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You can't charge for value if you don't understand your cost.

In the WordPress Community, we talk about value — quite a lot. And that’s awesome. We should charge for our value. The problem comes when we don’t understand our cost — both in financial, physical, and branding terms.

Having spent over ten years in construction accounting, “job costing” is in my vocabulary and the front of my mind. But as a marketer, I also understand that WordPress has a branding problem. In order to elevate our personal brands and the brand of WordPress, it’s important that we go beyond value and take a look at cost.

In this talk, I’ll discuss job costing, sample time tracking, and just how to reverse engineer your pricing to not only meet your expenses, but live the life you want.

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You can't charge for value if you don't understand your cost.

  1. 1. @YouTooCanBeGuru Youcan'tchargeforvalue ifyoudon'tunderstand yourcost. WordCamp Los Angeles 2018
  2. 2. Time Tracking: How I realized I was working for minimum wage. @YouTooCanBeGuru
  3. 3. @YouTooCanBeGuru
  4. 4. “We price by the service, we price by the value we bring, not our time.” Alex Vasquez @YouTooCanBeGuru
  5. 5. Let's talk about value. @YouTooCanBeGuru
  6. 6. Let's talk about cost. @YouTooCanBeGuru
  7. 7. What's the difference between value and cost? @YouTooCanBeGuru
  8. 8. Answer: Profit. @YouTooCanBeGuru
  9. 9. What are your monthly recurring costs? @YouTooCanBeGuru
  10. 10. Website Hosting at Pressable $25 Postmatic (for content delivery and commenting) $20 Dropbox (for website & photo backups) $10 Backblaze (backup computer) $10 iTunes (cloud storage) $4 Hootsuite (manage client social accounts) $15 Freshbooks (invoicing clients) $25 Canva.com (making graphics) $15 @YouTooCanBeGuru Here are my monthly SaaS costs rounded to the nearest dollar:
  11. 11. Cable $97 Cell Phone $99 Electricity $40 Home Office $350 @YouTooCanBeGuru Here are my monthly business/office costs rounded to the nearest dollar:
  12. 12. $710 @YouTooCanBeGuru Total Monthly Costs *This does not include my own wages to myself or health insurance.
  13. 13. Health Insurance $400 40 Hours at $75 an hour = $3000 @YouTooCanBeGuru More monthly costs:
  14. 14. $4110 @YouTooCanBeGuru Business Monthly Cost *This does not include self- employement taxes or income taxes.
  15. 15. How much profit do you want to make? @YouTooCanBeGuru
  16. 16. You have to figure that out. @YouTooCanBeGuru
  17. 17. Take a desired salary, reverse engineer taxes. @YouTooCanBeGuru
  18. 18. @YouTooCanBeGuru
  19. 19. You could also divide cost by 40 hours, mark up by 25%, and estimate time for the job. @YouTooCanBeGuru
  20. 20. $4,110 / 40 = $102.75 $102.75 * 1.25 = $128.43 @YouTooCanBeGuru
  21. 21. Now you know your BASELINE Value. @YouTooCanBeGuru
  22. 22. There's more than one way to find your value. @YouTooCanBeGuru
  23. 23. Who is going to start a Google Sheet Monday? @YouTooCanBeGuru
  24. 24. @YouTooCanBeGuru