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When it comes to setting up your side hustle, one of the most important things you’ll need to get sorted is how much you’re going to charge for your services or what price you’ll charge for your products.

Pricing your offer can be somewhat of a headache, particularly if you’ve never had to do this before.

How much should you charge, will people actually pay that, what about market conditions…?

All valid questions and things you’ll need to consider when pricing your offer, whether that’s your freelancing services, consulting hours or your products.

Here’s what you need to know:

It’s important to understand that there is no hard and fast rule when it comes to pricing your product or service, it’s all about testing and seeing what the results tell you.

That being said, if you’re just getting started in your side hustle, you’re in a unique position to test out some of the ideas below and find what works for you and implement these early on — rather than being further down the track and having to adjust and tweak with current clients and customers.

Grab the PDF Guide to Pricing Your Services

15-page PDF that will give you all the deets on how to price your services for success in your side hustle!

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How to Price Your Offer aka Your Services and Products

7 Things to Keep in Mind When Pricing Your Offer #sidehustle101

Below are seven things you’ll need to consider when pricing your product or service…

It’s also important to understand that pricing shouldn’t be set in stone, it should be reviewed and updated regularly, at least every 12 months, to ensure you’re not leaving money on the table and that you’re in line with the rest of the market you’re in.

Here’s what you should focus on:

#1: Price Elasticity

What the heck is that?! It’s simple, or rather, simply explained by the guys at Fizzle:

“All you really need to know about price elasticity is this: if all else remains equal, demand for your product or service will decrease with an increase in price.”

Once you understand this, the rest of the considerations below will make a whole lot more sense.

#2: Is There Demand for Your Product or Service?

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Have you done your research and figured out what the demand is for what you’re offering?

Inside the Side Hustle Blueprint course, I go over this in a lot of detail, but the cliff notes version is this:

  • Take your service or product and do a quick Google search with the following terms included, ie, "freelance design jobs" or "ecommerce courses"
  • Investigate what comes up. Places like Upwork, Udemy and Skillshare are great places to check out to see how much demand there is for a service based business. For a product based business, check out sites like Amazon and Etsy.
  • If you see a lot of the service or product available, it's fair to say that the product or service is in demand and if you notice any ads during your Google search in the same vein, definitely in demand

It’s important that you do this exercise before you get too far down the side hustle rabbit hole in getting set up. There is nothing more demotivating than finding out no-one wants your product or service.

#3: What Are Your Overheads?

When it comes to pricing your products or services, have you taken into consideration your overheads? How much is it going to cost you to deliver your product or service?

Do you need to factor these into your pricing or will you shoot for an arbitrary figure? It would stand to reason that you should probably incorporate these in, unless they are negligible or taken care of by someone else.

In all likelihood, this won’t be the case and you will have some costs to cover. These could include:

  • Internet
  • Computer equipment
  • Cellphone costs
  • Product production costs

These are just some of the items to consider in your overheads. The best way to get a true idea of your overheads, is to sit down and write down everything you use and do to deliver a product or service, then write down the dollar figure associated with that item.

Then you can average that out over a 12 month period and then break it down further into an hourly cost.

I like to use the following formula when pricing freelancing services:

Hourly Rate (incl. overheads) x Approx. Hours to Complete Project + Project Costs + Profit % + Local Taxes = Project fee

It’s a good place to start and then you can work from there.

#4: Is it Specialised?

Is the product or skill a very niche, specialised skill that few people can do? An example of this would be a neurosurgeon. Very specialised and niche and there are definitely not a lot of people who have this skill.

This means that neurosurgeon’s can charge a premium price for their services.

Of course, this is going to be slightly different in your side business, but if you are in a niche where there is very few competition or the skill is highly specialised, you will be able to charge higher rates compared with other markets.

I don’t need to tell you whether your product or service is specialised, you should already have a fair idea of this before you’ve started your side hustle.

Using packages as a pricing strategy#5: Are You Offering Packages?

No matter what type of product or service you’re offering, there is always the option to incorporate packages into your side hustle.

Packages provide you with a bit more room for premium pricing and can be tiered, such as offering a basic, mid and premium package structure.

If you’ve got a product, you could offer discounts on the more products people buy, or a bundle option with free shipping.

You can provide more perceived value by offering packages and still come out on top. It’s definitely something to consider if you’re offering multiple products and services.

#6: Have You Received Feedback From Customers?

If you’re just starting out in your side hustle, you might not have been able to do this just yet, but I’d encourage you to do it as soon as you can.

Your customers will tell you if they think you’re pricing is off mark, but if you want to be proactive, ask them to complete a small survey following the completion of a product or service delivery.

You can ask a few simple questions, such as:

  • Do you think the price you paid was reflective of the work (or product) you received?
  • How could we do better?
  • What other services (or products) do you think we should offer?

If you’re using a service like Freshbooks, they provide the option of delivering a survey to your customers once an invoice has been paid, so you could incorporate this in that process.

Other survey options include:

#7: What Are Your Competitor’s Charging?

While this isn’t the only factor you should focus on, it can help if you’re not sure where to start re pricing.

Start by researching your top 10 competitors and noting what they are charging for the product or service you’re looking to offer as well.

Once you’ve got these numbers, it’s time to place them in order, highest to lowest. Once you’ve got the figures laid out this way, your pricing should aim to fall somewhere between the high and low price points.

Grab the PDF Guide to Pricing Your Services

15-page PDF that will give you all the deets on how to price your services for success in your side hustle!

Powered by ConvertKit
Grab Your FREE Pricing Strategies PDF Here!

Starting off in the middle is a safe place to start, with a view to increasing your rates as you get more experience or sell more products.

When it comes to pricing your offer, there are a lot of considerations to take into account. Once you understand what those considerations are, it can make it much easier to figure out your own pricing strategy. The guys over at Fizzle dedicated a show to pricing strategies that you should definitely check out if you're struggling to nail down your initial pricing offer.

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Lise Cartwright
Lise Cartwright

Founder of Hustle & Groove and your creative business strategist. If you want to get notified of new posts just like the ones you see here, then make sure you join the awesome H & G tribe — Join Now!

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