Articles for service business owners

 

5 steps to calculating your hourly rate

25th August 2014

Having an hourly labour charge places an actual price on your time.

An hourly rate will make working out what to charge for your labour a much easier task…

But how do you know what to charge per hour?

Here’s an easy way to work out how much you should be charging per hour:

  1. Write down the annual salary you want/need to earn. That’s your desired salary.
  2. Minus the number of holiday weeks you want each year from 52. That’s the number of weeks you’ll work each year.
  3. Divide your desired salary by the number of weeks you can work. That’s your weekly earnings target.
  4. How many hours do you want to work each week? Divide your weekly earnings target by the number of hours you want to work.
  5. That’s your hourly rate. Write it down and keep it in mind… Always aim for it!

When pricing new work, multiply your hourly rate by the estimated number of hours you estimate it’ll take to complete the work.

– – –


About the author

Co-founder and CEO of YourTradeBase.com. Helping organise service businesses and their paperwork. https://www.yourtradebase.com


Recent articles like this...

Enjoying this stuff? Find it useful?

Get it straight to your inbox — easy.

We'll send you a new article as soon as it's published.

Just enter your email below.

Ready to give YourTradebase a try?

Start your free trial today

Free day trial · no credit card required · cancel at anytime

YourTradebase is...
Built For The Trades

YourTradebase is built with by Forty Two Ltd.  Read our story  We're hiring!

Looking for the fine print? See our terms of use, privacy policy and GDPR

Stay in touch on Facebook, Twitter and YouTube

© Forty Two Ltd 2013 - 2018
Registered in England and Wales number 6972939