subject: Setting and Raising Prices: Lifestyle and Marketing [print this page] Setting and Raising Prices: Lifestyle and Marketing
If you think you need to live large to attract business, think again. What attracts business is a valuable offer delivered to the right prospect with confidence, integrity, and consistency. On the other hand, it is almost impossible to attract business when you are desperate for work.
Your lifestyle choices can underscore your commitment to an authentic and connected life, one lived in awareness and respect of the well-being of others and of the planet. Living these choices and letting them inform how you show up in the world can be a compelling aspect of your personal marketing formula. They can distinguish the offer you are in your chosen market niche.
Insurance, Taxes, Retirement, and More
Other considerations for the self-employed are medical, dental, life, and disability insurance. In addition, you may need professional liability insurance, insurance on your equipment and records, and insurance to protect you in the event of accidents on your premises.
Self-employment taxes can take the unwary by surprise. Check with your accountant (you do have one, don't you?) and find out what your tax liabilities are likely to be.
How do you plan to fund your retirement? There may be tax-advantaged plans available to you as a small business owner. Again, check with your accountant. (Have you noticed that one of the expenses you will need to plan for is accounting?)
It is easy to overlook hidden costs such as depreciation. Think about the furnishings and equipment you use and how often you will need to repair or replace them. Where will you get the money for these expenses? How will you pay for software upgrades or for a technician to debug your computer?
The following outline can help you understand how to set your own rates and why there is no "one size fits all" formula.
How Much Do You Want to Take Home? Net Income Versus Gross Income
Here's a partial list of expenses you may incur in your business.
Taxes
Benefits
Medical insurance
Disability insurance
Dental insurance
Retirement
Overhead
Depreciation (it's not theoretical!)
Replacing furnishings
Replacing equipment
Upgrading software
Administrative overhead
Clerical help
Bookkeeping
25-50% of your time to manage and market your business
Vacation, Holiday, and Sick Pay
Where Does the Time Go?
Hint: Keep a running list of everything you do for thirty days. Not a "to do" list, but an "I did" list. This will help you to understand where your time goes.
