# What a price must cover besides the cost of the work [Home](https://theonlyaxelj.com/en) › [Study](https://theonlyaxelj.com/en/study) › [Articles](https://theonlyaxelj.com/en/study/articles) author: [Axel Jedlitschka](https://theonlyaxelj.com/en/about) published: 2026-10-13 updated: 2026-10-13 language: en reading time: 4 min topic: Marketing & sales source booklet: [What to Charge](https://theonlyaxelj.com/en/shop/introduction/pricing-exchange) A sound price covers every expense of the business, leaves room for the mistakes that will happen in delivery and builds a reserve, and most self-employed people price only the first of the three. When a self-employed person sets a price, they usually count what they can see: materials and hours. According to the source, a price has to cover three things. Most people price only the first, and sometimes only part of that. ## The central sentence of the booklet The booklet presents one sentence as its core, the one formula in the material. It is long, and each part matters. In short, it calls costing a **precise art**: the price must cover all the expenses, leave room for the losses and errors on the way to the customer, and be enough to build a reserve. Three components come out of it: - **Total expenses, administration and production.** The work itself, and also the time nobody buys from you: quotes, phone calls, bookkeeping and driving. - **Room for losses and errors in delivery.** The work you have to redo, the customer who does not pay, and the material that gets ruined. - **A reserve.** What is left after everything else is paid. According to the booklet, a business without a reserve is only a job. Suppose a renovation contractor prices wood, adhesive and labor hours. He leaves out the drive to measure the site, the delivery, and an assembly that always takes longer than planned. None of that is in his price. Or an IT support specialist who prices development hours. Meetings, documentation and a fortnight of fixes once the project is handed over never reach the price. And the other way: the same specialist, after he began adding a fixed percentage to every quote to cover errors. Three projects later, the addition covered exactly what had happened. ## Why leaving room for mistakes is realism The second component is the hardest to talk yourself into. It feels like pricing your own failure in advance. The source does not assume you are bad at your job. It assumes that delivery happens in the real world, and there things go wrong. A customer changes their mind halfway through, a supplier runs late, something breaks in transit, and sometimes you make a mistake. A business that leaves this out of its price pays for it out of pocket. That is the month when it feels as if everything went wrong. In practice it was what always happens, and the price never covered it. Suppose the owner of a removals company who had a bad seventh month every time. When he checked, it was always the month something broke, and it had happened before too. Or a bookkeeper who treated one client who did not pay as a one-off, until she counted four such cases in three years. ## A precise art For costing, the source picks a phrase that sounds like a contradiction. It does not call it a formula, and it does not call it a feeling. According to the booklet, the phrase is exactly right. Part of pricing is precise: you can count hours, materials and loss percentages. Part of it is not: what a reserve is worth to you, and what the customer will actually pay. A price built from the precise part alone drifts away from what the buyer will pay, and lands too low one time and too high the next. A price built from the art alone falls apart when it meets reality. Take a designer who worked out every expense with care and still set a price that nobody in her market pays. Her sums were correct. Her pricing decision was not. ## Costing, pricing and selling The source closes the chapter with a line that separates three things most people mix up: “sales (once promotion is done) are bound up really in COSTING, PRICING AND SELLING.” **Costing** is knowing what it costs you. **Pricing** is deciding what to ask. **Selling** is getting it. According to the booklet, most people work on the third and skip the first two. Suppose a business owner who learned three closing techniques and never worked out what an hour of his work costs him. He closes more deals, all of them at the wrong price. And the other way: a designer who kept the three apart. Her cost stayed a fact, her price became a decision, and the talk with the customer became a skill. ## What the booklet adds This chapter of the booklet includes two exercises: a break-down exercise and a percentage exercise. From there it moves to the test that sets the floor of a price, and to why a price does not have to relate to cost at all. A price that covers only the work itself looks fair on paper. In practice it leaves you funding everything else out of your own pocket. The booklet is general knowledge, not financial advice for your business. - [What to Charge](https://theonlyaxelj.com/en/shop/introduction/pricing-exchange): A method for pricing instead of copying, and one test that tells you whether the price was right: not on the day they paid, but on the day they came back. --- [עברית](https://theonlyaxelj.com/he/study/articles/three-things-every-price-must-cover) · [Español](https://theonlyaxelj.com/es/study/articles/three-things-every-price-must-cover)