Stop Undervaluing Your Services

Imagine you're just starting as a freelancer. You're a software engineer, designer, or coach eager to offer your skills on a platform like Upwork or Fiverr, but you hit a wall almost immediately—how do you price your services? This is among the most common questions for anyone new to Service Street. Let's explore how to tackle this challenge effectively and avoid some common pitfalls that can keep your business from thriving.

The First Step: Learn from the Market

The simplest way to figure out what your skills are worth is to look at the market from the client's perspective. Browse Fiverr, Upwork, and other platforms to check out existing offers and see what others with similar skills charge. This will give you a baseline, a sense of what is considered “normal” for your level of expertise. This is your first data point—a useful starting point to understand where you stand in the current marketplace. But it doesn’t stop here.

Don’t Base Your Prices on Costs

A common mistake in the service industry is setting prices based on costs. Freelancers think about what they need to survive: "I need to charge this much because my living expenses are X." But this is a race to the bottom. When you compete on price alone, you position yourself as a commodity—interchangeable and easily undercut.

Instead, shift your focus to the value you provide. Why does the client need your service? What problem are you solving for them? For example, if a client needs a website designed quickly for an upcoming event that could generate new leads, your price should reflect the value of that opportunity—not just the hours you put into building it. Make your pricing about what it’s worth to them, not what it costs you.

Say No to Discounts

Here's a rule: I live by either free or premium. And premium means charging a higher price. Discounts create a host of problems. If your existing clients find out someone else got a discount, they may feel slighted or undervalued, souring your relationships. Moreover, a discount usually signals to a client that you don't believe in the value of your service. And if you don’t believe it, why should they?

When a client says they’re on a budget, don’t lower your rate—reduce the volume of work. If you usually work five days a week for a client but their budget only covers three, keep your daily rate the same but work fewer days. That way, you maintain your perceived value and avoid feeling resentful. It is also a better negotiation position once your client can afford higher rates.

Know When to Walk Away

Many people think that little money is better than no money. This mindset can lead to taking on poorly paying clients, which in turn makes it harder to find quality clients who respect your value. You don't have to say yes to every job. Rejecting a client who doesn’t see your worth can often be more profitable in the long run than accepting work at a rate that undermines your value. Remember, not all money is good money, and the opportunity cost of maintaining a low-value client is real.

The Surprising Power of Higher Prices

During my agency days, I discovered a counterintuitive truth: higher prices often attract better clients. While you might worry that charging more will scare clients away, the opposite is usually true. Higher prices signal confidence and quality, attracting less price-sensitive clients and more focused on value.

Clients who pay premium prices often don’t micromanage or quibble over invoices. They know they’re paying a premium and are more likely to trust your expertise. They have skin in the game and must justify to themselves that you’re worth it. In my experience, these clients are easier to work with and more profitable in the long run.

Takeaway: Your Price Is Your Position

Ultimately, your price is more than just a number; it’s a statement about your value and the clients you want to attract. Position yourself as a premium service provider who understands the value you bring. Don’t settle for being a budget option—because that’s a place from which it’s almost impossible to grow. There is an abundance of clients out there. You just have to find them.

When it comes to pricing, be bold and confident, and always remember: it's not about what your service costs you but what it’s worth to the client.