What your time actually costs.
THE STARTING POINT
Your time is not free, even when you are the owner.
WHAT TO CALCULATE
What you need to earn in a year How many hours you can actually bill The cost of running the business
BILLABLE HOURS
Far fewer than working hours.
Selling, administration, chasing payment and everything else is unbilled.
For most small service businesses, half of working time is billable at best.
THE CALCULATION
Annual costs plus what you need to earn, divided by realistic billable hours.
That is your minimum hourly rate.
WHAT PEOPLE DISCOVER
That their rate is well below what it needs to be.
WHAT ELSE TO INCLUDE
Software and tools Transport Equipment replacement
Time spent not working: illness, holidays
FOR FIXED-FEE WORK
Estimate the hours honestly, then apply your rate.
Then add a margin for the work taking longer, because it will.
