This one is all about the Money Honey.
Money is weird. You make it, you lose it, you gain it. You need it, can’t live without it, etc.
But when you’re just starting out in your business, one of the first things you need to know is how to price your offers.
I am not my ideal client.
When I first started shooting weddings, I thought $400 was a reasonable amount to pay for a wedding photographer because I couldn’t imagine paying more than that for one myself.
Umm… $400 was barely going to cover my car insurance.
This tactic will hold you back and keep you at prices far lower than what you should be charging.
Market-based pricing is essentially the theory that you should charge what other people in your industry (at your level) are charging.
There’s a big problem with this! You have no idea what someone else’s expenses are. You don’t know their cost of living or bills.
You’ve got to know your numbers.
Before you set your prices, answer these questions:
And listen, you’ve got to get over any limiting beliefs or self-doubt that pops up when you’re going through these. Be honest and vulnerable in your answers.
To understand the cost of your business (not anyone else’s), answer these questions:
Don’t start a new business when you’ve got a bunch of debt. It’s just not a good idea!
You want the freedom to start something new, and debt is a major burden.
I’ve done the math, and all things considered, shooting a wedding takes me between 30-60 hours. That includes emails, phone calls, planning, drive time, actually shooting the wedding, editing, and delivery.
To set your prices, look at the number of weddings you plan to book for a year. Let’s say that’s 25.
50 hours x 25 weddings = 1250 hours
You set your hourly rate based on your expenses, which comes out to $50 an hour.
1250 hours (the hours you’ll work on the weddings you plan to book) x $50 an hour = $62,500 for your yearly salary
So when setting your package prices, you can use these numbers to set package prices that will allow you to reach your salary goal.
You would price your basic wedding package at $2,500 in order to help you make your goal.
Once you’ve set prices that make sense for your business, given your unique goals, expenses, and situation… you’re in control.
You’ll know how much money you’re bringing in, how close you are to hitting your goals, and where you’re losing money.
Having this knowledge will help you make smarter, better decisions and will ultimately help your business flourish!