A quick query: How much do you charge for product reviews? I am a virtual vet. I also have a blog, posting every day. This is becoming a larger part of my workload, but I do it for free, which is a challenge. Part of my mix is a weekly product review, which I have done for free up till now. A PR company told me that one of the reasons that they use me is that I am free whereas people like you charge a fee. So hence my question: How much do you charge?
I’m a relatively new wedding photographer and struggling with setting my rates. I know I’m cheap (a lot cheaper than most other photographers I’ve looked at) but I feel that my prices are justified because I’m still in my first year of business and I have a lot to learn. I guess my question is really this – how do I know when I’m good enough to charge more and how do I get from where I am now to where everyone else seems to be?
I get a lot emails from people asking me these kinds of questions so let me start by being completely honest – when it comes to how much you should charge I really have no idea.
There are so many factors that need to be considered when setting your rates, and as an outsider I can’t examine any of them. What I can do for you though is point you in the right direction for figuring this all out for yourself.
Finding your pricing sweet spot should depend on a variety of elements, all of them very specific to you and your business. There are a number of things you need to look at:
1. How much time the job will take you – time is money and all that. It might be easier to think in an hourly rate, i.e. the longer and more complex the job, the more you should be paid.
2. How much doing this job will cost you - in expenses such as travel, kit or outsourcing anything. These obviously need to be covered by whatever you charge.
3. How many paid jobs you want to do per week/month/year - so you know how much you need to get paid, per job, to reach whatever salary you want to earn.
4. How much you need to earn, per job, to make a profit - because, after all, you hopefully want to make one. Make sure you add a little bit extra on your fee to get there!
5. How much it costs you to run your business - knowing this will help you figure out how much you need to earn for your business to be profitable. Taking all of the above into account as well of course.
6. Your experience - the more of it you have, the more you can charge. In the vet’s case, you also need to consider the traffic and reach of your blog. What kind of results can you give people who pay to be reviewed on your site? The more traffic your site has, the more you can command per article. How many products will the companies you feature need to sell off the back of your review for them to be happy about what they paid? For example, if you charge £200 for a review, a dog biscuit company might have to sell 40 packets of biscuits at £5 each to break even.
7. What you think you’re worth – how much do you think each job is worth? Would you be happy to do the task for £100? £500? £1000? £10,000?
8. What people are willing to pay you – it’s all very well and good quoting someone £10,000 for a job, but will they actually be willing to pay that?!
It can feel very overwhelming to think about all these things, but if you don’t you’ll just be plucking a random number from the sky and hoping for the best. That is not a very smart way to run a business.
A lot of people (appear) to set their rates by just looking at what everybody else is charging. And while it’s true, you do need to consider the market that you’re in, by always valuing yourself and your offerings against other people, you’ll constantly be measuring your worth by comparing yourself to them.
The way I set my own rates was simple, if not rather naive (full disclosure: I did not do all of the above, but if I was in your position now, I would). I started out being really cheap, and in many cases working for free, and then slowly increased my rates as my experience grew, the level of service and results I could offer increased, and the demand outstripped the amount of work I could supply.
You, and only you, can decide what’s best for your business and how much you should charge. However I’ll give you this for free: Starting out by being ‘cheap’ and getting busy with as much work as possible is a great way to grow. Having lots of work in your portfolio, an army of past clients raving about you, and getting a truckload of experience is, in my eyes, always the very best way to begin.
For more information on setting your rates, check out The Blogcademy Home School module on the subject.