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    5 Replies Latest reply on May 8, 2009 8:03 AM by LUCKIEST

    Pricing: How do I determine a per diem rate?

    perfumenero Newbie
      I live in PA and offer a service that I normally conduct within driving distance from my home (specialty in-home parties).

      A customer wants to know how much I would charge to conduct my service at their home in Florida. In addtion to travel, lodging, and party service expenses, I need to tell them how much I would expect to be paid during travel.

      Does "per diem" include only my time, or does it also include meals? Does "travel" equate to an 8-hour work day? Do I need to break meals and TIME down for the client?

      Thanks!

        • Re: Pricing: How do I determine a per diem rate?
          Bluesuit Adventurer
          Per diem is generally used in the context of "daily allowance" - so cost for transport, accomodation, and food. It does not include the cost of your time/services.
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            • Re: Pricing: How do I determine a per diem rate?
              perfumenero Newbie
              Thanks for your response!

              Can I assume that every time I quote a per diem rate, it is customized to match the estimated costs of the particular client (i.e., a location where I would fly versus a location where I would drive)?

              When I have done a "driveable" long-distance party, I have quoted the client the "individual" approximate costs for mileage, meals and hotel (if applicable). Should I instead just quote a per diem that includes all of these things for the particular client?

            • Re: Pricing: How do I determine a per diem rate?
              dublincpa Scout
              Per Diem can mean just about anything. The concept here is that the travel is presumably eliminating other earning opportunities for you. With some consulting services/projects travel time is eaten as part of the job. For others like expert witness of a CPA or Physician, days away from the office are usually compensated.

              It all boils down to what you have to gain by doing it and what you are giving up by doing it. If this is going to be the biggest most profitable thing you have done and the travel time is relatively limited, just bill out of pocket expenses.

              Another thing to consider is whether this event will open the doors to a social circle that will generate profitable referrals. Sometimes once you get "in" with one member of a crowd, everybody has to do the cool new thing to keep up with the Joneses (sp?). Once you have served at a level, you will have credibility with others at that level in other circles.
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              • Re: Pricing: How do I determine a per diem rate?
                phanio Pioneer
                Your per diem rate should include everything you can think of - Good adive to include your opportunity costs of other business you may lose out on. Also, what are others in your industry charging? Make sure your rates are competitive.

                Business Money Today
                • Re: Pricing: How do I determine a per diem rate?
                  LUCKIEST Guide
                  Pricing: How do I determine a per diem rate??

                  I think that you need to figure out what you want for your services, your time and your travel.
                  YES you should break down the time and costs for yourself (NOT THE CLIENT) and submit one amount.

                  The client should NOT know your hourly or daily rate.

                  *+Per diem +is understood to include the additional expenses
                  incurred living away from home-basically having two residences. The IRS
                  sets the maximum amount of per diem each year based on the location-for
                  instance, New York City has a higher rate than Peoria, Illinois.*

                   

                  *To qualify for per diem, your work-related business activity should
                  be at least fifty miles from your tax home, and require an overnight
                  stay.*

                   

                  LUCKIEST