How to price a service: the framework I wish I had three years ago
I lost €11,400 in my first year of freelancing. Not because I had no clients—because I priced like a coward. I quoted €35/hour for web development, worked 60-hour weeks, and still couldn't cover rent in a mid-sized French city. The math never worked. I just didn't want to look at it.
Pricing a service isn't about picking a number that feels fair. It's about building a structure that survives contact with reality: taxes, slow months, the client who ghosts you after a two-hour discovery call. Here's how I do it now, and how you can steal the method without repeating my €11,400 mistake.
Key takeaways
- Your hourly rate is a floor, not a strategy—it covers costs, not value.
- Calculate your real billable days: most freelancers overestimate them by 30–40%.
- Auto-entrepreneur status changes the math: you can't deduct VAT or most expenses, so your floor price must absorb that.
- Test prices in increments of 10–15%, not 50%. Clients notice jumps; they rarely notice drift.
- A service grid should have three tiers—cheap, standard, high-touch—so the middle one sells itself.
- Raise prices on new clients first. Existing clients get a 60-day warning, not a surprise.
How to set your price floor without guessing
Here's the thing: most pricing advice tells you to "know your costs." Fine. But nobody shows you the actual formula, and that's where people freeze up. I froze for months.
The formula I actually use
Annual target revenue = (fixed costs + variable costs + your desired salary + taxes + buffer) ÷ realistic billable days.
That last part is where it gets ugly. When I tracked my time for six months in 2023, I discovered I was billable about 14 days a month, not the 20 I assumed. Admin, prospecting, invoicing, the endless Slack threads with that one client—all unpaid. So my "€500/day" fantasy was really a €350/day reality.
A mistake I made early on: I counted 220 working days a year. Subtract 5 weeks of vacation, public holidays, sick days, and the 30% of time that's unbillable, and you're closer to 130–150 real billable days. That's the number to divide by. Not the optimistic one.
Why your auto-entrepreneur status breaks the classic advice
If you're registered as an auto-entrepreneur, the standard "add 30% for taxes" line doesn't hold. You pay social contributions on turnover, not profit—for most service activities in France that's around 21.2% (as of 2024, per URSSAF). You also can't deduct your laptop, your software subscriptions, or your coworking desk. Every euro of expense comes out of post-tax income.
So the floor moves. A freelancer in a traditional company structure and an auto-entrepreneur charging the same rate can take home very different amounts. If you're the latter, your quoted rate needs to bake in the stuff you can't write off.
- Traditional structure: fixed costs are deductible, VAT is recoverable, social charges hit profit.
- Auto-entrepreneur: fixed costs come from your pocket, VAT is not chargeable, social charges hit revenue.
- SARL / SASU: more admin, more flexibility on expenses, higher setup cost.
The takeaway isn't "pick the best status." It's: your floor price depends on your status, and pretending otherwise is how you end up working for free.
How do you choose between cost-plus and value-based pricing?
This is the question that kept me up at night for the first two years. Cost-plus says: figure out what it costs you, add a margin, done. Value-based says: figure out what it's worth to the client, charge accordingly. They lead to wildly different numbers.
Here's how I decide now.
When cost-plus wins
Commodity work with clear scope. If a client wants a website with five pages and a contact form, and there are 400 other people who can do exactly that, the value isn't in your craft—it's in delivery speed and reliability. Charge cost-plus. Compete on execution, not mystery.
Same goes for recurring administrative services—bookkeeping, payroll, data entry. The work is measurable, the deliverable is predictable, and clients know the market rate to the euro.
When value-based wins
Anything where the outcome is fuzzy but the stakes are high. A consultant who helps a SaaS company cut churn from 6% to 3% isn't selling hours—they're selling a number. If that number is worth €200,000 a year in retained revenue, quoting €8,000 for the project is cheap, not expensive.
I once quoted €2,500 for a strategy doc that took me three days. Client signed in 20 minutes. Later I found out the same deliverable had been priced at €12,000 by another agency. I left money on the table because I priced my time, not their problem.
| Factor | Cost-plus pricing | Value-based pricing |
|---|---|---|
| Best for | Commodity, repeatable work | Strategic, outcome-driven work |
| How you set the number | Costs + margin ÷ billable days | Client's economic upside |
| Negotiation anchor | Hours, deliverables | Results, avoided losses |
| Risk | Race to the bottom | Client can't see the value |
| Typical margin | 20–40% | 60–200%+ |
The rule I follow: if the client can easily compare you to three others, cost-plus. If they can't, value-based. Your job is to be incomparable.
How to build a price grid that actually sells
A "grille tarifaire" isn't a menu. It's a decision-making tool. Most freelancers I've worked with hand over a single price and wonder why clients push back. Of course they push back—there's nothing to compare against.
The three-tier structure
Give three options. Not two, not five. Three. Anchored low, positioned middle, priced high.
- Essential: the minimum viable version. Stripped scope, slower turnaround, async-only communication. Priced so cheap it feels almost unfair.
- Standard: what 70% of clients should pick. Full scope, normal timeline, one live call per week.
- Premium: same deliverable plus speed, plus priority access, plus whatever the client actually values. Priced 2–3× the Standard. Rarely bought—that's fine. It exists to make Standard look reasonable.
I've run this structure on every project since 2022. In my experience, roughly 15% choose Essential, 70% Standard, 15% Premium. The Premium tier makes more money per sale than Essential even though fewer people buy it.
Why fixed packages often beat hourly
Clients hate hourly because they can't predict the invoice. You hate hourly because it punishes you for getting faster. Fixed-price packages fix both. Once you know a deliverable takes 12 hours on average, quote it as a package. If you do it in 9, that's your profit. If it takes 18, that's your lesson—scope more carefully next time.
How do you raise prices without losing clients?
I raised my rates three times in two years. Lost two clients out of 19. Both were already the lowest-margin ones.
The increment rule
Raise prices 10–15% at a time. Not 40%. A jump that big forces every client to renegotiate from scratch, and most will walk. A 12% raise barely registers—it's roughly the inflation rate, and you can frame it that way without lying.
For new clients, no warning needed—just quote the new price and see what happens. If you lose 30% of deals on price, you raised too fast. If you lose zero, you're leaving money on the table.
Handling the "what if I lose them?" question
You will lose some. That's the point. I keep a spreadsheet with each client's hourly-equivalent rate. When I raise prices, the bottom 20% usually resists. Sometimes I let them go. Every single time, a better-fit client showed up within 8 weeks. Every time.
Practical steps:
- Send new pricing 60 days before it takes effect. Not 7.
- Grandfather loyal clients for one extra cycle if you can afford it. Goodwill compounds.
- Offer a smaller-scope option at the old price instead of a discount on the same scope.
- If they push back hard, ask what specifically changed about their budget. Sometimes it's real. Sometimes it's a bluff.
Any price increase feels terrifying in the week before you send it. Six months later, you wonder why you didn't do it a year earlier.
What does a pricing grid look like per industry?
Rates vary wildly depending on the vertical. Here's what I've observed across industries I've worked with or quoted against, in France and adjacent markets.
| Service type | Typical rate (2024) | Pricing model |
|---|---|---|
| Administrative (bookkeeping, invoicing) | €30–60/hour, or €400–900/month retainer | Hourly or monthly package |
| Web / digital freelance | €350–700/day | Daily rate or fixed project |
| Aesthetic services (beauty, wellness) | €50–120/session | Per session, with package discounts |
| Agricultural services (seasonal labor, consulting) | €15–35/hour or per-hectare | Hourly or output-based |
| Strategy consulting | €800–2,500/day | Daily rate or value-based project |
These are ranges I've seen, not official figures. The point isn't to copy a number. It's to notice that the pricing model matters as much as the price. A beauty salon charging per session has a completely different economics than a consultant charging per day. Match the model to how the client thinks about value.
The two questions that save me every time
Before I quote anything, I ask myself two things:
One: What's the client's cost of not solving this? If it's zero, my price is bounded tight. If it's high, I have room.
Two: What's the highest number I could say out loud without flinching? Then I add 20%. The flinch is the tell. It means I'm still pricing from fear, not from arithmetic.
Pricing a service well isn't a formula you crack once and forget. It's a practice. You'll get it wrong. Clients will push back. Some will leave. But the alternative—staying at €35/hour forever because you're afraid to test—isn't safer. It's just slower. And the years you spend underpriced don't come back.
Start with the floor. Then figure out where the ceiling actually is. You'll probably find it's higher than you thought, and lower than the person next to you is charging. Somewhere in that gap is your number.
