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How do I price services as a small business?

I am a college student going into her sophomore year. I've decided to rebrand the graphic design business I started in high school. I left it alone for a bit to focus on school. I'm having a bit of an issue with pricing. I've made and have been paid to do people's logos before but I want to offer more than just logo making.

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Eric’s Answer

Kharri,
First, I want to commend you for articulating your question clearly and concisely. Writing is an important tool of communication in all aspects of business. In regards to pricing services, many service-based businesses bill based on hourly rates and they bill about 3 times the hourly wage that a given employee is paid. That is, if the services provided require 4 hours of a graphic designer's work and that employee makes $25 per hour, the billing rate that the employer will charge the client is about $75 per hour for a total of $300. As a freelancer, your rate should be somewhere between the going hourly wage of a graphic designer and the billing rate so that you are more competitive than a full-service company but are able to cover the costs of having your own business. You might consider something closer to 2 times the average hourly wage, depending on your experience level. You can still agree to a flat fee provided you have a good idea of how many hours a given project will take you to complete.
All the best in your business,
Eric
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Shantel’s Answer

Services as a graphic designer small business can be difficult to price. There are a few things you need to consider when pricing your services. The first is the time it will take you to complete the project. The second is the cost of materials. The third is your overhead costs. The fourth is your profit margin.

The first thing you need to do is determine how much time it will take you to complete the project. This includes the time it will take you to consult with the client, create the design, and make any revisions. You will need to factor in your own hourly rate when determining the price.

The second thing to consider is the cost of materials. This includes the cost of paper, ink, and any other supplies you will need to complete the project. You will need to factor in the cost of shipping if you will be shipping the finished project to the client.

The third thing to consider is your overhead costs. This includes the cost of your office space, equipment, and any other costs associated with running your business. You will need to factor in your overhead costs when determining your price.

The fourth thing to consider is your profit margin. This is the amount of money you want to make on the project. You will need to factor in your overhead costs and your desired profit margin when determining your price.

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Dershawn’s Answer

Hi Kharri
Congrats on taking your future into your own hands and starting your own business!
My Advice for you is to start a business plan. It will help you develop your brand and see who your target market is so that you can see the needs of the clients you want to focus on and also to research your competition. This will surely direct you to get all the answers you need to be successful.

I wish you the best!!
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Venola’s Answer

Great question! The best place to start is to research what other companies are charging for the same or similar product or service. This will give you an idea of what customers are willing to pay. Then determine if the value your product or service falls on the low, middle, or high end of that range. You should also think about the cost of production and try to get that down to a per unit cost. This will help you evaluate if the price you came up with will put you in a profitable situation.
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