It is possible to price your business depending on the services you offer. A flat rate pricing works wonders with service delivery enterprises. Say, for instance, you own cleaning service. How do you set your rates?
The trick is in striking a balance. Too high and you will have no clients; too low and you might as well register as an NGO. Thus, the magic word here is a balance. How do we find this balance? Read on.
1. Cleaning times
What times are you available to clean? If you have heard the saying ‘time is money’, then you know that time is precious. You should, therefore, peg your wages on your average cleaning times. Most clients would prefer a per-work rate instead of an hourly rate.
When you go to someone’s house, you expect to do everything that relates to cleaning. That means:
- Scrubbing floors
- Doing dishes
- Loads of laundry
- Dusting
- Sweeping
Anything that is related to cleanup falls into your job description.
Different homes have different styles, some rooms as well as sizes. You may need to consider an upfront flat rate depending on how many places you are expected to clean, how much laundry, the dishes, scrubbing and dusting involved. If you base your prices on time, you must ensure that you do not work slowly to charge more. If you charge by work, then you must ensure that you do not overcharge or undercharge.
By job rates
You could test with your own house or friends’ and family’s homes. How long does it take to clean your own house and calls for timing yourself? How much effort is involved? Make sure that you mix up the apartments – big homes and small ones – and time yourself in:
- The living areas ( family rooms and dens, dining rooms, etc.)
- Bedrooms
- Bathrooms
- Foyers
- Kitchen
This way, you can estimate how much to charge for the rooms depending on how long it takes you to clean them. You do not even have to go their homes to give an upfront rate. Your quotation will also be more accurate. A more natural way of setting up your flat rate is checking out flat-rate pricing apps like Coolfront, and other such apps could give you ideas and even give you a format you can use.
2. Model of pricing
You have three models to choose from:
-
Hourly
-
By the job
Hourly
When you are only just beginning, this would be an excellent model to work. You must, however, be careful not to be accused of being deliberately slow so as to get more money. That kind of reputation will not get you any referrals.
If you have arrived at a flat rate, then you could use that to let your clients know before you start working. Of course, you must be clear about precisely what expected clean so that you can do an average.
By the job
This one might be a preference for most people because it is measurable. It is imperative that you factor in hard to clean areas or places that take time to clean so that you are fair to yourself.
Once you decide on a rate, you cannot go back on it because you went there and found a palace. It might, therefore, be a good idea to find out as much as you can about the properties around your area so that you give the correct rates per house. You can charge per room and then add it all up. That way, you will not be rushed and can work in a relaxed manner.
3. Think profit
There must be others around you offering the same services. It would be of great help to you if you could find out the market rates. Clients will always go for the cheaper option. That is unless you have a reputation for turning homes into gleaming paradises.
You might fall into the temptation of going lower than your competitors. That may not be a great idea. You might end up earning peanuts or running a cleaning NGO.
Consider your overheads
In other words, what does it cost you to run this business? Do you bring along your equipment and supplies or does your client provide the same? Do you have an employee or employees? Maybe you drive out to your clients’ homes, so there is fuel to consider.
Even if you do not have any employees yet, work like you have a couple. You are a growing brand, and before long, you will have some. Besides, you have employed by your business, and you are therefore on a wage.
Your profits should be value-based
You are offering very high-quality services, and you are worth every penny paid. Therefore, you need to have a target market. High-income clients are likely to pay a reasonable rate. Test your prices to ensure that you are not underselling yourself.
How?
Say you want to hike your prices a little. You have some clients, most of who give you good business, but a few offer you almost none. These are the ones you test your new rates on because even if they leave in a huff, they were not bringing in much, to begin with, so it’s no significant loss.
You have some practice dealing with objections and negotiating before you can try the same on the clients you do not want to lose.
Of course, you should be careful with any rise in rates. Nobody wants to pay more. There should be a good reason that your clients would understand, for instance, inflation. You are paying a little more for supplies because the prices for the same have gone up. That is a reason that anyone should understand.
Also, remember that your time is precious too. You are charging for your time and effort as well. Be sensible; otherwise, you will have a service that nobody wants to pay.
If you are running a reasonably large cleaning service and you want a flat rate pricing, there are IT companies that offer apps like Coolfront that can help you to set up your flat rate system and also assist you in keeping it updated.
Thank you,
Glenda, Charlie and David Cates
