TOOLS / FOR SELLERS

Price the outcome, not the hours

If your work makes a client money, hours are the wrong yardstick. Start from the value you create and capture a fair slice of it.

$
Extra revenue, savings, or risk avoided that your work drives in a year.
%
A fair capture rate is usually 10–20%. It's your slice, not the whole pie.
Your honest estimate, including revisions and calls.
$
The rate below which working loses money.
SUGGESTED PROJECT PRICE$—
HOURLY FLOOR FOR THIS JOB$—
EFFECTIVE HOURLY$—

How this is calculated

The suggested price is the value your work creates times the share you capture:value × capture%. The floor is your hours times your minimum rate, and the effective hourly is the suggested price divided by those same hours. When the effective hourly beats your floor, value-based pricing is paying off. When it doesn't, either the outcome is too small to price this way or your capture rate is too timid.

The value figure is yours to defend — this tool never invents it. Get it from the client in discovery: what does the result actually move for them? The reasoning behind charging on outcomes lives inhow to price your services, and the mechanics of the method are in the value-based pricing glossary entry. To set the floor this checks against, run the freelance rate calculator.