Let’s assume you have chosen to establish an errand service. It sounds like a lot of fun, really. Imagine all the interesting people you will meet while you are taking care of various chores and services. It sounds like it could be something where most of the enjoyment will come from the daily interaction with others.
However, you still need to keep a business attitude and determine a rate structure in order to be successful. Here’s how to set your senior errand service rates.
Two best rate options
You really have just two options. You can charge per errand or you could charge per hour. Depending on where you live and the kinds of errands you will be hired to do, one or the other will be the logical choice. But what rate will you charge for your service?
Again, this will depend a great deal on what the market can bear in your specific region however, for some kind of measuring guide, rates gathered in a survey of national errand service rates ranged between $20 and $35 per hour with a average national rate of $30.00 per hour.
This is a great base to start with as there will be places and client you will be servicing where your hourly rate will not be quite enough. For example, for trips outside of the zone you determine as being ‘local’ you can tack on an additional mileage fee. Using the guidelines set by the IRS of 58-cents per mile as a recognized business-related travel deduction, you can use that in your service rates.
Everyone loves a discount
If you have regular customers you may want to offer some kind of incentive to them to keep their business coming to you. A package price or tier system based on the number of runs you will make can prove to be an affordable and attractive system.
The standard discount for package rates is 10-percent but you can be as flexible as you need to be with that. The packages you create can range in value and volume of trips so for something like a top level package for $200 that could include up to 10-hours of service per month. Building you packages based on hours makes it easy for tracking for both parties so that there is a clear understanding of the limits that are in place.
Surcharges
What about after hours, short-notice or on your usual day(s) off? You will want to be able to keep serving customers but it is not unreasonable to add an extra fee or surcharge for services that fall outside of your normal hours of operation. For this you can add anywhere between an extra $5 and $10 per hour surcharge.
The same goes for holidays. You should be able to add a slight increase to your rates for work that takes place during a normally recognized holiday. You will also have to consider those errands that don’t total a full hour. Will you round up or down to the nearest hour or half-hour? Again, that is your decision but it is common to see errand service rates rounded-up to the nearest quarter hour.
Plus, you should have a minimum rate in place for errands that don’t fill at least 30-minutes of your time. Surcharges can be added to cancellations (if they are not within a reasonable time frame) and for checks or payments that fail to go through.
Getting paid
You may wish to set up a system where payment is due upon completion of the errands for the day and determine what payment methods you are comfortable with. Cash, checks and money orders are common. You may wish to explore debit payments and online payments if these are tools you are familiar using and if you have clients requesting these options.
Don’t forget to offer Gift Certificates as that is another way of expanding you services to new potential customers. You may even wish to include standard discounted rates for other seniors and new mothers or some other demographic within your community you feel you would like to give a break to.
Discounts to build your errand service business
You could offer a discount if someone refers a new customer to you or a discounted group rate if more than one neighbor got together to use your services on a regular basis. And another excellent way to build business and thank customers for using your errand business is to give them a discount for pre-payment. It is a great way to increase cash flow instantly and most will jump at the opportunity to save money before you do any work!
As you can see, setting senior errand service rates can have a lot of different variables. The key to success with this kind of business is to find the right rate for your area and the kind of customers you serve. You don’t want to charge too much and see little business, but you still don’t want to be running around wearing yourself out for little money. To discover more tips and insider secrets, plus dozens of other senior service you can profit from, read Start Your Own Senior Concierge Service.