Hey Hey! So you’ve decided to embark on the journey of starting your very own home organizing business- super exciting and CONGRATULATIONS. There’s nothing like running your own business!

So I’m sure you’ve strategized for a longggg time, right? You’ve figured out the services you want to offer, who you want to serve, AND all in all, the value you’re loading your dream clients with.

If not, you’re in luck! I’m walking you through 3 ways to determine a price that factors in your expertise, time, and most importantly, value!

Let’s get started!

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1. Market research- “Shop” your competitors

It wouldn’t be right if we didn’t research first, right? Do a little digging. Research the professional organizers in your local area and see what the going rate is. This is helpful with establishing a baseline or an idea of what your potential clients are willing to pay for the professional organizing services you offer.

But, don’t rely so heavily on what others are doing. Remember, this is your business. Determine the additional services you plan to offer your clients, your expertise, the time it’ll take, and price accordingly. For instance, along with the time I spend in each client’s home, I also do their product shopping, donation drop offs, and connect clients with other service providers as needed. My rates reflects all of these additional services.

2. SET A FINANCIAL GOAL, HOW MUCH MONEY DO YOU WANT TO MAKE FOR THE YEAR AND CALCULATE YOUR HOURLY RATE?

ANNUAL INCOME: $85,000  | HOURS WORKED PER WEEK: 40 

Follow this formula, and don’t worry, you DON’T have to be a math wizard to figure this out! Better yet, I’ve created a simple template for you to plug and play right HERE. 

1. Calculate your expenses:

Include all of your expenses- website hosting, software subscriptions and fees, internet, telephone, rent, utilities, office equipment, computers, office supplies, professional tools, business related memberships, certifications, travel expenses, advertising and marketing costs, legal and accounting fees, mileage, taxes, insurance/benefits, business cards and stationery.

• Overhead expenses: $15,000
• Salary: $85,000
• Benefits/insurance: $9,000

The total annual expenses: $109,000

2. Calculate Total Cost Of Doing Business

Calculate the profit margin you want to see in your organizing business. A common profit margin for consumer based services is 10-20%. We’ll play it safe by using a 10% profit margin.

Quick definition for ya 🙂 Profit margin is a ratio of a company’s profit (sales minus all expenses) divided by its revenue.

$109,000 × 1.10 = $119,900

3. Calculate Total Numbers of Worked Hours

So if we do the math, there are 2,080, work hours in a year (40hrs/week * 52 weeks in the year).

But, I’m gonna take a wild guess and say you’re not gonna bill every hour for 52 weeks, right? Right. You have to account for breaks- lunch breaks, bathroom breaks, brain breaks, phone calls, admin stuff, sick days, vacation, holidays… you get the gist right?

So make sure you’re capturing your holidays

• Holidays: 11 (New Year’s Day, Presidents Day, Juneteenth, Martin Luther King Day, Memorial Day, Independence Day, Labor Day, Veterans Day, Thanksgiving Day, Friday after Thanksgiving, Winter Holidays)
• Vacation: 14
• Sick Days: 8
• Business Travel Days: 5

The total number of holidays, vacation days, sick days, and business travel days equal 38 days or 304 hours.

If you take a one hour lunch and spend only 90 minutes on administrative work, phone calls, email, and meetings each day, that means you’re working 5.5 billable hours a day or 27.5 billable hours each week.

Let’s do the math:

• 27.5 hours/week × 52 weeks/year = 1,430 hours
• 1,430 hours – 304 hours = 1,126 hours

So, instead of working 2,080 hours each year, you’re only working 1,126 hours each year.

4. Calculate Your Hourly Rate

Now that you know your total cost of doing business is $145,200 and the total number of billable hours you will work per year is 1,126, you can calculate your minimum hourly rate:

• $119,900 ÷ 1,126 = $106 per hour

As you can see the minimum hourly rate needed to achieve a freelance income of $100,000 in this example is almost triple the original calculation of $50 per hour. The problem with the first approach to setting an hourly rate is that it failed to account for all of the expenses, days not worked, and profits.

3. Poll your target audience for price points on your social media accounts

This one is simple – gather price points from your audience on different platforms like Instagram and Facebook (by the way, are we friends yet?). What are they willing to invest in with your services. A quick hint here, make sure they view your content as valuable on these platforms… you lead with value and showcase your authority. In return, they’ll throw out realistic numbers for ya! And to add some more goodness with this tip, engaging your audience in this manner sends the message that their voice matters.

Alright, girl- that’s it! Literally a cake walk, right! Do some market research, set a goal (follow my formula here), and poll your audience. All three will help you CONFIDENTLY create a price that showcases your value and will attract your dream clients!