Spreading the Transforming Power of Improvisation

How much to charge??

I'm putting together an AI business (at last!) and one of the first pices of work will probably come from a friend who heads up the financial services division of a very large retailer. The idea came from an evening in a bar when I told her my passion and she told me that her team needed some of this work.
Now that I'm in the position of doing this for an income I'm trying to guage pricing.
I'd love to hear from some of the more experienced people of how they deicde on thier pricing strategies.
I'm not asking for your price books (although they would be very useful to hear) but some guide about how you go about coming up with a price.
thanks All
Alan

Tags: pricing

▶ Reply to This

Replies to This Discussion

Permalink Reply by Ed Reggi on January 12, 2009 at 12:11pm: Alan -

Tackling pricing can be compared to cooking with the spice ginger. Your guests should never eat the pastry, or meal and say, "Ahhh Ginger!" I believe this is true about pricing a project. You should not use broad sweeping rules when quoting a project, I prefer to do my research and see how much "ginger" I can use before they will make a face.

For example, I just quoted a price for an organization located in a small rural community in the Midwest. The company on paper seemed to be taking a fairly big risk by thinking of my workshops but I also knew they were referred to me from a former client of mine. So I knew they were hooked from the referral. After I quoted them my price (which was my not-for-profit lower than for-profit price) the HR person said, "Oh no problem with those fees. We recently had a donor give us one million dollars and we are looking to use it to improve our services."

I should of added more ginger!; ▶ Reply to This

Permalink Reply by Viv McWaters on January 8, 2009 at 1:09am: HI there Alan

Good luck with the new venture. I've found doing pricing for friends problematic (not sure why - maybe a conversation for next time we're in a bar together ;-) Also, there's a tendency here (not sure about the US) to price too low. Start high. You can always come down but if they accept your pricing without batting an eyelid, you know it was too low! Skype if you want to chat.
Cheers
Viv; ▶ Reply to This