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  1. #1
    Join Date
    Mar 2004

    How much should I charge?


    I know that businesses can pay anywhere from $2.99 to $75 per month for hosting a dynamic database enabled website.

    I would like some help in making a good management decision on how much to charge.

    I offer 24/7 telephone toll-free support (without long hold times) and I guarantee uptime. So it is a high-end service.

    If I charge too little I won't make very much money but if I charge too much I won't make very much money either because I won't have many customers....

    So, does anyone know where I could get price-point research that would help me make a good decision?


  2. #2
    Join Date
    Oct 2002
    State of Disbelief
    Create a business plan, charge what it's worth. Don't rely on random suggestions from your competitors on a forum to base your business' future on.

  3. #3
    Join Date
    Sep 2003
    You'll need to consider your costs first, add a profit margin on top of that and consider costs required for future investment.

    Find a target audience, and research the current going rate along with demand and you should be able to come up with an accurate price to list..
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  4. #4
    Join Date
    May 2004
    Central Scotland
    All the above is great advice. First thing you should do is find the price it'll cost you to run a server. Then do you have an office with overheads? Add all that together. Now concider how you will advertise your company and how many will it cost? Add that on top, server hardening is something that should be handled by a professional, as you're putting others at risk if your server is insecure. Not only can this be expensive, it can be even more expensive if you don't do it and a client takes legal action.

    Already you can see it's costing a lot of money, so you need to make a sales forecast. How many sales will you make in your first month? 10, 20, 30? more? You need to divide your forecast of sales by how much it's going to cost to get a base figure.

    Now that you have your base figure, you need to add something on top. 40% is usually about fair. You should now have a figure for what a basic package will cost you. Does it seem reasonable to you for people to pay that? If No.. give up and go back to the drawing board. If yes, carry on determining what you are prepared to give for that price and there is your first package. Then add more to that package add 40% there is your second package. Then add more to that account and add 37% there is your third.. and keep adding, and taking off 3% of the last package cost increase (ie 37% would become 34% then increase your last package by 34%).


    package 1 = $37.96 (total cost per month divided by forecast of sales per month)
    package 2 = $53.14 ($37.96 + 40%)
    package 3 = $72.81 ($53.14 + 37%)
    package 4 = $97.56 ($72.81 + 34%)

    This isn't actually based on anything at all it was a random number to start with. It makes it more logical, and all you have to do is concider what you want to give spec wise to match the price.
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  5. #5
    Join Date
    Jan 2005
    Richmond, VA
    Who's your target market? That would be the best determiner of price.
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  6. #6
    Join Date
    Jan 2006
    Ontario, Canada
    The easiest way to find out, is ask!

    Create a survey for your potential market and find out exactly what businesses would be willing to pay, or believe is fair. - Gameing discussion, arcade, all around good fun

  7. #7
    Join Date
    Mar 2004
    Thank you all for your thoughts and ideas.

  8. #8
    I'd like to support ideas above, youe decision should be based on two factors: your package prices should be high enough for you to live on and low enough for you not to lag behind your competitors. Good luck!

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