First Client Pricing - The Formula That Removes Guesswork š„
Charged $400 for first project. Should have charged $2,000. Here is the formula I use now. THE PRICING FORMULA: Step 1: Ask how many hours they spend on the task weekly Step 2: Multiply by their hourly cost (or estimate $30-50 for staff) Step 3: Multiply by 52 weeks = Annual cost Step 4: Charge 10-20% of annual savings as setup fee THE EXAMPLE: Prospect: "We spend about 10 hours weekly on invoice entry." Their hourly cost: $35/hour Annual cost: 10 hours Ć $35 Ć 52 = $18,200 My fee: $1,820 setup (10% of annual savings) Monthly: $150 (covers monitoring and support) THE CONVERSATION: "You're spending $18,200 annually on this task. My setup fee is $1,800 with $150 monthly. You save $16,000 in year one alone. The system pays for itself in the first 6 weeks." THE PRICING TIERS: STARTER (First 3 clients): Setup: $500 - $1,500 Monthly: $100 - $200 Why lower: Building portfolio and testimonials CONFIDENT (After 3 clients): Setup: $1,500 - $3,000 Monthly: $150 - $300 Why: You have proof and confidence SPECIALIST (After 10+ clients): Setup: $3,000 - $5,000 Monthly: $300 - $500 Why: Niche expertise commands premium THE PSYCHOLOGY: Never say: "I charge $50/hour" Always say: "The investment is $1,800" Hourly = Commodity Project-based = Solution THE RULES: Rule 1: Never charge less than $500 for setup (signals professional) Rule 2: Always include monthly retainer (recurring revenue) Rule 3: Quote based on their value, not your time Rule 4: If they say yes immediately, you priced too low š More templates in Github What is the annual cost of your prospect's manual process?