How do you set prices for your goods and services?

[Jstpssng]

Every year I take some vacation time and prune a small apple orchard. When I started I was staying about 5 miles away; it' about 50 miles from where I am now.
Today I'm going down to negotiate a significant rate change; in lieu of cash increase I'll be asking for apples this fall, as they usually have a surplus and I can sell the product at the farmer's market.

I've always had some side job going on for 30 years; Negotiating prices and collecting money has always been my weak point.

 

[forgeblast]

Thats a difficult one. But you can clearly show that the price of gas has increased, and you may be able to adjust your price on the new cost to you do come and do the pruning. I think I would go in with the following points.
1. Cost are going up,
2. Instead of cash you are willing to take a product(how much when will you collect and what type?)
3. Be prepared to haggle.
To help you negotiate (and this is what I did when I first started out teaching) practice in a mirror, over and over again. Practice until you can say what you have to with out laughing or getting upset.
4. Be prepared to walk away, if they say no your not going to get an increase or surplus what do you do then. Have an "exit" stragegy. If they need you more then you need them you may be able to get what you are asking for. If its the other way around then your up a creek.

 

[JimRB]

One of my accounts wants to hire me full time. I don't really want the job as I fear I may finish up all the stuff that needs to be done in a year and then be bored out of my gourd. So now I need to look at what I was making 5 years ago, factor in inflation, factor in raises I did not get as the business was not growing and our billable rate did not change in a long time, factor in probably not getting to work from home as often I am now, factor in the lack of variety. Then factor in working for a business that is not living hand to mouth. I need to present them with a number I want to live with. A good deal starts with both parties being satisfied.

The fact that you moved 50 miles away is not really relevant. You could argue that fuel is 3 times more than it was though, groceries are a lot more expensive. Getting a 100 bushels of apples to sell sounds like a good deal for you. Does that sound like a good deal to you? Maybe you need a 150 bushels. I have not bought a bushel of apples in 10+ years so I do not know the going wholesale rate. Remember if you get bushels of apples then you have to transport and sell them. $16 a bushel retail means you might get $8 from the fruit stand plus your fuel to transport. I have no idea about the numbers but you should. If I want to sell apples off my trees (I have 2 dwarf trees and I am not a farmer) I would need to wash them first as they have mildew on them. I guess maybe I should take better care of my trees as I could sell them at the organic stand, at least a few bushels.

I am at stage 3 and 4 of Forgeblast's observations.

 

[Iplayfarmer]

I'm not good at pricing my time, but I do price a lot of goods. I'm hopelessly addicted to Craigs List, Auctions, and E-bay. I typically start my calculation at half of retail. Then I figure up or down from there depending on condition, demand, and my needs.

If I'm looking at an upcoming auction where there are a lot of items I want to bid on, I may discount some of my other stuff to make room and free up some cash. Season factors in, too. I will ask a lot more for a snowblower in October than I will in June.

The other thing I've learned is that I make money when I buy not when I sell. The market pretty well sets my selling prices. I can make money when I can buy something for a lot less than the market value. Consider this as you're dickering for apples.

 

[kenmac]

Well, I'm not in the apple business. But, I price my services within the going rate for my area. When gas prices rise. I don't raise my HR rate .But, My service call price price goes up