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“How much should I charge for my coaching services?”
This is a question we hear very often from our coaches in training. There’s no one-size-fits-all answer to this question. However there are some methods to calculate the coaching fee you want to ask. In this article we are going to present 2 methods to calculate the fee you can to start with, and we’ll also share one way you can optimise your fee to make sure you are not undercharging your clients.
Just a note that we will illustrate each method with an example. We’re not using any specific currency for the numbers we’ll use as our website’s audience is global.
The first method is to look at what you are willing to pay yourself as a client.
When you need a coach, and the coach is offering a similar pricing structure as yours, how much is okay for you? And how much is too much?
The best way to feel confident about the price you can charge is to simply start with the maximum price you’re willing to pay as a client.
Here we are not starting with the hourly fee you would charge, but with how much you want to earn at the end of the month.
Start by listing all your business expenses:
This will show you the minimum required to cover your monthly/yearly expenses.
Let’s use an example and say that the amount of expenses is 500.
Now, look at how much you want to take from your business for yourself; not the business revenue, but the actual pay you want to receive at the end of the month.
For our example, let’s say that the coach wants to receive a monthly wage of 3,500.
Simply add your business expenses and the monthly wage you hope to get.
That’s 500 + 3,500 = 4,000 of monthly revenue needed to cover all expenses and the coach’s wage.
You will never coach 40 hours a week, that’s simply not mentally and physically possible; the fee that your clients pay needs to reflect the work you do outside of sessions as well. We encourage you to think about the number of clients you want to work with, instead of the number of hours you have available during the day. We’ll show you why below.
In this example, the coach reviews their schedule. They are available 4 days a week, 9am to 5pm, with a lunch break of 1 hour. That’s 7 hours a day for 4 days = 28 hours.
But the coach will not be able to do 7 hours of coaching per day. That would mean doing back-to-back sessions 4 days in a row, which is not feasible without burning out. Let’s say they will need 30 minutes between sessions. Taking this into consideration, they will actually be able to do two 1-hour sessions in the morning and 3 in this afternoon (or 3 in the morning and 2 in the afternoon, depending on their lunch break). That’s 5 hours maximum of coaching per day; 5 x 4 = 20 hours available per week.
If the coach divides the weekly revenue (4,000/4 weeks = 1,000) by the hours they have available every week (20), that gives them an hourly fee of 1,000/20 = 50 per hour.
The questions now is: do you really want to work with 20 clients every week? Knowing all the work that needs to be completed before and after sessions? The idea of having loads of clients sounds great, but the reality is different: facilitating 20 hours of coaching per week with 20 different clients is a lot. With this fee of 50 an hour, the coach has to have 20 clients to meet their revenue goal.
That’s why the way we recommend to calculate your starting fee based on the number of clients you want to work with.
Now let’s go back to our example.
The coach’s goal is to earn 4,000 per month. They want to work with 8 clients at a time, on a weekly basis. That’s a monthly fee per client of 4,000/8 = 500. If we look at a weekly fee, that’s 500/4 = 125 per week/session. 2.5 times the fee calculated based on their availability.
With a fee per client, you can choose to present it as a monthly retainer or a package of sessions.
These calculations are based on individual sessions. You can also choose to offer group coaching, which is usually less expensive for clients than 1:1 sessions, but it allows the coach to earn more per hour since they’re working with several clients at a time.
Methods 1 & 2 are ways to help you decide your starting fee. The last method we are going to cover is one that you need to use on a regular basis, regardless of how you decided your fee.
The idea is simple: increase your fee until a few potential clients start complaining about it and don’t sign up because of that. It may sound counter-intuitive, but the increased revenue you will make from clients who are willing to pay your fee will compensate the few who don’t.
Let’s go back to our previous example with the coach who wants to work with 8 clients on a weekly basis and who calculated their starting fee at 500 per month. They increase their fee incrementally and start seeing some resistance from people when they’re told the monthly fee for coaching is 700. They even lose 2 clients.
The coach makes more money with less clients, and they even have availability for two more.
How often should you increase your fee? It’s up to you – as often as you want. Start by doing every 6 months and see if this is adequate.
By how much should you increase the fee each time? Up to you! Play with numbers to see what feels right. The idea is to do it incrementally to avoid asking a 50% increase in one go to your clients. You don’t want to scare them away.
Remember that you can always adjust your fee up and down whenever you want.
What do you think of these methods? Is there any that feels adequate for you and that you could start using?
Many coaches, especially those who are starting their practice, feel a bit lost when it comes to charging clients. Lost, guilty, self-conscious. You have to make a living of your professional activity, not just to survive, but to thrive in your personal life. Charging the right amount is essential to sustain your coaching practice and support more and more people. We hope that this article supports you in getting the reflection started on the right fee for your coaching.
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