One of the biggest mistakes new business owners make is pricing based on fear instead of facts. You don’t want to scare clients away, but you also don’t want to work hard and make little profit. The goal is simple: charge a price that covers your costs, pays you fairly, and leaves room for growth.
1. Know Your Real Costs First
Before setting any price, calculate what it actually costs to deliver your service. Include:
Your time (or staff wages)
Transport or travel expenses
Products and materials
Equipment wear and replacement
Taxes and business expenses
If you don’t include these, you’ll automatically undercharge.
2. Pay Yourself Properly
Many beginners forget this step. Your price must include your wage, not just business costs. If you want to earn £15 per hour, that must be built into your pricing from the start.
3. Add Profit — Not Just Break-Even
Break-even pricing keeps you busy but broke. Always add a profit margin (typically 20–40% depending on your industry). Profit allows you to grow, reinvest, and handle unexpected expenses.
4. Research the Market — But Don’t Copy
Look at competitors to understand the price range in your area, but don’t assume the cheapest option wins. Clients often choose reliability and quality over the lowest price.
5. Start Slightly Higher Than Your Comfort Zone
If your price feels a little uncomfortable, you’re probably closer to the right number. Underpricing is much harder to fix later than starting correctly.
6. Review and Adjust Quickly
Your first few jobs are data. Track how long work takes and whether you made profit. If not, adjust immediately — not months later.
Final Thought
Pricing is not permanent. It’s a decision you refine with experience. The most important thing is to start from a position of value, not fear.
If you’re unsure about your pricing, review your last job and calculate your true hourly profit and you might be surprised.
