The following is the sixth in a 12-part series by Fairfield County Venture Mom Holly Hurd. If you have articles you would like to submit, send them to [email protected].
Week Six Pricing
On to Week Six, and I hope you are getting excited about your venture. This week, we are going to cover pricing. Many moms can be shy about asking to get paid for their product or service. Your goal this week is to come up with a pricing plan, draft it in clear wording and work on being open about it.
First, do some research. Pricing a product is a bit easier than a service but you want to be competitive and make sure clients feel they are getting a good value.
What do others charge for your service? If you are offering to be a personal shopper for clients and your competitors charge $75 an hour, you don't want to price yourself at $250 an hour unless you can show you are worth it. If you are just starting, I would recommend pricing under your competition and offering an opening freebie.
For example, a way to entice people to try you and to build a relationship is to offer an assessment. In this example, you might offer a free hour of wardrobe consulting. This might consist of having the client fill out a questionnaire that tells you what they have in their closet and what they need in terms of clothing. You would then have an hour by phone or in-person meeting. This is where you would discuss their needs, let them know how you can help them, how you work with most clients and most important, what you charge.
The most uncomfortable moment can be when you complete a job and ask to be paid and the client says they thought that was the free part. You might send an invoice up front and even get a deposit. In this case, where you are a clothing consultant, after the free assessment, and when the client hires you to help her get several outfits for her new job, you would prep an invoice asking for a 50 percent deposit.
Also, be clear about your minimum number of hours. Then outline descriptively in the invoice what you are providing. For example, "ABC Clothing Consultants will spend at least two hours shopping with you at the Westchester Mall on a mutually decided date. Additional hours will be billed accordingly." Or if you are providing family meals you might say in your marketing, "Each meal consists of a main course, two side dishes and bread to serve five, and will be delivered by 5 p.m. on the designated day. Cost is $65. Payment is expected at time of delivery."
Debbie Fay, my fabulous friend, VentureMom.com guest author, and a wonderful speech coach who several VentureMoms have used, charges an hourly rate and has a two-hour minimum. She emails clients an invoice they have it for their records, know where to send payment and Debbie can keep her accounting up to date.
So get started on pricing your service or product and draft the details for use in your marketing materials which we will begin work on next week. Visit VentureMom.com for more info.
Holly Hurd, [email protected]
How do you go about determining your prices for your venture? Tell us in the comments below.
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