QOTD: How much should I charge for my product or services?

You’ve decided to take the leap and start making money with what you’re good at! Now the hard part. What do you charge for it?

If you’re anything like me, deciding what to charge for your product or services is more of a necessary evil. We’d all rather have fun creating and doing rather than worry about taking anyone’s money. But, as geeks who get paid, the “paid” part is pretty crucial.

In this article, I’ll cover some of the in-depth ways you can determine pricing, as well as some quick and easy methods you can use if you’d prefer not to get into the math weeds (scroll down to “Easy Mode Pricing” for those).

For each one you need to start with one important question…

What are your goals?

You don’t need to have your 5-year plan figured out or anything but think about the part you want your geek hustle to play in your life. This will help you set prices that grow with you.

Ask yourself the following:

1. Are you trying to make a little extra cash, or would you like to build a full-time income (eventually) with your work?
   
   It’s okay to just aim for a little extra cash right now (it’s how most of us start!), but be honest with yourself about if you want this to stay a side hustle or if you’d prefer to aim for a full-time hustle one day.
   
2. How much time do you want to dedicate to your work?
   
   Consider obligations like family and your day job, but don’t forget to factor in relaxation, sleep, and time for yourself. Those are important too!
   
   Example: I know I can realistically dedicate about 2 hours a day to Geeks Who Get Paid, but I build in at least one “day off” to spend with family, adding up to about 10-12 hours a week.

Again, you don’t have to have all of the answers on these, but if you have a general idea of where you stand, it will make the next pieces of the pricing puzzle easier.

Next, time to calculate your expenses.

Any hobby or business takes money. What do you spend on yours?

If, when setting your goals, you determined that your main goal is to make a little side money, this part is relatively easy. All you need to know is what it costs you to do your hobby business.

Here are a couple of examples, but yours may look different depending on what it is. There’s no right or wrong way to calculate this. It’s just going to give us a general baseline on the minimum you should charge to make sure your business is profitable.

Product Example: Handmade Dice

For creating resin dice, you need a number of supplies, both consumable and reusable. On the consumable side, you need your resin, inks and dyes, plastic cups and stir sticks, gloves, etc. Then, you have your reusable supplies. Your molds, tools, and pressure pot.

First, calculate the expenses for your consumables. With totally made-up numbers, let’s say that a resin kit costs you $30 and will make 5 full sets of dice. That’s an expense of $6 per 7-dice set. Do this calculation for each consumable and add it together. Let’s say, after factoring in our other supplies, you use $10 per set of dice.

Next, take a look at your reusables. For example (again, totally made-up numbers), if a mold will be good for 30 sets of dice and costs you $60 to buy or make a mold, that’s $2 per set. A pressure pot may cost $200 and allow you to make 200 sets of dice. That’s another $1.

So, our final expense for creating a set of dice ends up being: $13

That means when setting our prices we want to charge more than that to make a profit.

Service Example: Professional Dungeon Master

If you’re pricing out a service instead of a product, things look a little different. In the example of a professional Dungeon Master, it may not be easy to calculate the cost of a session, but you can calculate the monthly expenses for running games.

Do you maintain any subscriptions (Roll20, DnD Beyond, etc.)? How often do you buy books and supplements? If you do in-person games, do you provide supplies? If you run online games, internet is important, so let’s factor that in.

In an online DM example, let’s say you pay for the $5/mo subscription on Roll20, pay about $60/mo for internet, spend about $25/mo on new books, maps, or supplements, plus maybe $10/mo for incidentals like software, service fees, or similar.

Your final monthly expenses for being a DM are $100 per month. That means that you’ll need to make more than that from your games each month to be profitable.

The secret ingredient: Your TIME.

There’s more to expenses than just supplies and subscriptions. You’re also spending another valuable commodity, your time. How you price your time is 100% subjective, but a majority of people usually price their own at around $20-50 per hour, but can climb into the hundreds or even thousands of dollars depending on what you’re doing!

How much experience do you bring to the table? What is the quality of your work? What makes your offering unique? These things should help you land on a number that feels fair. Don’t worry. It’s not etched in stone or even published anywhere. It’s just very important to factor in for you. The goal is not to work for free.

The number you land on is your “hourly rate.”

How are expenses different if you want to do it full-time?

Here’s where we get into the “math weeds” I was talking about. If you want to make a full-time income, we want to do more than break even on the cost of the hobby. You’ll want to know how much you spend a month on living too. I won’t get too deep into this, as everyone’s life looks different, but consider things like rent, food, entertainment, and the other various keystones of a monthly budget.

If you don’t feel like itemizing, you can use your current day job income as a benchmark.

Example: Jane makes $2500 a month at her day job and wants to transition to make a living as a Twitch streamer instead. After calculating the expenses of streaming to be about $100/mo, she knows she needs to make at least $2600 a month streaming to make a full-time income.

Time to assess the competition.

Once you’ve set your goals and calculated your expenses, it’s time to figure out what others are charging for their work. It’s great to know what you need to charge to make a profit, but if your pricing isn’t at least somewhat competitive, it’ll be hard to find paying customers.

Let’s consider the examples above:

Product Example: Handmade Dice

With handmade dice, you can take a look on Etsy or other handmade marketplaces. Find at least 10-15 examples of products similar to yours (Of course, nothing is EXACTLY like yours. Yours are unique and amazing.). Try to find a range of prices, from very low to most expensive.

Let’s say, we find that people sell their dice sets for between $10-25 on average.

After calculating our expenses above, we know we’ll want to sell ours for at least $13 but less than $25 to stay competitive. But, don’t forget your time. If you set your hourly rate at $20 and you can create 4 sets of dice per hour, that’s another $5 per set.

Your minimum price for a set, then, should be $17.

Service Example: Professional DM

Again, as a service-oriented seller, your calculation will look a bit different. Remember, we calculated our expenses as a DM to be $100 a month.

After looking at a few other professional Dungeon Masters on platforms like Start Playing and social media, we learn that professional DM’s with similar experience and offerings charge $20-50 dollars per game hour (to keep things simple).

To figure out your best hourly price, you’ll want to take a look back at your goals around how much time you want to spend on this business. Let’s say you have time for 4 three-hour sessions per month = 12 hours. To break even, you’d need to charge roughly $8 per hour.

But! You guessed it — your time. If you set your hourly rate at $30/hr, that means charging a minimum of $38 per game hour.

Time to crunch the numbers.

You have your goals, your expenses, your hourly rate, and a competitive price—time to get crunching. The final question of the day is: How much do you want to make?

If the answer is “anything is fine,” then you’re already done! You can set forth with something similar to the competitive price you found in the section above and start making a decent profit right away since you’ll be making at least what you set as your hourly rate.

If you have more specific goals, for example, “I want to make an extra $500 a month.” Let’s figure out how to do that.

If your hourly rate is $30/hr (not including expenses), you would need to put in about 17 hours a month to hit your goal. Does that match your goal for time spent? If not, you can adjust your rates to get where you want to be.

In the example of the Professional DM with 12 hours per month to spend on games, instead of charging $38 per game hour, you could bump your hourly price to $50 (an hourly rate of $42) to meet your $500/mo goal in 11.9 hours.

If you’re trying to hit your full-time income of $2500 a month and you have 20 hours a week (80 hours a month) to spend, set your hourly rate around $32. In the example of the dice seller, that would mean an average price of $16 per dice set.

Important Note: Keep in mind that this is oversimplified math! Just because you can crank out 300 sets of dice doing it full-time doesn’t mean you’ll sell ALL of those dice! Likewise, just because you have room to run 12 hours of games doesn’t mean you’ll always be booked solid.

Product sellers also have to consider seller’s fees, shipping, and lost product due to defects. It happens to the best of us.

Knowing this, if you have the space to do so and stay competitive, it can be beneficial to raise your prices above your minimum to account for mishaps, slow months, time off, etc.

What if things aren’t adding up?

If your time available and rates just aren’t adding up, it’s time to get creative. Many of the most successful geekpreneurs I talk to aren’t making all of their income from just one thing. They diversify.

See if you can identify another way your hobby can make you money in addition to your main product or service. Even better if this can be recurring or passive (meaning it doesn’t add on more hours of work for you).

For products: Is wholesale an option? Can you offer pricier custom orders or commissions? Have you considered offering recurring orders, like a subscription? How about a Patreon or Ko-Fi?

For services: What about selling merch? Finding sponsors or partnerships? Offering teaching or training? Adding a stream or YouTube channel you can monetize?

There’s also no shame in keeping your day job or other side gigs while you build-up to the level where your hobby is making you enough to make ends meet! There are many paths. 🙂

TL;DR? Here are some Easy Mode Pricing options.

Average Cost of Your Competitors: If expenses aren’t a huge barrier, you can easily set your prices to an average of what your competitors offer. If they are in the range of $10-20, set your price at $15. That puts you squarely in a competitive range for sales.

Base Hourly Payment: Set your price based on what your time is worth per hour. This is commonly seen for products or services with a wide range of pricing like custom art, programming, or consulting. This allows you to keep things simple and predictable for both yourself and your customers.

Cost + Percentage Pricing: Figure out the cost to create your product or offer your service, then mark it up by a certain percentage. If it costs $10 to make a product and you want 50% profit, charge $15. If you’re using Etsy to sell, you can use a handy calculator like this one to incorporate fees too.

Again, these do not take into consideration your expenses or goals, which will create a more sustainable pricing strategy in the long run, but using any of these are a great way to get started and test out your business model until you’re ready to run with the full-on planning above.

Final thoughts on setting your prices.

If you made it to the end of this article, you might have any number of feelings about setting prices for your side work. Maybe you’re excited about starting to see that money coming in. Maybe you’re daunted or confused. But, once you’ve taken that first huge step toward taking your hobby from money taker to money maker, it’s going to feel oh-so-good to get rolling!

Don’t forget, though, I and the whole Geeks Who Get Paid community are behind you and here to help with your questions! If you get stuck, leave me a comment below and I’ll do everything I can to help!

Want to hear how others are doing it? Check out our Interviews section to hear about existing business models from established geekpreneurs.

Erin is a great example of the Average Cost model, while RJ Cresswell does really well with the Base Hourly pay option.

I look forward to hearing about all of your success!

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