Pricing glossary

The total cost of producing one full batch of a handmade product (soap, candles, baked goods, jewelry). Computed as the sum of all materials used in the batch plus the labour hours to make the batch, valued at the maker's burdened hourly rate. Per-unit cost is then batch cost divided by the number of units the batch yields.

The beverage-industry equivalent of food cost percentage: (ingredient cost of one beverage serving ÷ menu price) × 100. Bar and beverage programs typically target 18 to 24 percent, lower than food targets because beverage pricing carries more overhead contribution.

The hours a freelancer or service provider works on client deliverables that can be charged to a client. Billable hours are distinct from total working hours, which include unbillable time (admin, marketing, professional development). The ratio of billable hours to total working hours is the billable utilisation rate, typically 65 to 80 percent for independent professionals.

A salon business model where the stylist or esthetician rents a chair or booth from the salon owner for a fixed weekly or monthly fee, keeps all service revenue, and supplies their own products. Contrast with commission structure, where the salon takes a percentage of each service.

The hourly rate a freelancer must charge clients to recover their desired take-home pay after accounting for unbillable time, overhead, and self-employment taxes. Computed as desired take-home × (1 + unbillable ratio), then adjusted for overhead and tax. This is the foundational number behind every freelance rate calculator on meyy.info.

Computer-Assisted Translation tool. Software (Trados, memoQ, Wordfast, OmegaT) that stores previously translated segments in a translation memory and reuses them on new documents. Translators typically offer a discount (10 to 30 percent) on repeated or fuzzy-match segments found in the TM.

A commercially licensed kitchen that has been inspected by the local health department and meets food-safety regulations for commercial food production. Required in most jurisdictions for selling food that cannot be produced under cottage food law exemptions. Rent by the hour, day, or month from shared-use commercial kitchens.

A soap-making method where oils and lye water are mixed and saponified over 24 to 48 hours, then cured for 4 to 6 weeks before sale. Cold-process soap pricing must account for the long cure-time inventory holding cost, which melt-and-pour soap does not carry.

A salon and spa business model where the service provider is employed by the salon and paid a percentage of each service rendered (typically 40 to 55 percent), with the salon owner covering overhead, products, and marketing. Contrast with booth rental and suite rental models.

The total annual cost of running your business — the sum of direct materials, direct labour, and all overhead. The CODB model is the foundational philosophy behind every meyy.info calculator: prices should be derived from true cost, not from multipliers or competitor rates. See our methodology page for the full framework.

The direct costs attributable to the production of the goods or services sold by a business — direct materials plus direct labour. COGS excludes overhead (which is operating expense, not cost of sales). Gross profit is revenue minus COGS; gross margin is gross profit divided by revenue.

State-level regulations that permit the production and sale of certain low-risk foods (typically baked goods, jams, candies, dry herbs) from a home kitchen without a commercial kitchen license. Varies significantly by state — what you can sell, where you can sell it, and the annual revenue cap differ. Our cottage food law guide summarises the major state variations.

The 4 to 6 week period cold-process soap must rest before sale, during which saponification completes and excess water evaporates. Cure time is a pricing input because it ties up inventory and cash; the longer the cure, the higher the working-capital requirement and the larger the batch that must be in production at any time.

A flat fee charged for a full day of work, regardless of the exact hours worked. Common in event and corporate photography, videography, interpreting, and consulting. Day rates typically discount the equivalent hourly rate by 10 to 20 percent in exchange for the guaranteed full-day booking. Contrast with half-day minimum.

A multiplier applied to direct materials cost in handmade product pricing to account for the designer's creative work, brand value, and design time. Typical jewelry designer markups range from 2× (keystone) to 4× for established designer brands, applied on top of labour and before margin.

Costs that can be directly attributed to the production of a specific unit of product or service — direct materials and direct labour. Direct costs scale linearly with production volume. Contrast with overhead (indirect costs), which do not vary with volume in the short term.

A photographic print pricing model where the price of a print increases as the edition sells out, reflecting scarcity. Open editions (unlimited prints) carry the lowest multiplier; limited editions of 25 or fewer command 3× to 6× the direct cost. Our photographer print pricing calculator uses an edition-based scarcity multiplier.

Costs that do not vary with production volume in the short term — rent, insurance, software subscriptions, equipment depreciation. Fixed costs are part of overhead and are allocated to per-unit cost via the per-unit overhead equation (annual overhead ÷ annual units). Contrast with variable costs.

The restaurant-industry standard pricing metric: (ingredient cost of one serving ÷ menu price) × 100. Target ranges vary by segment — 25 to 32 percent for full-service restaurants, 28 to 35 percent for food trucks, 30 to 38 percent for home bakeries. Inverted, the formula gives menu price = ingredient cost ÷ target food cost %.

The percentage of fragrance oil by weight in a candle, typically 6 to 10 percent of wax weight (1 ounce of fragrance per pound of wax is the standard 6.25 percent load). Fragrance load is a candle pricing input because fragrance oil is usually the most expensive per-ounce ingredient.

A voluntary tip paid by the customer to service staff, typically 15 to 22 percent of the pre-tax bill. In catering and event pricing, gratuity is sometimes built into the per-guest price (service-included) and sometimes listed as a separate line. Service charges (mandatory) are taxed differently than gratuities (voluntary) in most U.S. jurisdictions.

Gross profit divided by revenue, expressed as a percentage. Gross profit is revenue minus cost of goods sold (direct materials plus direct labour). Gross margin does not include overhead or operating expenses. A business with 60 percent gross margin and 55 percent operating expense ratio has only a 5 percent net margin.

A booking policy that requires clients to pay a minimum fee (typically half the day rate) even if the actual work takes less than a half day. Common in event photography, videography, and interpreting. Half-day minimums protect the provider from losing a full day of availability to a short booking.

A pricing model where the client pays for actual hours worked at an agreed hourly rate. Simple to quote and transparent, but penalises efficiency (faster work earns less) and creates friction if scope expands. Contrast with project pricing and value-based pricing.

A traditional retail markup of 2× the direct cost (i.e., price = 2 × cost). Common in jewelry, gifts, and specialty retail. Keystone markup produces a 50 percent gross margin (not 100 percent — margin and markup are different). Our jewelry calculator offers keystone as an alternative to margin-based pricing.

The per-print cost charged by a photo lab to produce a photographic print, including paper, chemistry (or ink), and finishing. Lab cost is the direct material cost in photographer print pricing; it scales with print size and finish (glossy, lustre, metallic, giclée).

A flat fee charged by a marketplace (Etsy, eBay, Amazon Handmade) for listing an item for sale. Etsy charges $0.20 per listing, renewable every four months. Listing fees are a fixed cost per SKU and must be factored into per-unit overhead for low-volume sellers.

The amount added to cost to arrive at price, expressed as a percentage of cost. Markup is not the same as margin: a 50 percent markup produces a 33 percent margin (price = cost × 1.5; margin = 0.5 ÷ 1.5 = 33%). Using markup when you mean margin is the single most common pricing mistake; our calculators use margin unless explicitly stated (jewelry keystone is the documented exception).

A soap-making method where a pre-made soap base is melted, scented, coloured, and poured into moulds. Melt-and-pour soap can be sold immediately (no cure time), but carries a higher per-ounce material cost than cold-process soap. Pricing must reflect the trade-off between material cost and inventory holding cost.

The cost of mounting, matting, and finishing a photographic print for sale — foam core, mat board, backing, hardware. Mounting cost is a direct material in photographer print pricing and is often forgotten by photographers who underquote print sales.

National Academy of Sports Medicine certification, one of the most recognised personal training credentials in the U.S. NASM-certified trainers typically command 15 to 30 percent higher hourly rates than non-certified trainers, with the premium varying by market and specialisation.

Net profit divided by revenue, expressed as a percentage. Net profit is revenue minus all costs (direct, overhead, interest, taxes). Net margin is the true bottom-line profitability metric — a business can have a strong gross margin and a weak net margin if overhead is too high.

An Etsy fee charged when a sale originates from Etsy's off-site advertising (Google Shopping, Facebook, Instagram). Currently 12 to 15 percent of the item price (lower rate for sellers under $10,000 annual revenue, who are billed only if they opt in; mandatory for sellers above that threshold). The largest single fee line for many Etsy sellers.

All business costs that are not direct materials or direct labour — rent, utilities, software subscriptions, insurance, marketing, professional fees, equipment depreciation, and the cost of unbillable time. Overhead must be allocated to per-unit price via the per-unit overhead equation (annual overhead ÷ annual units) for prices to be profitable.

A fee charged by the payment processor (Stripe, PayPal, Square, Etsy Payments) for handling a credit-card transaction. Typically 2.5 to 3.5 percent of the transaction amount plus a fixed per-transaction fee ($0.25 to $0.30). Payment processing fees are deducted from the seller's revenue and must be factored into pricing.

A pricing unit where the client pays an agreed amount per hour of work delivered. Used in tutoring, consulting, freelance services, and home services. The per-hour rate should equal the burdened hourly rate plus overhead allocation plus target margin — not the take-home pay the provider wants.

A flat fee charged for completing an entire project, regardless of hours worked. Common in graphic design, web development, writing, and video editing. Per-project pricing rewards efficiency (faster work earns more per hour) but requires accurate scope definition to prevent margin erosion from scope creep.

The overhead dollar amount allocated to each unit sold, computed as annual overhead ÷ annual units. The single most overlooked pricing input — most makers and freelancers do not know their per-unit overhead, which is why their prices look fine on paper but lose money in practice.

A pricing unit used in freelance translation and writing where the client pays an agreed amount per word of the delivered document. Translation per-word rates vary by language pair (English to Spanish: $0.08 to $0.12/word; English to Japanese: $0.15 to $0.25/word) and specialisation. See our translation rate guide for the full benchmark table.

The difference between the planned serving size and the actual serving size delivered, expressed as a percentage. Portion variance is a hidden food-cost leak — if a food truck plans 6-ounce portions but staff serve 7-ounce portions, food cost percentage rises by 16 percent. Tracked through portion-control tools and recipe adherence.

In restaurant accounting, the sum of cost of goods sold (food and beverage ingredients) plus direct labour. Prime cost is the single most important restaurant profitability metric — full-service restaurants target a prime cost of 60 to 65 percent of revenue; food trucks target 65 to 70 percent.

A contract clause granting the client the right to make personal-use reprints of a photographic image. Wedding and portrait photographers who include a print release can charge a higher session fee because the client can print at their own cost; photographers who retain print rights earn revenue on print sales instead.

Profit divided by revenue, expressed as a percentage. The target profit margin is the lever in the margin-aware pricing equation (price = cost ÷ (1 − margin)). A 35 percent margin means 35 cents of every dollar of revenue is profit. Most service businesses target 20 to 40 percent; product businesses target 15 to 35 percent. Margin is not the same as markup.

A pricing model where the client pays a flat fee for an entire project regardless of hours worked. Rewards efficiency, simplifies client budgeting, and shifts scope-creep risk to the provider unless scope is tightly defined. Contrast with hourly pricing and value-based pricing.

A pricing model where the client pays a fixed monthly fee for a defined scope of work or guaranteed availability. Common in consulting, freelance writing, legal services, and design. Retainers provide predictable revenue and reduce client-acquisition cost, but require careful scope definition to prevent scope creep eroding effective hourly rate.

A surcharge (typically 25 to 100 percent of the base rate) applied to projects requiring turnaround faster than the provider's standard lead time. Rush fees compensate for schedule disruption, weekend or evening work, and the opportunity cost of bumping other clients. Should be disclosed in the pricing policy before booking.

Registered Yoga Teacher certification through Yoga Alliance. RYT-200 (200-hour training) is the entry-level credential; RYT-500 and E-RYT designations command higher rates. Certified instructors typically charge 15 to 30 percent more than uncertified instructors for private sessions.

A mandatory fee added to a catering or event bill, typically 18 to 22 percent of the food and beverage subtotal. Unlike a gratuity (which is voluntary and goes to staff), a service charge is part of the seller's revenue and is subject to sales tax in most U.S. jurisdictions. Must be disclosed in the contract.

The total ingredient cost of one serving of a recipe, computed by dividing the recipe ingredient cost by the number of servings the recipe yields. Serving cost is the input to the food cost percentage equation. Accurate serving cost requires precise recipe costing — including trim waste and portion variance.

A word in the source (original) language of a translation project. Most translation per-word rates are quoted on source word count, but some language pairs (notably into languages with no spaces like Japanese or Thai) are quoted on target word or character count. Clarify which before quoting.

A unit of measurement in translation pricing equal to 55 characters (including spaces) in the target language. Common in European translation markets, particularly Germany and Austria. Per-line rates typically range from €1.20 to €2.50 depending on language pair and specialisation.

A salon business model where the stylist or esthetician rents a fully private suite from a salon-suite brand (Sola, My Salon Suite) for a fixed monthly fee. Provides more privacy and brand independence than booth rental but at a higher fixed monthly cost. Pricing must amortise the suite rent across expected monthly services.

A word in the target (translated) language of a translation project. Target-word pricing is used when source-word count is unreliable (e.g., translating from character-based languages) or when the target language expands or contracts significantly (e.g., English to German typically expands by 15 to 25 percent).

A discount offered to wholesale buyers (retailers, galleries, designers) who resell the product to end consumers, typically 40 to 55 percent off the retail price. Trade discounts compensate the buyer for the reseller's marketing, inventory, and sales effort. Wholesale price = retail price × (1 − trade discount %).

A percentage fee charged by a marketplace (Etsy, Amazon Handmade, eBay) on each completed sale, calculated as a percentage of the item price (sometimes including shipping). Etsy's transaction fee is currently 6.5 percent of the order total. Combined with payment processing and offsite ads fees, marketplace fees can total 15 to 22 percent of revenue.

A database of previously translated segments (sentences or phrases) maintained by a CAT tool. When a new document contains a segment that matches the translation memory, the CAT tool reuses the prior translation and the translator typically offers a discount (10 to 30 percent for fuzzy matches, up to 100 percent for exact matches).

A surcharge for travel to a client location outside the provider's standard service radius, calculated as either a flat zone fee, a per-mile rate (IRS standard mileage rate is the typical benchmark), or actual travel time at the provider's hourly rate. Travel fees should be disclosed in the pricing policy before booking.

The portion of an ingredient lost during preparation — peels, trim, bones, off-cuts. Trim waste must be factored into serving cost: if a recipe calls for 1 pound of trimmed carrots and carrots trim 20 percent, you must purchase 1.25 pounds to yield 1 pound of usable ingredient. Ignoring trim waste understates serving cost.

Working hours that cannot be charged to a client — admin, bookkeeping, marketing, professional development, answering emails, software setup. Freelancers Union surveys show unbillable time is typically 20 to 35 percent of total working hours for independent professionals. Must be priced into the billable hourly rate via the burdened hourly rate equation.

A pricing model where the price is set based on the value the work creates for the client, not on the provider's cost or hours. Requires the provider to understand the client's economics (revenue impact, cost savings, risk reduction) and to negotiate price relative to that value. Contrast with hourly and cost-plus pricing.

Costs that vary directly with production volume — direct materials, direct labour, per-unit shipping, per-transaction payment processing fees. Variable costs scale linearly with units sold. The sum of variable costs per unit plus per-unit overhead plus target margin produces the minimum viable price.

The cost of the container (glass jar, tin, vessel) in candle and soap pricing. Vessel cost is often the second-largest per-unit direct material cost after wax or oils. Reusable vessel programs can amortise vessel cost across multiple sales but require a return logistics system.

The total weight of wax in a finished candle, the primary driver of candle direct material cost. Wax is priced per pound or per kilogram; per-candle wax cost = wax weight × wax price per unit. Standard container candles use 6 to 16 ounces of wax depending on vessel size.