While coaching a young entrepreneur I was reminded of several common mistakes made by new business owners. The fifth mistake I’ve encountered is “poor pricing practices.”
Recently, a young web developer was hiring someone to help him. This entrepreneur’s billing rate was only $23 per hour and he was going to pay this new employee $15. I realized my friend had a problem.
After taxes, benefits, and management time, this young man would lose money. It’s often difficult for entrepreneurs to establish an hourly rate that adequately pays them for their value.
1 Timothy 5:18 teaches, “Do not muzzle an ox while it is treading out the grain,” and “The worker deserves his wages.”
When possible, establish pricing based on the value you bring rather than the hours you worked.