Proper pricing supports your livelihood and should balance your financial and emotional investments in your work. and helps retain customers and hold them accountable. Personal trainers sometimes underestimate their job as they tend to overlook or underestimate the time outside of training. Rest assured it is It is possible to remain a compassionate and caring personal trainer who wants to change life while recharging what you are worth.
Please follow the steps below to determine a reasonable price. As you do this, be patient with the process as it may require working back and forth between steps to determine your final pricing strategy.
Step 1: Identify the annual financial goal
Fitness can be your career or a part-time job for extra income. Regardless of your situation, setting a financial goal is the first step in creating a business plan. When setting your financial goal, it̵
revenue is the amount of money you generate by selling services and / or products.
Benefit is the remaining amount when you deduct from income the expenses you pay to run your business. This is the amount of money that you actually make.
The goal you want to identify is how much you want to “earn” each year – that is, your goal benefit.
Step 2: estimate costs
By determining how much it costs to run your business, you can determine how much to charge per training session in order for you to meet your financial goal.
Start by estimating your expenses, ie the fees (one-time or recurring) that you will incur creating, marketing, selling, and providing services to customers. Once you are up and running, you need to carefully track spending and adjust your prices to match the actual numbers.
Make a list of the expected expenses, which may include some or all of the following: professional development (e.g. certification, renewal, specialty certification, and education), production tools (e.g. tablet or handheld device, software) , Exercise equipment (e.g. resistance bands, dumbbells and stability balls), set-up costs (e.g. rent, utilities, and internet), sales and marketing resources (e.g. software and advertising spending), and legal and business requirements (e.g. insurance and Accountant). Then add at least 10% to this estimate to account for unforeseen expenses.
Step 3: calculate how much to charge per billable hour
Now that you have calculated how much money you want to make and the base cost, you need to determine how much money you will have to charge customers per hour to get the profit you want.
To work out how much to charge per billable hour, start with your annual profit target (from step 1) and divide by 12 to find your monthly profit target.
- Example: $ 84,000 per year / 12 = $ 7,000 per month
Then use your estimated cost to calculate your monthly expenses.
- Example: The monthly spend calculated in step 2 is $ 1,100 per month
Then use the Estimated Costs (starting at step 2) to find your average monthly “cost”. Add the monthly cost to the profit target to determine how much money you need to make each month (in total sales, not in profit).
- Example: $ 7,000 + $ 1,100 = $ 8,100
Next, you need to determine the number of billable hours you have each month. First, determine how many hours per week you want to work and subtract 10-15% from the total. The 10 to 15% buffer is used to account for non-revenue generating functions such as marketing, scheduling, programming, and travel.
- For example, if you want to work full time, multiply 40 hours per week by 15% and subtract that number from 40 to get prices based on 34 billable hours per week. Then multiple times 34 x 4 = 136 for the total number of billable hours per month.
Divide monthly revenue by the number of billable hours per month to determine how much you need to charge per contact hour to meet your annual profit target.
- Example: $ 8,100 / $ 136 = $ 59.55 / hour (round up to $ 60.00 / hour) *
This personal trainer could expect revenue of approximately $ 97,200 per year (8,100 x $ 12) with a profit of approximately $ 84,000 by averaging $ 60.00 per billable hour.
* An additional consideration is taxes; both sales tax and self-employment tax. You should seek advice from an attorney about the implications of sales tax and self-employment tax in your state. When reviewing your pricing strategy, estimate the amount you will have to set aside for taxes and subtract that number from your revenue generation estimates to make sure you are meeting the financial goals you have set for yourself.
This exercise is designed to determine the amount of money you will need to generate per hour to meet your annual profit goal. If you are having one-on-one calls, this is the price of a session. However, it is possible to make more per hour by offering small-group training or creating programs that can be sold to clients to perform outside of your time together. By determining the average hourly rate required, you can evaluate these other services and find the best mix of products for you!
Remember, you are a professional and you deserve compensation for your work. Your pricing must take into account the time you spend marketing, communicating with customers, and designing programs. While it may be tempting to offer discounts or free training, it can decrease the perceived value of your services. On the other hand, it is up to you to deliver top quality service once you start charging a competitive rate. The good news is that if you set expectations at the beginning of the business relationship and then meet them, you can expect a long, rewarding, and lucrative career.