, I would like to point out that to create a package rate, of course, at the end of the day, we need to know how much that packages word. It is really helpful to know your hourly rate. That's what I said in lesson number 1. It's really helpful to start with an hourly rate so you can calculate your packages and have an overall idea. Of course, it doesn't have to be obvious as saying, Oh, this usually takes me ten hours, so let's multiply my hourly rate by 10. It doesn't have to be that straightforward, but it can be, like I also said in lesson number one, it's really useful if you're going to do it package rate, do you know how long it usually takes you to do a certain task? Let's say my example, I have a rough idea of how long it usually takes me to write a social media posts to create the graphics for the schedule it at out, to create a monthly report and everything of that sort. So it's really helpful to know how much you want to earn per hour and how much, how many hours it takes you. But obviously, you can factor in other things like the value you're providing to the client, hourly rate of back client or kinda the value of their time. And you can also even pull in from what other people in your industry are charging. Of course you don't want to copy it and charge the exact same thing for the exact same package because that wouldn't be ethical in the end. Now, while you can factor all of those things in, it's always important to go back to the time that it takes you and factor that in and really think about that because it will also help who not only were pricing, but with organizing your time and your calendar so you can make sure that you have time to cover all of your clients. It would be awful to overbook yourself and then you would either have to work too much or provide less value or drop a client. I would never want that to happen to you or to me or to anyone else. Now that being said, I actually have something for you guys. I created a package rate calculator that you guys can use to calculate your very own packages based on the deliverables and how long it takes you and your hourly rate. So you can use that to calculate your next. Now, let's get onto the outro because I'm going to be talking a little bit more on how you can use the package rate calculator on that outros. So stay tuned. Don't go anywhere. 5. Outro: All right, You made it to the end of this class. Thank you so much for watching now for your actual class project that you are going to be uploading to Skillshare. I would love it if you guys could use that calculator that I gave you to calculate a package for you. Any package will do you don't have to calculate more than 11 is fine. And then after you create your package, you can take a screenshot and add it to the class project so I can see it and everyone else can see it and maybe give their input. As always, if you guys have any questions or if you'd like me to take a look at your packages or anything like that. Please leave those in the comments or like I said, in the class project and I happy to take a look. Be happy to give you my opinion and my and my professional advice. That being said, also, if you have any feedback or any requests for future classes, anything you'd like to see, please also leave those in the comments and I'll make sure to do a class for you. And if you want to learn more about Upwork or Instagram or marketing in general, business in general, don't forget to follow me here on Skillshare so you don't miss out on my next class. I usually upload one class a month, but I'm trying to make those more frequent, but these take a long time. So bear with me while I post one class of fun. I'll see you in the next class. I'm five.