How do you price a new product/service?

Data Swami

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    I’m looking for some pricing feedback in relation to solopreneurs, consultants, one-person businesses and very small teams.

    Over the last six months, I’ve spent a lot of time working through errors, wasted usage, unnecessary costs and various blind alleys to get my Hermes Agent setup working as well as it currently can and connected to all the different things i need it to be. Ive had interest from a few people as to how I have put it all together so far as ive shown some of the things I have developed for clients with it etc and going to look to them to see about how to price it too.

    Now it’s properly configured, it’s far more powerful and flexible than simply using something like Claude Code or Cowork on its own. It can handle much broader work, create and develop projects, and has controls in place to stop someone burning through all their usage in an afternoon.

    Most small business owners won’t have the time or inclination to go through the same learning curve, so I’m considering offering it as a done-for-you setup.

    I would install and optimise the full environment, then provide ongoing hosting, maintenance, fixes, improvements and coaching. The coaching is a big part of it: showing the owner how to use their “digital employee” get the most out of them and helping them apply it to their own work and processes.

    Based on my initial research of UK and US market and whats available in the market I'm currently considering:

    Setup: somewhere between £1000 and £2,500

    Coaching, hosting and support: between £500 and £750 per month


    £1000 feels too low for the setup, but £2,500 may be too high for the audience.

    Likewise, £500–£750 per month feels reasonable for the hosting, maintenance, optimisation, fixes and hands-on guidance, but I’m unsure where the right point is.

    Looking purely at the value and pricing, where would you place it?

    Am i overthinking this or would the setup be a bit too over the top for this sort of client profile?
     
    Who is your target customer?

    What will the product/service save (in time ot money)?

    Where are the competitors (price wise) and who are they?

    What are your goals - volume or value?
     
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    You are effectively looking at two standard commercial pricing models here, and you should probably run the numbers on both to see where they land.

    1. Value-based pricing
    This is the standard approach for specialised tech and service deliverables. You start by defining your ideal customer profile (ICP) and mapping out the exact economic benefit your setup provides. At the end of the day, for a small business, that comes down to whether it substantially lowers operational costs, improves throughput/productivity, or removes a major bottleneck.

    Once you have a clear, quantifiable value proposition, you price based on a percentage of that captured value. If your setup saves or generates a significant amount of money for them, your pricing should reflect that outcome rather than the hours spent setting it up. Try testing this value-led pitch on a few prospective clients to gauge reaction.

    2. Cost-plus & break-even analysis
    The alternative standard method is bottom-up financial modelling. Map out every single direct and indirect cost associated with delivering and supporting the offer, including API usage, infrastructure, software overheads, ongoing support time, and your target margin/salary.

    From there, project your anticipated unit sales/client volume for the fiscal year to establish your break-even point per client, then add your required profit margin on top. This gives you your absolute pricing floor.

    Comparing the figure you get from a bottom-up cost model against what the market will bear under a value-based model usually makes it fairly obvious where your pricing needs to sit.
     
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    What is this product/service? Why does a bloke cleaning windows need it? How will it help someone selling tag on eBay?

    Can they even afford your services?
     
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    Who is your target customer?

    What will the product/service save (in time ot money)?

    Where are the competitors (price wise) and who are they?

    What are your goals - volume or value?
    So target would be solopreneurs/one man bands more the coaching people, consultants that sort of frame as wasnt sure if it really fits for say a one man band plumber etc.

    Main thing is saves is time and potentially money depending on what they build with it to get rid of whatever additional subscriptions they might have with X SSAS product to do stuff but then also can be used as a idea bouncer too as it will have all their business info in there

    Competitor wise there are basic GPT and Claude agent setups but not really anything like this. Ive only seen one other attempt something like this all built in claude

    Main goal is value delivered this isnt some generic AI agent to just push out rubbish slop. Its there as a proper tool to help them automate parts of their business but in a guided and secure safe manner both with my guidance and the guardrails ive built into it and with less of the need to have to learn how to prompt things from scratch.
     
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    So target would be solopreneurs/one man bands more the coaching people, consultants that sort of frame as wasnt sure if it really fits for say a one man band plumber etc.

    Are you certain this cohort of people are inclined to want more purchased services? These people are solopreneurs for a reason and most likely (just a guess) want to keep their costs around 5% of income. If you're building a product or service that requires integration/consultancy time with the customer, it might be more appropriate for growing companies that require workflow/process improvements. For the solopreneurs, who usually want to do everything themselves, a self-service SaaS, where they can get a 30 day free trial to see if it fits their needs, might suit them better.
     
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    Are you certain this cohort of people are inclined to want more purchased services? These people are solopreneurs for a reason and most likely (just a guess) want to keep their costs around 5% of income. If you're building a product or service that requires integration/consultancy time with the customer, it might be more appropriate for growing companies that require workflow/process improvements. For the solopreneurs, who usually want to do everything themselves, a self-service SaaS, where they can get a 30 day free trial to see if it fits their needs, might suit them better.
    So the time is coaching in how to get the best out of the Agent setup to do that self service work for them but without the headache of trying to get it into a shape where it can do that. SAAS solutions are abundant to fill their time with inane faff and more time sinks. What we are proposing here is an agent setup that works for the way they work and the processes automated where they need it rather than their current time being spent in all the different apps and saas they have trying to pull it all together and having no idea where their data is at this precise time. With the agent we can bring all that together based on what they are using.

    I already have services for workflow/process improvements for growing businesses and this agent could fit some of the smaller businesses in this area who arent ready for the full scoping of what can/should vs shouldnt be automated
     
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    I’m not sure many small businesses will see the benefit. £500/month without seeing the tangible benefits is a lot of money.

    Has applying your product to your business generated an additional £500 in profit?
     
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    I already have services for workflow/process improvements for growing businesses and this agent could fit some of the smaller businesses in this area who arent ready for the full scoping of what can/should vs shouldnt be automated

    The "growing businesses" seem like the low hanging fruit in terms of your market. I'd look to broaden that instead of pursuing the solopreneurs/one-person-band tier. What business objectives does targeting solopreneurs fulfil for you?

    Its a question for yourself really, but something to think about as you'd have to sell to more clients to achieve sales objectives.
     
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    I’m not sure many small businesses will see the benefit. £500/month without seeing the tangible benefits is a lot of money.

    Has applying your product to your business generated an additional £500 in profit?
    Yes quite a substantial amount over the £500 profit including the time and effort to build it out and do all the fixing etc over the 6 months
     
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    The "growing businesses" seem like the low hanging fruit in terms of your market. I'd look to broaden that instead of pursuing the solopreneurs/one-person-band tier. What business objectives does targeting solopreneurs fulfil for you?

    Its a question for yourself really, but something to think about as you'd have to sell to more clients to achieve sales objectives.
    Ye that's fair and it would then be more the smaller professional services firms that aren't quite ready for the bigger automation reviews etc. and I think I was including them in the small business space too.

    Solos was more hearing a problem much of the FB solopreneurs I know have been talking about but that is probably why price point became a bit of a conundrum for me
     
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    Yes quite a substantial amount over the £500 profit including the time and effort to build it out and do all the fixing etc over the 6 months
    That’s great. Would it also apply to a sole trader with a small business? For many small businesses £500 is a huge sum to invest without being sure of any tangible benefits.

    Someone selling widgets on Amazon may question the need to have agents doing anything.
     
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    So target would be solopreneurs/one man bands more the coaching people, consultants that sort of frame as wasnt sure if it really fits for say a one man band plumber etc.
    That's too broad and vague.

    Main thing is saves is time and potentially money depending on what they build with it
    But what can they build with it? I am desperate to find a daily use for AI in my business, but can't find one. Why do I need a solution for a problem I do not know or believe I have?

    Competitor wise there are basic GPT and Claude agent setups but not really anything like this. Ive only seen one other attempt something like this all built in claude
    You are a techie and know that these are other systems. For your current target audience, do they know this?

    there as a proper tool to help them automate parts of their business
    You need to give specific examples of this.... the sizzle!

    Your pricing, whilst probably competitive in the AI marketplace, probably isn't for the solution delivery. If I want AI to answer incoming calls, I want an intelligent receptionist, not the server, setup, maintenance etc.
     
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    That's too broad and vague.


    But what can they build with it? I am desperate to find a daily use for AI in my business, but can't find one. Why do I need a solution for a problem I do not know or believe I have?


    You are a techie and know that these are other systems. For your current target audience, do they know this?


    You need to give specific examples of this.... the sizzle!

    Your pricing, whilst probably competitive in the AI marketplace, probably isn't for the solution delivery. If I want AI to answer incoming calls, I want an intelligent receptionist, not the server, setup, maintenance etc.
    Ye the broadness of that needs tweaking why i though say really small sole traders wouldnt be in the market for it

    In terms of what they can build with it there are any number of things they can build depending on what they need in their business. Automate generating invoices, automate social media, build their own apps for their site, build landing pages for their websites or create an automated routing and analysis of emailed leads. Really the possibilities are vast it just depends on what they need in their business right now

    And yes sizzle is required that in sorting out its just trying to resolve on the pricing and what EnterprisePro stated earlier around the growing businesses which I was thinking about originally too. Which i think is that group of Professional Services firms i already know of who are in that very small stage but have so much say around Financial advisers where they need to put together annual reviews etc that take alot of admin time that is an area they could work on this with to pick up when a review is required populate their checklist of what they need, record their meeting and populate their system with it automatically for them to quickly review and the reports etc are created and the new strategies discussed can be initiated.

    And in terms of AI calls i wouldnt recommend that as they fall over too easily especially if there is more complicated conversations.

    This "Agent" is more a facilitator/employee to build what you might need in the business. It has all the guardrails and safety measures to build out solutions for them and then the coaching is there to help them understand anything around language models and how to get the best out of them and the Agent setup in a manner of learn by doing and watching. And they dont have to worry about updating it maintaining it or optimising it just using it
     
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    In terms of what they can build with it there are any number of things they can build depending on what they need in their business. Automate generating invoices, automate social media, build their own apps for their site, build landing pages for their websites or create an automated routing and analysis of emailed leads. Really the possibilities are vast it just depends on what they need in their business right now
    Do people really need all this?
    • Invoicing is taken care of by your accounting platform.
    • Automating SM is mostly pointless (if even needed)
    • Very few people would need apps for their website.
    • Landing pages can be created in seconds and for free by almost any AI tool.
    • Why would a small team need automated routing and analysis of emailed leads?
    I get what you are offering but it's an expensive service that solopreneurs, consultants, one-person businesses mostly don't need.
     
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    Do people really need all this?
    • Invoicing is taken care of by your accounting platform.
    • Automating SM is mostly pointless (if even needed)
    • Very few people would need apps for their website.
    • Landing pages can be created in seconds and for free by almost any AI tool.
    • Why would a small team need automated routing and analysis of emailed leads?
    I get what you are offering but it's an expensive service that solopreneurs, consultants, one-person businesses mostly don't need.
    Yes its a need that I have seen from the market. Both from FB solopreneur coaches, consultants etc and from the huge amount of admin that small professional service teams have that they want to get out of to help them increase the number of clients on their books. And that is the clear problems they have voiced to me on top of how they have ridiculous amounts of SAAS products to "fit" small jobs. I mean what i put is just a few off the top of my head things that could be done there is far more based on an individual businesses needs that can be done too and the tools, skills and plugins i have curated for this helps to guide and build exactly what the user wants without the need to become a prompt master.

    Invoicing sure done by a platform but they have also spoken about their umpteen numbers of subscriptions for services that dont quite fit their full needs and add more work than fit around how they work. Automated SM is pointless if its generic slop rather than focused on what their business is and does and targets the right sort of posts along with blog posts and case studies that they can move into a way.

    How do you know they wouldnt need apps for their website? Professional services business I have already spoken to find value in them and find value in connecting their specific FS tools to things like their CRMs etc which adds alot of manual effort

    Landing pages from free AI tools are atrocious and full of badly written code why would i want to recommend that over a setup that ensures the proper coding practices and steps to ensure there is little bloat and can be tested before hand to assess the setup?

    Why wouldnt a team want to have automated routing and analysis of emails? their time is precious so something that gives them back time to focus on clients or bringing in more clients is always something they are pursuing.

    I wouldnt say its expensive for the whole of that cohort there is definitely some that dont fit which is why talking through it those growing small businesses and small professional services firms are where i believe it fits both in terms of cost and possibilities of time and cost savings when considering the tools they use for their clients that are so disparate. And fits in the suite of services for those businesses who arent ready for a done for you automation process/audit. Its just finding that sweet spot for those people and i know it excludes the amazon widget seller im not targeting them
     
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    In terms of what they can build with it there are any number of things they can build depending on what they need in their business.
    But this is the issue - they do not know what they need.

    As mentioned, I desperately want to use AI more, but, whilst I do all of the things like accounting, SM, videos (I am playing with an AI platform at the moment), landing pages etc, I cannot justify the investment (mainly of time) for the minimal use it will actually get.

    Sure, in some scenarios, I could probably pinpoint a use, but not currently - you would need to create real life uses where it will save me time nd money that I can associate with. It is also unlikely I would pay any more than SAAS proces to achieve this.
     
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    But this is the issue - they do not know what they need.

    As mentioned, I desperately want to use AI more, but, whilst I do all of the things like accounting, SM, videos (I am playing with an AI platform at the moment), landing pages etc, I cannot justify the investment (mainly of time) for the minimal use it will actually get.

    Sure, in some scenarios, I could probably pinpoint a use, but not currently - you would need to create real life uses where it will save me time nd money that I can associate with. It is also unlikely I would pay any more than SAAS proces to achieve this.
    Which platform are you using? I know you tried openclaw but in the grand scheme of things what are you doing now that you dont want to do?

    That is the whole premise of what the solution does and then builds whatever they need. From my conversations with those small professional services people their biggest pain is admin and as part of the coaching it to help them get on track with figuring out what specifically they can do to get more of their time back and be able to get more clients in the end. Most of the time i see is the paralysis of not knowing where to start and the aim is to give them the tool that can do the doing but also get them out of that paralysis and into the doing without spending hours and hours learning how to prompt etc. I dont see it as a SAAS its the product and the coaching/guidance and optimisation. Otherwise it would just be a Claude or Codex build which is ok but like you said it requires the time investment.

    However i now know the framing of it is to adjust it to focus on that cohort I know that already talk about their admin headaches etc but arent in the space to get someone in to automate etc
     
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    Maybe stop talking about AI and agents and start selling the benefits of changing business processes.

    I do a lot of consultancy and don’t experience any of the issues you describe. But maybe that’s because I’m organised.
     
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    The big issue with SAS for business issues is the need to continue paying for access should you decide the system is not for you. With the need to access records for at least 6 or 7 years you end up committed paying for a further 6 or 7 years ( in this case between £36,000 to £63,000) to continue access to historical records on a system you may have only used for a year..
     
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    I did set up open claw, all excited with my shiny new toy - I called it Jeeves! It worked fine.

    I then quickly realised that there isn't a specific operation I could get it to do to really help me. I appreciate that for some, there will be things it can help with.

    When I get some time I will will dust off the cobwebs and try to setup a marketing/SM assistant, but my world will not collapse if I do not do it in the near future.
     
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    How do you know they wouldnt need apps for their website? Professional services business I have already spoken to find value in them and find value in connecting their specific FS tools to things like their CRMs etc which adds alot of manual effort
    This tends to be a one off activity. Not something you need to pay monthly for.
    Landing pages from free AI tools are atrocious and full of badly written code why would i want to recommend that over a setup that ensures the proper coding practices and steps to ensure there is little bloat and can be tested before hand to assess the setup?
    But you don't constantly create landing pages. It's something you do every now and then. If you are using a CMS code bloat isn't something to worry about.

    Why wouldnt a team want to have automated routing and analysis of emails? their time is precious so something that gives them back time to focus on clients or bringing in more clients is always something they are pursuing.
    You are targeting sole traders and small teams. It's unlikely you would need any routing. And there is a limit to the number of clients a single person can service. Gathering hundreds of leads is pointless. But again, this is a one off activity.

    As with many of the thing you mention in your posts they don't need a monthly subscription. The set up fee I can understand but not the subscription.
     
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    I did set up open claw, all excited with my shiny new toy - I called it Jeeves! It worked fine.

    I then quickly realised that there isn't a specific operation I could get it to do to really help me. I appreciate that for some, there will be things it can help with.

    When I get some time I will will dust off the cobwebs and try to setup a marketing/SM assistant, but my world will not collapse if I do not do it in the near future.
    Ye openclaw needed alot of work to be able to get it into a space that would "work". It needs alot of added memory plugins, enhanced skills and fixes around how it works on "projects. Try out Hermes if you want to have a play with something.

    But this setup i have here is essentially having all that work done with the setup so it can actually do specific operations that you need it to do. Finds the APIs it can use or automations it can build via python or whatever browser usage it needs to do and what is the art of the possible. I dont know what you specifically would need to it to do from everything its setup to workout how to do things. And that marketing/sm assistant is something it built using opensource scheduling tools so you dont have to reinvent the wheel with trying to get it to work out all the api calls etc just to focus on the content how to write for each platform and then schedule it in the tool it has hosted on itself and send out everywhere from FB, LI, Tiktok, Insta etc (and have it with approvals and rewrite commands so its not sending stuff you dont like)
     
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    This tends to be a one off activity. Not something you need to pay monthly for.

    But you don't constantly create landing pages. It's something you do every now and then. If you are using a CMS code bloat isn't something to worry about.


    You are targeting sole traders and small teams. It's unlikely you would need any routing. And there is a limit to the number of clients a single person can service. Gathering hundreds of leads is pointless. But again, this is a one off activity.

    As with many of the thing you mention in your posts they don't need a monthly subscription. The set up fee I can understand but not the subscription.
    I think you are misreading the subscription. Once setup that product is all for them and ye those items are one off.

    In terms of landing pages no not all businesses especially coaching business do not just have one landing page and its done they have many different products and many different launch cycles. And ive already said the target isnt sole traders small businesses was a very broad idea initially which is why from other comments its been narrowed for me there is a limit to how many clients someone can service but all dependant on what parts of that service are busy work for instance the financial advice and insurance advice market ive been talking to much of the things holding them back is the admin and routing of things. And i would argue leads being a one off activity is not a one off as for some of those firms that view it that way go through feast and famine cycles.

    So the subscription is mainly for the coaching and guidance (so time with me one to one and group coaching too) while the maintenance and optimisation of their setup still gets done its a smaller part of it but we start with guiding them with building at first and then they can run with it and not continue the subscription once its setup but i wouldnt want it as something to just give and be done with it as I want to make sure they can get the best out of it.
     
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    And for how long would they need coaching? Would they have gained the necessary skills in 6 months?

    The problem seems to be one of perception. What exactly do I get for my £500 each month?

    As I said before, stop selling the AI thing and start promoting the benefits of employing you.

    Which is another question. How many clients can you support? Would you have the time to look after more than 10? You could be spending hours each day coaching each one.
     
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    Just a quick point, but you started with the wrong question. What you need to understand and be able to explain to people who will value your product / service is "What is it worth?"

    You have already said it might be that it will save your client's time - how much time and how much is that time worth to your client?

    It might be that it takes some of the 'boring stuff' out of their workload - again how much 'boring stuff' is there and what value would a client put on saving that time; and what could they be doing in that time that is more interesting or more valuable?

    Can it make your marketing more effective? How much more effective and what would that be worth?

    And, is there a chance that your product / service could actually take away from them some of the stuff they enjoy? You will need to be able to answer that question.

    Sounds like you might have a really very attractive product / service, but maybe not a really good understanding of your prospective clients. Maybe you need to focus your effort there.

    Good luck!
     
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    Just a quick point, but you started with the wrong question. What you need to understand and be able to explain to people who will value your product / service is "What is it worth?"

    You have already said it might be that it will save your client's time - how much time and how much is that time worth to your client?

    It might be that it takes some of the 'boring stuff' out of their workload - again how much 'boring stuff' is there and what value would a client put on saving that time; and what could they be doing in that time that is more interesting or more valuable?

    Can it make your marketing more effective? How much more effective and what would that be worth?

    And, is there a chance that your product / service could actually take away from them some of the stuff they enjoy? You will need to be able to answer that question.

    Sounds like you might have a really very attractive product / service, but maybe not a really good understanding of your prospective clients. Maybe you need to focus your effort there.

    Good luck!

    I think I'll add to this. The people you're selling to, might be incredibly techy, but they are still executives. This means, chances are, you'll only have a few seconds to grab their attention and it can make or break your deal.

    Looking at myself as an example: I live and breath technology, but given my budgets are set and plans locked, I'm already less inclined to give any attention to anything unless I see a credible value proposition within a few seconds. I suspect many others are not much different.
     
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    And, is there a chance that your product / service could actually take away from them some of the stuff they enjoy? You will need to be able to answer that question.
    This!

    What I want is AI to clear the table and do the washing up, do the housework, go shopping, wash and iron my clothes, clean the litter trays, take the bins out and all the grungy jobs leaving me to do the fun stuff.
     
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    This!

    What I want is AI to clear the table and do the washing up, do the housework, go shopping, wash and iron my clothes, clean the litter trays, take the bins out and all the grungy jobs leaving me to do the fun stuff.

    and i think you've said something similar before - and what you're describing is more home automation. Your AI will just be the interface "Computer, where's my fricking washed and pressed suit?"
     
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    This is a selling proposition rather than a marketing one, but here's the pitch: "What would you pay me to free up three hours a week from your regular working week?

    This is a great question because if they low ball you - "Maybe £100", you can answer with "So your time is only worth £33 per hour! No wonder you are talking to a complete stranger!"

    If they answer in your price zone, great, but can you upsell?

    Finally, if they answer above your price you could offer the deal or offer a discount if they sign up there and then.

    These things are much easier to do on a forum than in real life in my experience!
     
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    and i think you've said something similar before - and what you're describing is more home automation. Your AI will just be the interface "Computer, where's my fricking washed and pressed suit?"
    And this is the point. People don’t want AI. They just want their lives to be simple or business more effective. It’s as @Paul Kelly ICHYB said: sell the sizzle not the sausage. AI is just one of many tools you can use to achieve a specific goal.
     
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    I’m looking for some pricing feedback in relation to solopreneurs, consultants, one-person businesses and very small teams.

    Over the last six months, I’ve spent a lot of time working through errors, wasted usage, unnecessary costs and various blind alleys to get my Hermes Agent setup working as well as it currently can and connected to all the different things i need it to be. Ive had interest from a few people as to how I have put it all together so far as ive shown some of the things I have developed for clients with it etc and going to look to them to see about how to price it too.

    Now it’s properly configured, it’s far more powerful and flexible than simply using something like Claude Code or Cowork on its own. It can handle much broader work, create and develop projects, and has controls in place to stop someone burning through all their usage in an afternoon.

    Most small business owners won’t have the time or inclination to go through the same learning curve, so I’m considering offering it as a done-for-you setup.

    I would install and optimise the full environment, then provide ongoing hosting, maintenance, fixes, improvements and coaching. The coaching is a big part of it: showing the owner how to use their “digital employee” get the most out of them and helping them apply it to their own work and processes.

    Based on my initial research of UK and US market and whats available in the market I'm currently considering:

    Setup: somewhere between £1000 and £2,500

    Coaching, hosting and support: between £500 and £750 per month


    £1000 feels too low for the setup, but £2,500 may be too high for the audience.

    Likewise, £500–£750 per month feels reasonable for the hosting, maintenance, optimisation, fixes and hands-on guidance, but I’m unsure where the right point is.

    Looking purely at the value and pricing, where would you place it?

    Am i overthinking this or would the setup be a bit too over the top for this sort of client profile?
    I think I’d work backwards from the customer rather than forwards from the amount of work that’s gone into building the solution.


    £1,000–£2,500 setup and £500–£750 per month could be perfectly reasonable, but for a solopreneur or one-person business that’s potentially a £7k–£11k first-year decision. At that point I’d want to be very clear about the measurable value I’m buying.


    The interesting part of your proposition isn’t really the hosting, maintenance or even the technology. It’s your description of a “digital employee”.


    If that digital employee saves me 10–15 hours a week, enables me to handle more clients, removes work I’d otherwise outsource, or generates additional revenue, £500–£750 a month could look inexpensive.


    If I’m effectively buying a sophisticated AI setup with some support, the same price may feel expensive.


    So before settling on price I’d probably test three things with prospective customers:


    1. What problem are they actually paying you to remove?
    2. What is that problem currently costing them in time or money?
    3. What measurable outcome would make £500+ per month feel like an obvious decision?


    You may also find that “solopreneurs and very small businesses” is too broad a target. A consultant billing £1,000+ a day could see enormous value in recovering a day a month, whereas another one-person business might struggle to justify £500 regardless of how capable the system is.


    I’d therefore be tempted to validate the ideal customer and value proposition before optimising the exact price point. Once you know who gets disproportionate value from it and why, the pricing question becomes much easier.
     
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