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Topic: Student Questions
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This question has been answered, and points have been awarded.
How To Charge Services For New Marketing Business.
Posted by Anonymous on
11/27/2009 at 2:08 PM ET
I am preparing to start my own marketing business and am not sure what to charge for my services. I will provide print advertising services (I am experienced in Photoshop, Illustrator and InDesign), radio advertising and video/commercial advertising. Since I will be a sole propieter, I will be responsible for finances accrued through my business and I am not sure how much I should charge to cover the cost of the service while accruing a profit and covering tax expenses.
11/27/2009 at 8:12 PM
It would probably be a good idea to do some business, financial and marketing planning before you go any farther. How much revenue do you need to generate to pay the bills? How much are you prepared to invest to create awareness and generate leads for your business? How long will the sales cycle need to be before you can expect to close some sales for the kinds of services you'll offer?
My approach to pricing your services would be to consider each assignment on its own. Determine how much time you'll need to put in on it, and then decide what the project is worth to your client. That's the price you should charge. Of course if the price you need to charge is greater than what it's worth to the client, you probably won't get the job, but that's OK. You don't want it if you can't cover your costs and make a fair profit on it, right?
I think it's unreasonable to expect (or ask for) retainers right off the bat, and billing by the hour or the day is a fast way to lose clients and put yourself out of business.
What you need to do is price by the project, and be sure you understand what the project will entail before you quote a price. As long as you charge less than what the project is worth to the client, you should be OK.
You may want to check out
Rasputin For Hire
. The subtitle of the book is
An inside look at management consulting between jobs or as a second career
, and the book has several important lessons for new consultants and marketing service providers -- including several pages on the various pricing options for marketing consultants and service providers, and the pros and cons of each approach.
If you order using
you'll also receive a free bonus report that contains a round-table discussion with five of the experts from right here on the MarketingProfs Know-How Exchange. They discuss the lessons they learned in consulting -- including how they price their own services to prospective clients, some of the mistakes they've made, and specific advice for new consultants and marketing service providers. (You can also order just the special report, if that's all you want.)
11/27/2009 at 9:31 PM
Write a business plan. I'm as serious as I can be. You need to see everything in writing, for yourself. You must know these before you hang out your shingle.
If you look at business plan templates, you can see what type of information you will need. There are competitors out there that literally can tear your heart out because they know the marketplace, and you do not.
Many of us rewrite our business plans and marketing strategies every year or every two years, because the market changes so rapidly. And, if we must do it...so must your clients...and, you will need to assist them with these tasks.
Sure, creating a website is fun and challenging. Sure going into production and V/O a spot for radio/TV is also fun and challenging. I've been doing it for 37 years, and every year is a new challenge.
mgoodman is a highly experienced marketing professional, as are many here, and I do not believe many will disagree with what I am telling you.
You are a long way from thinking about pricing...a long way.
Please, take all of the advice you are given and think through it...
White Mountain Marketing
Houston (The REAL), Texas
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