I’ve been asked A LOT about how to charge for your services as a solo consultant or coach and since I’m removing myself from this niche soon, here it is – it’s simple:
Take your revenue goal for the year and divide it by the number of average hours you work per year.
This will give you what every “working” hour should be worth to you if you worked 40 hours per week.
This is where consultants screw this up.
We are NOT productive humans at all.
Productive hours are completely different. Many studies have been done to prove even fortune 500 CEO’s barely get truly productive time in every day.
You are really only truly productive 1/4 of the time if that. So here’s the formula with an example:
Revenue goal: 300,000/year
40 hours/week = 1920
300,000 / 1920 = $156.25 per hour x 4 = $625
$625/hour will be how you determine how much you charge for assignments, projects, speaking engagements etc…
Every time you let someone waste 15 minutes of your time, you just lost $156… for every 15 minutes lost, you are $156 behind your income goal for the year.
If your new hourly rate is $625, and a project will take you 20 hours, you can confidently charge $12,500 for it and take on all the projects you want knowing you will comfortably hit your goal.
I’d personally add in a 15-20% buffer to the fee, and never tell the client how you arrive at your fees. This is for you to know only. This is just for personal calculation.
P.S. Notice how this calculation had nothing to do with the competition, market, or similar products?
That’s because all of that is irrelevant.
You determine your own prices.