Are you trying to come up with the right figure to price your social media consulting services? Not sure if you are charging too much or too little?
Well we have a few formulas for you that can help.
And Phyllis and I talked about these formulas in our recent SocialTalkLIVE show which was a lot of fun! Watch here:
So I thought I’d take a different approach with some of the things I highlight in this post:
#1 Billable Hours
If you come from the mindset of a 40 hour work week and a steady paycheck, then this is a shift. When I first started working for myself, I thought that a reasonable rate for consulting would be my old hourly rate as a salaried employee and then just bump it up a small percentage for overhead.
But what you forget to realize is all the time it takes to market your business, do administration, and keep up with the latest marketing techniques – especially in social media. So you really only have about 1/2 of the day for one-on-one consulting time.
If you are doing project work, you may be able to fit more of that in than one-on-one consulting or you can also do that at different times of the day – hopefully not too late at night though.
I usually suggest starting somewhere between $35-50/hour depending on experience for social media consultants as a one-on-one rate.
This can depend on region (and of course different countries are much different) and sometimes niche.
Overhead doesn’t only mean your printer paper and your laptop. You also have to factor in things like taxes, health coverage, savings, and team members if you have people helping you out.
I started my business very lean, keeping my expenses at under $300/month for things like web services, tools I used, and courses I invested in to further my training.
That is one thing I love about this business is that it can really grow with you and you can ramp it up slowly or more quickly if you need to replace an income.
Once you start earning more income, you need to make sure you are either having taxes removed automatically or paying them regularly to make things easier.
Usually you should factor at least 30% in total overhead costs, sometimes more.
#3 Packages You Offer
Putting together your pricing on what each of your services costs is a good idea because you won’t spend too much time on quotes. Know what your rate is for writing 10 tweets and then if you have to write 100 tweets you can easily put that in a quote.
In our Social Media Manager School course we offer a variety of templates that will help you quote your services quicker.
Your project rate will be different because you can do things like outsource some of the project to someone on on your team, or do the work at different times of the day, and also get more efficient at doing the work (effectively giving yourself a raise).
Your client doesn’t have to (and maybe shouldn’t) know what your project rate is – it is for you to use internally to figure out a quote for a project or a monthly retainer.
Again, the Pricing Guide gives you all the details on how to figure out these numbers so go pick up your copy.