Fee structures vary greatly depending on the type of work you do and where you are located. Setting an appropriate fee structure and increase strategy is necessary in any business. No matter which method you choose for determining your rates, be certain your fee structure promotes credibility.
Four major fee-setting strategies
1) High-end rate
Set your rate significantly higher than the standard rate* to target a small percentage of the population. This works best if your service is innovative, is in demand and has no competition, or has significant value added to the basic service.
* The standard rate varies greatly by location. To determine the standard rate in your area, check with schools, look at ads and do surveys.
2) Industry standard rate
Determine the standard rate and align with it.
3) Low-end rate
Set your rate significantly lower than the standard rate to attract a larger market share.
4) Time-limited introductory rate
Offer introductory rates for a limited time or package deals reflecting reduced rates. Beware of the tendency to overextend introductory rates.
Carefully consider all of the costs involved in running your business before you finalize your fee structure. Take into account your fixed costs, such as rent, utilities, phone, equipment, loan payments, maintenance, insurance, licenses and promotion, as well as the amenities that vary depending on the number and type of clients (e.g., providing free samples and educational materials, taxes and supplies). Then there's your time: keeping client records, networking, planning, extended business hours, traveling, practice management, continuing your education and client follow-up.