How to Price Services: 3 Tips to Find the Pricing Sweet Spot

When you own a service based business, pricing your services can prove a surprisingly challenging feat. You don’t want to undervalue your services, but you don’t want to drive customers away either.

Over 20 years ago, the sugar industry came up with what they called “the sugar sweet spot”. This refers to the amount of sugar added to food and beverages that isn’t too much, isn’t too little – it’s just right.

They’ve obviously got it all figured it out, with sugar in almost everything. So what can we, as business owners, learn from the sugar industry in regard to pricing?

Here at OSC Web Design, we think we’ve found the pricing sweet spot. Find it for your own business with these 3 tips!

How to Price Services

1. Review your pricing structure.

For many services, you will need to determine whether to charge by the hour or a flat fee. There are benefits as well as drawbacks for both options.

  • Flat Fee

Clients tend to prefer a flat fee over hourly. This frees them from worrying if you’re running behind schedule and racking up a bill. At the same time, there’s a chance they’ll balk at a larger (but realistic) price tag.

  • Hourly

Choosing hourly is safer for you and means you’ll never be stuck working for free. If you inaccurately estimate how long a project will take you, be prepared to likely face an upset customer.

Want to compare an hourly rate to salary? Check out this salary calculator.

  • Combination

Perhaps you hire labor under you. You may want to consider charging a flat fee for your services (the expert) and charging hourly for their part in the project.

2. Look at the competition.

With practically every business up on the web, it’s usually not hard to track down your competitors’ prices. While you don’t want to get into a back and forth pricing battle, you need to be in the same ball park.

After you’ve determined you’re in range, look for areas to set your business apart. Own a landscaping business? Sometimes saying “we can customize services to fit your needs” is too vague. Put together unique package options for them.

If your competition doesn’t list a price anywhere, this may be just as frustrating for potential customers as it is for you. Dispel the mystery and make your business the obvious choice by listing prices clearly on your website.

3. Cost-Plus Pricing

It’s always wise to have a good idea of your expenses anyway. To determine your services’s cost, you need to consider fixed costs, direct costs, and indirect costs.

Some commonly overlooked expenses:

  • Insurance
  • Employees and benefits
  • Training employees
  • Equipment and updates
  • Permits
  • Payment delays

After you’ve added up all of your expenses, divide that by the number of jobs you expect to undertake, add on your profit, and voila – you have a service price.


Are you able to use the previous 3 tips to find your business’s pricing sweet spot? Or perhaps you’re distracted by cravings for Dove Bars and Twizzlers. Let us know in the comments or shoot us a message!

Salena is dedicated to creating quality content unique to each client. Besides writing, she assists the team in executing inbound marketing campaigns, social media updates, and search engine performance monitoring. To occupy her free time, Salena enjoys reading, cooking and drinking coffee.

View all posts by Salena Poussard

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