When I first started my business this was honestly the hardest part. There is so much information especially on social media management and the price ranges are crazy. For example, the hourly rate for a social media manager is anywhere from $25-$100 CAD p/h with the sweet spot being $55. Unfortunately for most service providers this is a common problem to come across, what should you charge for your services especially when just starting out?
Socially Kailee Guide to Packaging Your Services
1. Key Questions
Before you do anything there are some important questions you need to ask yourself to see where your business stands:
-how much time do you have? Is this going to be your full time business and sole source of income?
-Is this going to be a side hustle to get extra cash?
-Are you doing this solo? Or do you have a team to take on more work?
-Passive income or Active income? Is this going to be something you do regularly or do you want to put in work up front and make money passively?
-Realistically how much experience do you have and what are your notable skills? You can’t be a fresh service provider with no prior experience and expect to charge a top tier rate like $100 an hour.
2. Research
A quick google search on “What should I charge to be a _____” is a starting point, but usually offers a WIDE range and certain circumstances that maybe don’t apply to you. As a service provider I highly recommend asking in industry groups in your niche (FB is great for this), reading blog posts, checking other service providers’ packages, and compiling a document with package examples and experience levels.
3. Hourly or Packaged Rates
This really depends on the service industry you’re entering, but for this example I’m going to use Social Media Management/Virtual Assistance. When you start out most people recommend getting some experience under your belt at an hourly rate. Again refer to your research to decide what that should be. When I first started as a VA my hourly rate was $25 CAD an hour. Once you have put in at least some experience I highly suggest switching to monthly packages.
4. Calculating Package Prices
Monthly packages secure steady work and allow you to create your own schedule. There’s 2 ways you can curate your monthly package rate (going based on your hourly rate and calculating hours for the month ie. 10 hrs a month x $30 an hour = $300 package per month OR Value based). For example, a graphic designer or Video editor might not charge based on an hourly rate, but on a Flat project fee OR package! For my packages I implement both. Certain elements of the package like content creation, copywriting, and photography are listed under a base fee, but daily engagement, reports etc. are based on my hourly rate calculated into a package.
5. Should You List Your Prices?
There are mixed feelings about this and here’s my take – I originally listed my prices, thinking it was easier for potential clients…BUT after being in business I realized the downsides to this. It’s better to disclose prices after a discovery call, you can learn more about your potential client, if they are a good fit and create custom packages! Not only that if you start at a low rate and down the line need to adjust your prices it looks less suspicious to prospects ie. “How come this package was $300 now it’s $500!”. Down the line you may find what is and is NOT working for your business and therefore change what you are offering or add new services etc. Not listing your prices offers a more flexible way to scale your business. You could advertise prices once you are well established and set on your packages.
6. High Ticket vs. Low Ticket
Packages are often categorized into High ticket vs. Low Ticket. High ticket means higher priced premium clients. The goal is to carry fewer clients with higher priced packages. This may mean a really decked out package with premium features, more access to you personally (1:1) for support/questions, or secret access to things like private fb groups etc. It’s good to offer both high and lower ticket packages so you can reach more clients with varying needs (at first).
7. Portfolio and Social Proof
Choosing to go with higher ticket packages or a higher starting rate needs to be backed with evidence. You should have ample testimonials and social proof to back what you are selling. Maybe that means screenshots of analytics, positive client feedback, or Good ROI data you have accumulated. If you are offering a creative based service (graphic design, videography, photography etc.) You should have a portfolio, website or reel available to demonstrate your project capabilities.
8. Taxes and Added Fees
As a Canadian freelancer or sole-proprietorship you do not have to tax or register your business until you are making $30,000 income from that business. You cannot tax a client until you have a registered HST number (done thru the CRA website). I’ll do a separate blog post on Registering your business in Canada! If you have an HST number remember to include your number on your invoices and create your prices accordingly!
For payments the main goal is that you get paid, so you should have flexible options for accepting payments (ie. cash, cheque, e-transfer, credit etc.) If you are using a payment gateway like stripe or Paypal, note that there are added fees (around 3%). You can decide if you want to have an added fee to make up for that 3% or just table it. I personally let my clients know that E-transfer is my preferred method but am willing to discuss should they need to use cards/credit (in which I use Stripe and have chosen not to add a 3% fee).
9. Dive in
You may have all your packages and prices set from the get go, but there is no shame in adjusting or offering new services once you get more experience or learn new skills along the way. After the few months of running my SMM business I learned which service features I really don’t enjoy providing, and new package ideas that align better with my clients’ needs. You can find an example of my packaged services HERE
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