How Much Should I Charge for My Services?

Regardless of entity status, creating a financially sustainable organization relies heavily on an organization’s pricing model. This guide provides a step-by-step walkthrough for determining a pricing structure for your services. By the end of this guide, you will have a solid understanding of how to price your services in a way that is beneficial for both your organization and your partners.

1. Determine the costs of providing the service: This includes direct costs such as materials, labor, and overhead as well as indirect costs such as marketing and administrative expenses. You want to make sure you are covering the full amount for providing your services.
2. Research the competition: Everyone has competition. It’s important to research what similar services are being offered in the market and at what prices.
3. Consider the value of your service: Take into account the unique features or benefits of your service and how they compare to those of your competitors.
4. Determine your target market: Identify the specific group of customers you want to reach and consider their willingness to pay for your service. Is your customer different from your end-user?
5. Choose a pricing method: There are several pricing methods to choose from (i.e. cost-plus pricing, value-based pricing, and competition-based pricing). Which pricing method fits your organizational needs best?
6. Set a price: Using the information gathered from the previous steps, set a price for your service.
7. Test and adjust: Once you have set a price, it’s a good idea to test it with a small group of customers and gather feedback. Based on this feedback, make adjustments as necessary.
8. Communicate your pricing: Make sure that your pricing structure is clearly communicated to your customers. You can include this information on your website or in your proposal.