Pricing Your Work

Most freelancers underprice by a factor of two to five — here is how to fix that

Most freelancers and builders underprice their work by a factor of two to five.

Not because they are bad at it but because they price based on how long it takes to produce rather than how much it is worth to the person buying it. And because they are afraid of hearing no.

This lesson is about how to think about pricing, how to structure it, and how to use Claude to build a pricing model that reflects what you actually do.

The Wrong Way to Price

Hourly rate thinking: "This will take me 20 hours, so at $50 per hour I will charge $1,000."

The problem is that if you get faster at the work, which you will especially using Claude Code, you earn less per project. You are penalised for improving. And the client, knowing you are billing by the hour, will scrutinise every hour.

Lowest-I-think-they-will-accept thinking: "I will charge $800 and hope they say yes."

The problem is that this price is based on your anxiety and not on what the project is worth or what the market pays. People can sense when you are guessing, and low confidence in your own pricing signals low confidence in your work.

The Right Way to Think About Pricing

Price on value: what the outcome is worth to the client, not what the input costs you.

A website that generates two new client enquiries per month is worth more than the time it took to build it. An automation that saves someone eight hours of admin per week is worth the time it saves them compounding over a year.

You do not always have this data. But asking the question "what is this worth to them if it works?" is a better starting point than "how long will this take me?"

The Three Pricing Structures

Fixed project pricing is one price for a defined deliverable. Best for websites, landing pages, and specific apps with clear scope. Advantages include being predictable for both parties, not being penalised for speed, and forcing clear scope upfront. The risk is scope creep, so everything outside the original scope should be a new invoice. State this clearly in the proposal.

Retainer pricing is a fixed monthly fee for ongoing work, a defined number of hours, or a defined set of deliverables. Best for ongoing maintenance, content creation, long-term AI implementation work, and regular updates. Advantages include predictable income and a long-term client relationship where clients are more invested in the work succeeding.

Pilot pricing is a smaller, lower-cost first project that de-risks the relationship for both parties. Best for clients who are hesitant, large scope with uncertainty, or situations where trust needs to be built before a bigger engagement. Structure it as: "Let's start with [SMALL DEFINED SCOPE] for [LOWER PRICE]. If it works the way you need it to we will talk about the larger project."

Setting Your Prices Using Claude

Using @MARKETING.MD and @SALES.MD — help me think through pricing for my services.

My services: [WHAT YOU DO]

My audience: [FROM MARKETING.MD — who buys from me]

What I deliver: [SPECIFIC DELIVERABLES]
How long it takes me currently: [ROUGH TIME FOR EACH SERVICE]

I want to move from hourly to project-based pricing.

Help me:

1. Suggest a pricing range for each service based on the value to the client

and not my hourly rate, with an explanation of the reasoning

1. Suggest a retainer structure for ongoing work with this type of client
2. Suggest a pilot offering that lets me de-risk the first engagement
3. Identify the minimum I should accept for each service type and why
4. Flag any red flags that suggest I am underpricing or overpricing for this market

Be honest and direct and not reassuring. I would rather know if my pricing is wrong

than feel good about a price that loses me work.

Packaging Your Offers

Presenting one price is fine. Presenting three options is often better, not because the prospect will definitely choose the middle one though research suggests they often do, but because it changes the question from "should I buy?" to "which one should I buy?"

A simple three-package structure uses Starter, Core, and Full.

Using @SALES.MD — write a three-package pricing structure for [YOUR SERVICE].
My current single price or thinking: [YOUR CURRENT RATE OR ESTIMATE]

Create three packages (Starter, Core, and Full) that:

• Are clearly differentiated in scope and not just price
• Price the Core at approximately [YOUR CURRENT PRICE]
• Make the Starter attractive enough to be a real option and not a decoy
• Make the Full package actually valuable and not just "add $500 for a retainer"

For each package: name, price, 3 to 4 specific deliverables listed, and one-line

description of who it is for.

Discounting

Do not discount in the first conversation. If someone asks for a lower price immediately after hearing it, the right answer is not to lower the price. It is to ask a question: "Can you help me understand what you were expecting? That helps me know whether we are talking about a scope issue or a budget issue."

If it is a scope issue, propose a smaller version using the Starter package. The scope changes and the rate does not.

If it is genuinely a budget issue, either the Starter fits within budget or this is a disqualification. Discounting your full-scope project means you deliver the full project at a lower margin and feel resentful about it the whole time.

If you do discount for a referral, a first-time client, or a project that is particularly interesting, name the discount explicitly: "My standard price for this is $1,200. Because [REASON] I will do it for $900." Do not just lower the number without the conversation. The named discount has value. An unexplained lower number just signals that the original was not real.

Adding to SALES.md

## Pricing
[SERVICE 1] — [PRICE OR RANGE]
[SERVICE 2] — [PRICE OR RANGE]
[RETAINER] — [MONTHLY RATE FOR ONGOING WORK]
[PILOT OFFER] — [LOWER-COST ENTRY POINT]

My pricing floor (the minimum I accept for any engagement): [$]

On discounting: I do not discount scope. If budget is tight I propose the

Starter package. If Starter does not fit I disqualify.

Your Action Right Now

Write down your prices for everything you offer. Run the Claude pricing prompt to pressure-test them. Then write your three-package structure.

If you have been charging by the hour, decide on the fixed project price for your next three projects and tell the next prospect that price without apologising for it.