It took me many late nights of below minimum wage pay to stop and think about how I was charging for my services; actually, it took my husband’s inquisition. After I noticed a discrepancy in my work and pay in my side gig/small biz, I began to evaluate and change my pay structure. These guidelines can be applied to a wide range of businesses as they uniquely focused on the small business owner.
Be Honest with Yourself
How do you work? Are you a like a tortoise: methodical, research-based service provider that explores all possible avenues then performs extensive editing before submitting your final product? With all of the in-between-the-lines work, you should charge your services by the hour. Or you may be a hare: an efficiency queen who can churn out your project with astonishing speed. In this case, it’d be best for you to set up a pay by package structure. Your speed doesn’t matter as long as you are supplying a top-notch service, but stepping back and taking stock of your workflow is vital in determining how you present payments to your clients.
Transparent Work Break-down
The first step in building a strong relationship with yourself as a small business owner is fully understanding your service and the steps necessary to provide your it. I recommend tracking your work from start to finish. Set up an excel worksheet with each mini task and the amount of time it took you to complete it. When you are tracking, be sure to include the administrative work, research time, and communication minutes. This tracking is especially important for a side gig, small business moms because we tend to collage our work hours together.
Share your hours and itemized work with your client. This can be communicated through a formatted visual, you might use Canva or a similar platform to build an appealing aesthetic for this document. Or you might have it prepped and ready to reference in your initial discovery call together. The point is to have a clear picture of your project information compiled for you and your client so that you’re on the same page through the service lifecycle.
You’ve polished off your work steps, so now you can begin to configure how much your time is worth. You need to separate your hourly wage from that of your past full-time, corporate, 9-5 job. Now that you’re a contract/freelance/gig worker, your hourly will be higher because you are not garnering the benefits and additional hours like in a corporate position. Landing on your rate of pay takes research. Here are questions to guide your quest to nail down your hourly rate or packaged rate of pay:
These research points will also help you to frame your compensation package. You may start with an hourly rate then merge to a whole sum tab once you’ve become more efficient. Like your business, your earnings should be fluid; by that, I also mean they should increase with time, experience, and reputation.
Now that you’re clear with your numbers it’s time to present them to your client. Use a clear contract to share your specific services and cost sheet. It is helpful to give your client options to meet their needs, and boost your chance of booking an initial service with you, then adding more as they grow to adore your services. The most important piece in building your compensation is to be clear and fair to yourself and your client.