One of the hardest things about having your own virtual assistant business is determining how to price your services. If your prices are too high, you will lose potential clients. If your prices are too low, you could also lose potential clients or not make a profit when you do find work. When it comes to pricing your services, it’s not an exact science, which is the reason it’s so difficult. Not only are there a ton of services out there, there are also many layers to a service.
Deciding your own pricing comes down to several factors.
Let’s start with the bottom line. You need to make at least enough to cover your bills.
How to determine your bottom line.
First, I want you to think about how much you need to make a year to pay your bills. Add up all of your monthly bills. This may mean your car payment, house payment, your utilities, your insurance, your grocery bills, etc.
Once you figure out how much you need to survive, you’ll need to look at how much you may want to put into a savings account. It is important to save money and easy to do if you lump that into your bill category and make sure it goes into savings each month.
Next, I want you to think about your other expenses. Do you have software that you pay for? I use Kartra, Canva, and others. I would add the monthly cost of those systems to my overall expenses. I also have subcontractors that I use to do work for me. That is also an expense that I need to account for.
Do you have a retirement account? How much do you want to add to that? I have a Roth IRA that I contribute to monthly, so I factor that into my expenses.
How to determine how much you need to make a year.
The next step is a lot of math, and if you are bad at math don’t fret. There are online tools that can help you calculate it all instead of doing it manually. I will show you a simple example so you can try it for yourself.
Let’s say that your expenses come to $25,000 a year. Maybe that includes mortgage, cars, utilities, and a retirement account. You want to make a profit of $25,000 as well. So, when you add that up, you’ll need to make $50,000 a year.
As a new VA, that can be a scary number, but it’s really not scary if you break it down. There are 52 weeks in a year. Factor in a 2-week vacation and let’s say you are working 50 weeks total. So, $50,000 divided by 50. That is $1,000 a week.
The next step is to determine your hourly rate.
Do you want to work 10? 20? Let’s say you want to work 20 hours a week. Divide $1,000 by 20. That number is 50. You need to make $50 an hour. What if you don’t want to work 20 hours you only want to work 15 hours a week.
Again, divide it by $15 and that is $67/hour. Now, those 15 hours are billable hours. That does not include marketing your own business, working on your business, doing research or learning things on your own. That is 15 hours that I am billing to the client.
The problem with relying on this calculation.
That is one great way to determine your hourly price. But, there is a big issue in only considering this calculation. Because, although you may need to make $67 dollars an hour, you may not be providing services that are worth charging that amount.
You probably can’t charge $67 an hour to organize someone’s inbox. Things like admin tasks, data entry, calendar management, etc., those things are going to be a lower-tier service. These lower-tier services are something that new, or more general virtual assistants do and those are lower-priced services.
As you learn more skills, you are going to increase that rate. The more higher-level skills you learn, the more you can charge. Now, what do I mean when I say higher-level? Web design, tech skills, funnels, SEO, and Facebook ads, are all examples of higher-level skills that you will be able to make more money with. This list is not inclusive of everything but you get the idea.
There are some services that can be lower-tier as well as higher-tier. Social media management is a great example of this. You could be doing the lower-tier work such as scheduling Facebook posts, or you could be working on data pulling and social media strategy which is much more complex. The more skill that you can offer to a potential client the more money you can charge.
Okay, so how do I determine what to charge?
If you are just starting out as a VA with limited skills, $25-$30 an hour is a good place to start. As you learn more skills, you’ll be able to increase that rate to around $45-$65 an hour. If you learn some very high-level skills and gain more experience you can charge $65-$100+ an hour.
Do some market research
You can also do some research to see what others in your niche are charging. Now, take into consideration how much experience they may have and who their ideal client is. That is going to make a big difference when determining your own rates.
Go with your gut
If you’re still unsure, go with your gut. If you feel like you don’t have enough experience to charge what Sally the VA is charging, then don’t. Being confident in your pricing is important. As you gain more experience and knowledge, you’ll feel confident to raise your rates down the road.
Was this helpful? Let me know below and don’t forget to join my Facebook group, Become a Tech VA, for more community, tips, and trainings.
Are you a virtual assistant who wants to learn more tech skills?
The Top Platforms to Learn as a Tech VA