Service Based Companies

[Buck Slayer]

Hey everybody, this question is mostly for small business owners providing a service of some sort, but anyone with some insight please feel free to chime in.

So I just started my own company and I've been trying to do some research on pricing. What process do you go through when coming up with a pricing scheme? I can't seem to find definitive answers on the internet. I don't want to be pricing myself out of jobs, but at the same time don't want to be leaving money on the table. Finding that fine line seems to be tricky.

Anyways, any advice, tips or insight are greatly appreciated! Thanks.

-James

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[Buckshot4900]

If you are good at what you do then you should have an idea about how much time it will take on a certain job.
Figure your time at what you feel is a fair hourly price, add in all materials needed to complete the job and add at least 30%.


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[Pstraw]

Any tools/equipment should be figured just as if you had to rent them. Don't forget milage and upkeep on vehicles. Insurance?

[3rdCoastHunter]

Yep it’s a simple job cost comparison :
Factor in total job cost - labor materials etc
Variable costs - FJB gas costs
Taxes
Inflation
Local neighborhood mob boss wants a cut
Wife prolly wants a lil

Anddddddd you’re working for free. Enjoy the service industry.

[dosrobles]

100% depends on what you’re doing. I own a small engineering company and we have variant rates for things. If it’s an ongoing contract we use material cost x 4. If it’s purely consulting we charge hourly. If your janitorial (no idea what you are) material x 4 puts you in the poor house, but $250.00/hr prices you out.

[Buck Slayer]

For a little insight, it is a pressure washing & surface cleaning company, I am the only employee right now, but I am setting everything up and trying to do the right things with planned success in the future. Somebody once told me to set the company up as if I was preparing to sell it. I have not fully figured out that proverb yet, nor do I plan on ever selling anything, but what I do know is I want things done right and I have a vision.

Obviously with me being the only employee, I am only able to do this on weekends or an evening as I still have my 9-5. This is only for the time being though, as I am driven to make it a successful company and have set some goals that I find achievable through grit and drive.

I guess what I'm trying to say is in the present moment this just has "side gig" curb appeal; that is not how I am setting it up though from a business perspective nor do I carry that demeanor.

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[kparker158]

For a little insight, it is a pressure washing & surface cleaning company, I am the only employee right now, but I am setting everything up and trying to do the right things with planned success in the future. Somebody once told me to set the company up as if I was preparing to sell it. I have not fully figured out that proverb yet, nor do I plan on ever selling anything, but what I do know is I want things done right and I have a vision.

Obviously with me being the only employee, I am only able to do this on weekends or an evening as I still have my 9-5. This is only for the time being though, as I am driven to make it a successful company and have set some goals that I find achievable through grit and drive.

I guess what I'm trying to say is in the present moment this just has "side gig" curb appeal; that is not how I am setting it up though from a business perspective nor do I carry that demeanor.

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Read/Listen to The Pumpkin Plan book. It’s game changing.

[eradicator]

So you really haven't started a business yet. Sounds like you are winging it. Just do comps for comparable companies as a starting point. Do you have a lot of experience using a pressure washer?

[Buck Slayer]

Read/Listen to The Pumpkin Plan book. It’s game changing.

Thank you, I will look in to it

So you really haven't started a business yet. Sounds like you are winging it. Just do comps for comparable companies as a starting point. Do you have a lot of experience using a pressure washer?

No, false. I own a company. I'm curious as to what your definition of "winging it" is?

[Buck Slayer]

Bump

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[jason86]

For a little insight, it is a pressure washing & surface cleaning company, I am the only employee right now, but I am setting everything up and trying to do the right things with planned success in the future. Somebody once told me to set the company up as if I was preparing to sell it. I have not fully figured out that proverb yet, nor do I plan on ever selling anything, but what I do know is I want things done right and I have a vision.

Obviously with me being the only employee, I am only able to do this on weekends or an evening as I still have my 9-5. This is only for the time being though, as I am driven to make it a successful company and have set some goals that I find achievable through grit and drive.

I guess what I'm trying to say is in the present moment this just has "side gig" curb appeal; that is not how I am setting it up though from a business perspective nor do I carry that demeanor.

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I just hired someone to do patio/driveway/ sidewalks at my house, I think he charged .12 a square foot. I thought he was a little too reasonable and gave a nice tip for the work.

Hope that helps

[dosrobles]

Call a couple of guys to pressure wash your driveway or fence and do some
Market research

[rberg]

Here is a basic guideline:
If you had no jobs, but still have the expense; that’s overhead (rent, utilities, truck, etc)
If you have jobs, those materials are job costs.
Do you pay yourself, or work off what you make?
If you can charge by the work performed, and not by the hour, you are better off.

PM me and I can go into more details

[Rubberdown]

Step 1. Don’t refer to your pricing as a scheme.

[WItoTX]

Call a couple of guys to pressure wash your driveway or fence and do some
Market research

This where I would start. Call a car dealership and ask what they charge to do the lot. Figure out whatever market you want to be in, then call those places and ask what they are paying.

Lots of folks post that they pressure wash for $xx on their signs in the median in my neighborhood. You could also start there.

Since it's a side gig, where I would start is figure out what it costs you, then just charge a certain % more. Work a month, and see where you are at on costs and revenue. Tweak from there. It's not rocket science, don't overthink it. And make sure you have insurance. Good luck.