Freelancing for a few years, and I still struggle with pricing. It’s hard to tell if I’m competing fairly or missing out on earnings.
What profit margin percentages do you all typically use? I get that each field is different, but I’m interested in how you do the calculations.
I usually add my living costs and a bit more for good measure. Simple math works best for me.
Stop overthinking the math. I price jobs based on three things: what it costs me to live, what the work is actually worth, and what the market will pay.
Most service pros I know aim for enough to cover their bills plus 25-40% on top. But that number means nothing if you don’t know your real costs first.
Track your expenses for a month. Include everything - truck payment, tools, insurance, the coffee you buy between jobs. Then figure out how many billable hours you actually work. Divide those numbers and you’ll know what you need to charge just to survive.
Everything above that survival number is your profit.
I just charge what feels right and covers bills.
Forget percentages for a minute. Here’s what actually works:
I learned this the hard way after undercharging for two years. Now I know exactly what I need to make per hour just to break even, and I price from there.
The margin isn’t really a percentage thing. It’s more about covering your actual life costs plus having something left over for the unexpected stuff that always comes up.
Profit margin varies based on expenses and living needs. I typically look for at least 30% after covering all costs like taxes and business expenses.
Consider if you can pay yourself a fair wage and have extra for slower months. Start with your monthly needs, add 20-30% buffer, then calculate what to charge.