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Simple Calculators

Service Pricing Calculator

Find your minimum viable rate, recommended pricing, and annual revenue projection for any service business — consultants, coaches, tutors, trainers, and therapists.

Cost Structure

Your time cost — salary equivalent per hour

Insurance, software, admin, space

Typical service businesses: 20–40%

Cancellation & No-Show Rates

% of sessions cancelled in advance

% of sessions where client doesn't show

Revenue Projection

Related calculators

All business

Quick summary

Service business pricing starts with your cost to deliver (your time value + overhead) and adds a profit margin. Then adjust upward to account for cancellations and no-shows — those empty time slots still cost you money. The effective rate tells you what you actually need to charge to hit your income goals.

Reviewed by Simple Calculators TeamLast reviewed

How to use this calculator

  1. Enter the inputs requested by the calculator.
  2. Choose the units or options that match your situation and review the assumptions.
  3. Run or update the calculation to see the result.
  4. Review the result, breakdown, and formulas shown on the page.
  5. Check the inputs, units, dates, and limitations before saving or sharing the result.

Service Pricing Formulas

Minimum Viable Rate

Minimum Rate=Delivery Cost/hr+Overhead/hr\text{Minimum Rate} = \text{Delivery Cost/hr} + \text{Overhead/hr}
Delivery Cost/hr
Your time cost — equivalent hourly wage you need to earn
Overhead/hr
Insurance, software, admin, and other indirect costs per session hour

Worked example

$30 delivery cost + $15 overhead

Given
Delivery Cost = $30/hr
Overhead = $15/hr
Calculation
30+1530 + 15
Result
$45/hr minimum viable rate

Recommended Rate

Recommended Rate=Total Cost/hr1−Profit Margin\text{Recommended Rate} = \frac{\text{Total Cost/hr}}{1 - \text{Profit Margin}}
Profit Margin
Target profit margin as a decimal (e.g., 0.30 for 30%)

Worked example

$45/hr costs, 30% profit target

Given
Cost/hr = $45
Margin = 30%
Calculation
451−0.30\frac{45}{1 - 0.30}
Result
$64.29/hr recommended rate

Effective Rate (Accounting for Cancellations)

Effective Rate=Recommended Rate1−(Cancel%+No-show%)\text{Effective Rate} = \frac{\text{Recommended Rate}}{1 - (\text{Cancel\%} + \text{No-show\%})}
Cancel%
Percentage of sessions cancelled in advance
No-show%
Percentage of sessions where client doesn't appear

Worked example

$64/hr rate, 10% cancellation + 5% no-show

Given
Rate = $64.29/hr
Loss = 15%
Calculation
64.291−0.15\frac{64.29}{1 - 0.15}
Result
$75.64/hr effective rate needed

Frequently asked questions

How do I calculate my minimum viable service rate?

Add your hourly delivery cost (what your time is worth) to your overhead per hour (insurance, software, marketing, admin). This is your break-even rate. Charging below this means you lose money on every session.

What profit margin should a service business target?

Most service businesses target 20–40% profit margins. Coaches, tutors, and trainers often aim for 30–35%. Consultants typically target 35–50% since their rates are higher. Therapists and licensed professionals may target lower margins initially to build clientele.

How much do cancellations really cost my business?

A lot. If 15% of your sessions cancel or no-show, you need to charge 17.6% more per paid session to hit the same income. On a $100/session rate, that's an extra $17.60 needed. Build a cancellation policy (24-hour notice, 50% fee) to protect revenue.

How should I set overhead per hour?

Take your annual overhead costs (malpractice insurance, software, continuing education, marketing, admin tools) and divide by your total session hours per year. For a coach with $6,000/year overhead working 20 client hours/week × 50 weeks = 1,000 hours: $6,000 / 1,000 = $6/hr overhead.

Key terms

Minimum Viable Rate
The lowest hourly rate that covers all costs without profit — your break-even point
Effective Rate
The rate you need to charge per paid session to hit income goals after accounting for cancellations and no-shows
Delivery Cost
The cost of your time to deliver the service, equivalent to an hourly wage you could earn elsewhere
Overhead per Hour
Indirect business costs allocated to each service hour: insurance, software, marketing, admin

Methodology, sources & limitations

This page shows the formula, assumptions, and limitations used for this estimate. Rates, thresholds, and other time-sensitive inputs can change, so verify them against the relevant official source before relying on a result.

For our review approach and the primary sources we consult, see the methodology and source policy. If you spot an outdated figure or formula, please contact us with a correction.