Here’s a hot one: the best pricing policies never assume every project will be immediately profitable on its own. As long as your profitability is good to great in most projects, one or two moderately unprofitable ones should not worry you. On the contrary, they are a sure sign that you are doing things correctly.

Healthy profits come from taking risks, and those who take risks sometimes fail. You can of course minimize risks in order to avoid them, but never without a significant premium.

For example, drivers who sign up for Uber get to avoid the risk of not being able to find customers whenever or wherever they want to work. On the other hand, they mostly get paid for their work and rarely get to earn any real profit. The profits Uber pockets are the premium the drivers pay for being relieved of the risk.

If you set your own pricing policies in a way that you should never end up having a single unpaid hour in any given project, you are probably overdoing it. You made it harder to fail, but at the same time made it harder to show what’s different about you, and get highly profitable projects.

Introduce a little more risk by, for example, sometimes giving guarantees, pricing per project, or putting some of your compensation at risk. This may sometimes make a single project unprofitable, but your whole business should end up much more profitable on balance.


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