How to Price solopreneur services
Pricing is consistently a big issue in the small business world. It makes sense — there are a lot of emotions and logistics involved with pricing. Everything from “Am I good enough to charge that?” to “What do I do if my prospect can’t afford that?” comes into play.
But we’ve found it’s best to remember that money doesn’t have feelings. People do.
So let’s try to stick to logic when developing our pricing, shall we?
Here’s how we originally developed our pricing for Bigmouth Copy, back when it was just a team of one. But first, three caveats:
This model is for service-based businesses. Sorry, product friends.
This is just a starting point. You can absolutely change these numbers over time, and raise them beyond.
We are not finance professionals or law professionals, so don’t take this as financial or legal advice.
Pricing Structure Formula
Our original, solopreneur pricing formula starts with the salary you’d like to personally take home each year as the business owner. Then plug that into this formula:
Salary x 2 = Amount you need to sell this year
Total sales $ / 12 = how much you need to bring in each month
$ you need to bring in each month / # of projects you can take on per month = pricing per project
Why do we multiple the salary you’d like to earn by two? Because not all of the money your business takes in belongs to you. Some of it belongs to the government in the form of taxes, and some of it belongs to the business to pay for expenses.
Pricing Structure Example
It’s time to apply that formula in real life. Let’s pretend that you‘re a wedding photographer who wants to make $75,000 in salary and shoot 3 weddings per month. To calculate your pricing, you would:
$75,000 x 2 = $150,000 you need to sell each year
$150,000 / 12 = $12,500 you need to sell each month
$12,500 / 3 = $4,166.66 you need to charge for each wedding photography gig
Once you know the goal salary you want to make, and you're charging the appropriate prices, then you can plan on paying yourself. To calculate your salary, take your total salary goal for the year and divide it by 12 months. In this example, $75,000 / 12 = $6,250 per month.