How to figure out your pricing for your small business

If you are in the service business, then it might be a little hard to determine the price of your services ad compared to products. Pricing a product is easy as you would have to pile up the manufacturing cost, raw materials cost, and all the other cost.

However, pricing service is somewhat of a hassle as you would have to set the price keeping the profit of the business in mind. While setting the price of the service, there are certain factors that you would have to keep in mind. These factors are intangible and are set based on the kind of service that you offer.

Calculate the Rate per Hour
One of the first ways through which you can calculate the price of the service is to calculate the per hour rate. This can be calculated in further three steps. The first step is to add all the expenses that you, as a business, have done to establish the service. All the direct and indirect costs along with the salaries that you give to the employees, are the expenses.

Then you would have to calculate the rate that you are determining in an hour. Once you find out the rate, you would have to find the profit margin of the service. The profit margin is the extra amount that you derive from selling the service as compared to the hourly rate.

Have a Fixed Rate
One of the things that you could do to is to have a fixed rate for all the services that you provide. To do this, you would have to calculate an average rate, which might be more or less for the different services. However, on average, you would be able to incur a profit margin when the clients avail of different services.

However, this may not always work the way you want to, and you may end up pricing less for a service which requires more work. This is why it is always advisable to fix the price based on work effort given per hour. You put the decided rate on your website, which will be done by professionals who are experts in small business web design.

The Time Given On the Service
This is one factor that should be considered. Performing any service requires time and time should be taken into account when you are fixing the price of the service. Time has a value in the service industry, and this value should be present while deciding the pricing of the service. The more time you have to spend on the service, the higher the price for the service.

Along with the effort and time, the experience of the business should also be considered. The period that the company has spent in the industry is a major criterion of pricing of the service. Companies which are new in the market would have fewer prices for a service that a company with more years in the industry would have.

Web Design City would help your business in setting up the price of your service. Our team of experts would give your guidance and some amazing pricing strategies along with affordable web development, which would be beneficial for your business.