Monday Mindset: How to calculate your “value” and “worth”
My friend Joshua is a magician who makes a living as a keynote speaker at various corporate events around the country – where he blends wisdom, magic, and humor to amaze his audiences. During the early months of the pandemic, Joshua was no longer able to tour when conventions and conferences were canceled. Like many other small business owners and entrepreneurs, Joshus had to pivot and he began offering groups one-hour Zoom magic shows for groups to experience magic and fun from their home.
During the first Christmas of the pandemic, I contacted Joshua to organize a magic show as part of an online Christmas party for friends and family. His fee for the one-hour show was $500. ,
While discussing the fee with a friend, I casually mentioned Joshua’s rate charge. My friend quickly pointed out that we weren’t just paying for that one hour of magic; we were also paying for Joshua’s 20 years of talent, training, and experience leading up to that performance. This insight comes back to me often as I work with entrepreneurs. The question of “how much do I charge?” come up a lot, especially with entrepreneurs who are just starting their business.
Whether you are just starting out or even in you’ve been running your business for a while, developing an effective pricing strategy can be challenging. It’s crucial to charge enough to cover costs and make a profit without overcharging or undervaluing oneself.
So how can you create a pricing strategy that benefits both your customers and your bottom line?
An article from Novo provides valuable insights into pricing strategies worth considering. They emphasize understanding your costs and expenses, calculating fixed and variable costs, and assigning dollar figures to each expense. While these strategies involve spreadsheets and mathematical formulas, let’s not forget to factor in our training, expertise, and unique value proposition to calculate our worth and how much we should charge for our products and services.
Pricing out your products and services is not just a mathematical equation, but an investment back into your self for all your years, experience and expertise. As you wind down 2024 and begin planning out your business for 2025, here are some things to ponder:
- What unique skills, experiences, or expertise do you bring to your business that justify your pricing?
- Have you ever undervalued your services? If so, what led to this and how can you avoid it in the future?
- Are you considering your years of training, education, and experience when setting your prices?
- What unique selling points do you have that differentiate you from competitors, and how can you reflect this in your pricing?
- What steps can you take to build more confidence in the value you provide and your pricing decisions?
Stephanie and I can assist you in working through your pricing and planning for 2025. Simply click through the calendar links below to set up an appointment.
Need to talk about your business or any matters of mindset?
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