Figuring out pricing and rates in your virtual assistant business can be a struggle. It can be a confusing and often taboo subject.
But it’s still something that’s a necessity in order create your business. Hopefully this article will take some of the mystery out of it for you.
Keep in mind, there are so many different ways to figure out rates for your virtual assistant business—this is just one method that has worked for myself and my clients.
Step One: Come up with a base hourly rate
First, you want to come up with a base hourly rate you need to charge in order to make money in your business—the amount you feel that you need in order to be successful.
That number is different for everyone, but here is a simple formula to figure it out:
- Start with a yearly income figure that you’d like to make.
- List all expenses for running your business and assign a yearly dollar amount to them.
- Add the yearly income amount and the expense amount together. This is now your new income goal.
- Figure out your billable hours. Start by noting how many hours you’ll work per week. Then subtract time from that number for things like vacation, sick time and business admin time. The number of hours left will be your final billable hours.
- Divide your income goal by your number of billable hours. This number will be your hourly base rate.
Ready to try it? Here’s a free worksheet to get you started:
Step Two: Create packages from the hourly rate
Here’s where it gets interesting. I don’t recommend that you just slap your hourly rate on your website and ask clients to sign up with you per hour.
A better idea is to come up with value-based packages that compile a number of your services in order to really help your clients and have you bring in a steady income.
This way, you’re not trading dollars for hours (because you’ll get better and faster and what you do, and then you’ll be stuck on pricing). Instead, you’re offering serious problem solving for your clients, and they’re paying you in advance every month.
Here’s how to do that:
- Think about the services that you regularly provide for your clients over and over again. Can you bundle some of those services into a monthly package that will be a no-brainer for your client?
- Could you come up with a setup package for new clients and then a monthly maintenance package?
Example: Let’s say you’re a social media VA. You could offer an initial online marketing setup package that includes setting up profiles, creating a consistent brand message across social media channels, setting up an online marketing plan, etc. Then you could offer a monthly maintenance package that includes things like posting for them, monitoring comments, keeping track of stats and their overall marketing plan, etc.
- Now list all of the tasks that you’d have to do in this package and how long it will take you to do them. Remember to add in time for things like client communication, research and unexpected issues.
- Now add up the number of hours in the package with your base hourly rate. For example, you might create a package that will take you 10 hours to complete. To figure out the cost, it’s 10 X your base hourly rate.
Step Three: Wrapping your mind around this concept
My coaching clients find this exercise extremely helpful in creating their rates. But when they do the work and actually write down that number, sometimes it can be scary.
They say things like, “Wow, I can’t charge that amount! It seems so high. Who is going to pay me to do that for them?”
This is when it’s time for a little mindset altering:
- Before they do this exercise, many women that I work with will already have an hourly rate in their head that they think they should probably charge. Where does that number come from? They look at their salary in their full-time job and translate that to an hourly figure. But if you did that, you’d never make enough money to have a successful virtual assistant business. Remember, you’re not receiving a regular paycheck anymore that already includes deductions for insurance, retirement and sick time. You need to figure that all in to your base rate.
- What’s your time worth? You are really good at what you do. You are providing awesome value to your clients and you deserve to be paid well for that value.
- Remember that you’re solving a problem for your clients. They are good at what they’re good at, and you are good at what you’re good at. In other words, the things that come naturally to you don’t always come naturally to others, and they’re willing to pay you to take care of those things.
Example: A business coach might know how to send out her newsletter, but that’s not her area of brilliance. However, you rock at all things email marketing and have already thought of a whole list of things she can do to enhance her newsletter and bring in more clients. That’s why she’s hiring you.
- You could also offer a lower introductory rate to new clients in order to feel things out. Then see how long it really takes you to complete the tasks. Once you work with someone who is willing to pay for your services and you have that experience under your belt, your confidence will increase—and then you can increase your package price with confidence!
Those are my 3 steps on figuring out what to charge in your business.
Recap: Configure base hourly rate, create packages, know that you can do this!
Try it and let me know how it works out for you!