Before I jump into the questions, I want to explain why I started asking myself these questions.
First, I find myself a lot more comfortable and confident with my pricing when I can back up the numbers. I used to pick a number based solely on what I needed to survive, which isn’t necessarily bad, it just felt a little too me-focused. This process allows me to explain my pricing with more confidence.
Second, this process of asking myself these questions, allow me the freedom to raise my prices more significantly than I might have done previously. When I have the hard facts in front of me, it doesn’t feel greedy to raise my prices, it feels justified.
If any of that resonates with you, I think these questions will really help you get confident in your pricing.
1. Have I tracked my time lately?
The very first thing you should take into consideration when raising your prices is the time you put into your project.
Note: I don’t think your pricing should be solely based on your time. The more expertise you have, typically the less time it takes you to complete a project. Clearly you shouldn’t make less for being efficient or having more experience. However, I do believe people tend to underestimate their time and your time is a great starting point for the bare minimum you should ever be paying yourself.
Track your time
There are plenty of aspects to working with clients, here is roughly what I do from project start to finish.
Phone call to discuss details
Define scope of the project
Add to Asana
Send client homework
Finalize and send files
Tutorials (if applicable)
Ask for a review
Write blog post featuring project
Create graphics for blog post
Promote blog post
People tend to only track the time for the Design Process category, but that would be leaving out a lot of the things you do in order to work with your client. A lot of these things, if done successfully, can be automated but it will still require you the time to create that automation. Etc. etc.
The point is track everything.
Tools to track your time
There are countless great tools out there that can help you track your time. A few of them are:
2. Have I updated my process recently?
I am notorious for switching things up in my business the second I notice a better way of operating.
This may be a good thing or a bad thing, it’s hard to say.
But, because I adapt my process so frequently and without much thought. In the past I have made significant changes that have greatly improved my design packages without ever thinking to raise my prices.
When you are ready to raise your prices, take a look at your process. Ask yourself, how has it changed since the last time you raised your prices? Have you simplified anything for your clients? Are you offering more resources or support to your clients?
If you have made these updates, take that into consideration when updating your pricing.
3. What improvements have I made that benefit my clients?
That leads me to number three, what additional benefits are your clients receiving from you now verse the last time your raised your prices?
Have you improved your skills? Expanded your knowledge? Eased a pain point for your clients? What can the client walk away with now, that they weren’t able to before?
This could be big benefits or relatively minor. Here are a few to think about:
Additional guidelines or resources offered to your clients
Expanded the package you offer
Improved the clients user-experience
Implemented tools (like a CRM) that benefit the client
Provide additional long-term support
The takeaways for your clients are some of the best ways you can verify your price point. The tangibles go a long way.
Are you ready to set goals you can actually reach?
4. Am I properly covering my taxes and business expenses?
On a completely different note, the two remaining questions are separate from your clients. These will help you set a general baseline for your service point.
First, you need to be able to cover your taxes. This isn’t something I’m going to pretend to be able to give much advice on. I recommend checking out QuickBooks.
Next, you need to be able to cover your business expenses. In order to do that, you need to make a list of what your business expenses are.
Office + Business Supplies
Software(s) + Equipment
Subscriptions Services + Tools
Marketing + Promotions
Education + Courses
Write everything you can think of and take a few months to track it all, especially if any of the expenses ebb and flow.
5. When was the last time I raised my prices?
This isn’t something I started tracking until recently. I never really thought this information would be beneficial, but I think it’s important to keep tabs on how frequently you’re raising prices (or not raising prices).
Now, there are a lot of supposed methods and formulas for how frequently you should or shouldn’t be raising your prices.
Some say every 3 months, some say no more frequently than every 3 years. I think this is a personal decision that no one formula can guide you on.
Here’s my general rule of thumb: if you’re feeling undervalued, irritated and you’re wondering when the last time you’ve raised your prices was, it’s time to raise your prices.
What are the requirements you have for raising your prices? Share them below!