Setting a price is always difficult. First of all you need to know what it will cost you to get the job done (paper, toner or ink, labels, binding, machinery maintenance, phone service, insurance, utilities, etc.) These are your costs of doing business. Then you need to add a fair rate for your time. Add these together and you have your base price. If you charge less than this you are losing money! You also need to remember that there are many activities that you will need to do that do not directly generate revenue.

The more obvious of these include keeping your financial records, collecting stationery supplies from the local store and the looking for new clients and new business. You should factor in a charge to cover these activities. How much profit you can add to the price is usually determined by what clients expect or are willing to pay for the service based on other similar services they have obtained.

You will want to do a little research about competitors' pricing if you can. You can call them yourself or have someone else request the information. Either way, it is important to know what you are up against, as well as whether it is more usual to charge by character, by word or by line, by the page or by the hour.

Clients will inevitably try and negotiate the best prices and best terms for themselves. It is much easier to say no to reduced prices and extended terms if you have a printed price list or rate card. This should list the services you provide and the charge for each service. When negotiating avoid reducing the price for your work to win the business, not even a first contact. It is very difficult to justify charging a higher price later.

You should only consider a discount for large volumes of regular work. Watch out for the negotiating trick when you are asked, "what would you charge per letter for preparing l00 letters per week"? When you give the price they say "I accept that price but I only have five letters this week". Before you give a price ask the question do you have l00 letters every week or only occasionally. If you do quote a price stipulate that this is the price only when you prepare l00 or more letters per week and if there is less than l00 your standard prices will apply.

When considering the terms, particularly for new clients it is highly recommended that you either ask for 50% in advance and 50% on delivery or COD -- Cash On Delivery. This way you are always paid before you give the client the work. Be prepared with your invoice if your expect a business to cut you a check while you wait. This usually eliminates the need for debt collection, a time consuming and unpleasant task that is much better avoided. Clients giving you regular work may ask for terms. Suggest that you invoice them once a week and they pay you the following week (this is a reasonable request from a small business).

(A) THINGS TO THINK ABOUT

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