Trying to determine the best price for your event planning service can be complicated, especially when you’re new in the industry. Even more, trying to determine if you should raise your prices, can be even more difficult.
I’m sharing 3 things to consider when trying to determine if you should raise your prices. As well as a bonus pricing calculator to help you determine your BEST hourly rate.
1. Are you Making a Profit?
Before you raise your price one of the key questions you need to ask yourself is, are you actually profitable. If you’re running your business efficiently, you should know your revenue and expenses and exactly where your profit stands.
Quick Recap: Revenue – Expenses = Profit
If after calculating your revenue and expenses your profit is lower than anticipated, then it is time to raise your prices. Look at your hourly rate as well as your event planning package prices to see what can be changed.
Maybe your current packages include a lot more than you’re articulating on your website or to clients. It’s time to update your content and raise your price. This way, should a client ask about your price change, you can confidently explain what service you provide and what’s included in your package for your new price.
If you’re not currently tracking your review and expenses, this is definitely the time to start. The best way to know your starting point is to have a record.
I recommend starting with an accounting program such as Wave or even downloading a free spreadsheet, such as this one from Capterra.
2. How do you Compare to your Competitors?
Be cautious with this one.
What I want you to do here is not raise your prices to match your competitors, but rather use your competitors as a gauge for where your prices should be.
What do I mean by that?
Look around at your competitor’s prices to see where they are. If you find that your prices are significantly lower than the average, then it’s definitely time to raise your prices.
If after your research you find that your competitors are about the same price as you, then you don’t have much to worry about. Unless you’re not making a profit (See #1).
But what happens if your competitor’s prices are lower than yours?
In this case, I want you to compare your packages. Are they offering the same product, service, and options like you? If not, then you do not need to change your prices. The reason for this is that because another company’s price is lower and they are in the same industry does not mean you provide the same service. Maybe you lay out the red carpet service for your clients and deliver a high-end client experience, while they offer the Walmart model – quick and cheap. Should those services be the same price? Definitely not.
But that being said, it’s important that this is articulated to potential clients and that it is clear in all your marketing materials.
3. Are your pricing for value?
This is where a lot of event planners and wedding planners miss the spot. Value pricing is a tricky one because it essentially tells you to price on what your service is valued at not what it’s cost.
Let’s say you provide a premium high-end event planning service that you can price at $3000 and still make a profit. But your service is so good that clients would be willing to pay $6000 for it.
Using the value pricing method, your prices really should be $6000. This captures not only your cost and time but also the value that you provide to clients.
If you’re not currently pricing for value, review your packages and see if this is something that needs to be changed.
One of the biggest signs that your value pricing is off usually happens when client after client will say something like this to you “OMG, you went above and beyond for our event. Honestly, I would have paid double to work with you again…”
If you’re hearing statements like those, then it’s time to raise your prices.
Free Download: Event Pricing Calculator
If you’re new in the events industry and unsure of if your prices are where they should be, download my free pricing calculator and guide to get started.
Is it time to Raise Your Prices?
Pricing is never an easy task or decision whether your new or have been in the event planning industry for a while. There will always be a period of trial and error to get to that perfect price. But the most important thing to do as a business owner is always know your numbers and keep reviewing your prices periodically to ensure they are where they should be.
