The Ethics of Setting Your Prices

Over at Men With Pens the other day, I saw a post that took an interesting take on the issue of what to charge. It got me thinking.

We all struggle with what to charge. And naturally, we all want to make as much money as possible. Most "what to charge" advice, including from the writers-who-started-it-all Bob Bly and Peter Bowerman, is geared toward how to charge more. No thought is given to whether or not it's right or wrong. The prices you charge are a business decision, and a wider morality shouldn't factor too heavily into your pricing. You're running a business, after all--not a charity.

In the writing community, there's definitely an attitude that it's actually "wrong" from a moral standpoint to charge less. There's a good reason for this: so many, many people charge next to nothing for their work that it undermines the community as a whole. The theory goes that when you do an entire website rewrite for $20, it makes it more difficult for me to charge $2,000 for the same service. Of course, you do get what you pay for--and a $20 website will be much different than a $2,000 website. But some clients see only the number of zeroes after the 2--and that brings the writing economy as a whole down. It's a tough world out there, the logic goes--and writers have to maintain solidarity by not giving the work away.

I absolutely believe we should all charge what we're worth. But is there an ethical side to setting prices? The way I set my prices is a personal decision mainly guided by what I need to earn. I don't think I'm the most expensive guy on the block, but I'm not the cheapest, either--and I don't generally worry about what others charge when I set my prices. I choose prices that work for me. However, there are some situations where I will think about what the person I'm working with needs to pay. Here they are:

When it's a nonprofit. There are some causes I believe in very strongly, and I'll work with those nonprofits for a reduced price. In some cases I'm willing to give small projects away for free. I can't afford to do this with larger projects, simply because of the time involved--but I do offer a reduced rate for them.

When it's family or friends. Okay, I admit it--my friends and family get my services for free. I've written my dad's business brochure, my boyfriend's resume (and the resumes of many of his and my friends), my brother's website bio, and provided proofreading and editing for countless other projects free of charge, mainly because it's my little brother or main squeeze or best-friend-since-birth asking. Maybe some would say I should charge, but I like being able to do this for them for free.

When it's a small company with a small budget. Okay, this one's a little different. I don't reduce my prices for every budget-conscious small business that comes along. But if I make a quote and the prospect tells me it's too high, I'll work with them. I'll suggest ways they can save money with me--by writing the copy themselves and having me rewrite it; by providing me with an outline and all research materials; or by cutting back on length or other specifications.

Naturally, you need to set prices that work for your business--and you want to make as much as possible. But there are ways to work in your ethics, too--and work with small, budget-conscious clients without giving away the farm. If you can do it successfully, hopefully they'll come back with more once they've grown.