Why Your Location Matters: Understanding Regional Pricing Differences

The Geography of Pricing

A hairstylist in New York City charges very different rates than one in rural Kansas. Why? Cost of living.

The Cost of Living Multiplier

WorthIt uses regional multipliers to adjust prices based on local economics:

• Midwest: 0.85x (lowest cost of living)
• Southwest: 0.95x
• East Coast: 1.15x
• Northeast: 1.25x (high cost of living)
• West Coast: 1.35x (highest cost of living)

What This Means in Real Numbers

Example: Graphic Designer

• Base rate: $50/hr
• Midwest: $50 × 0.85 = $42.50/hr
• West Coast: $50 × 1.35 = $67.50/hr

Same skill, 59% price difference due to location.

Why Location Matters

1. Cost of Living

• Rent in San Francisco: $3,000+/month
• Rent in Des Moines: $1,200/month
• Service providers need higher rates to cover expenses

2. Local Market Rates

• High-cost cities attract more affluent clients willing to pay premium rates
• Lower-cost areas have more price-sensitive clients

3. Business Expenses

• Software subscriptions cost the same everywhere
• But they represent a larger percentage of income in low-cost areas

4. Talent Competition

• Major cities attract top talent, driving rates up
• Smaller markets have less competition but fewer clients

Remote Work Changes Everything

With remote work, location becomes more complex:

Should you charge based on:

• Where you live? (Your cost of living)
• Where your client lives? (Their market)
• Where the work is performed? (Often irrelevant now)

Best Practice: Charge based on where you live, but adjust for your client's market if they're in a much higher-cost area.

Examples Across Professions

Hairstylist

• Midwest: $25-35/cut
• Northeast: $40-60/cut
• West Coast: $50-75/cut

Plumber

• Midwest: $60-80/hr
• Northeast: $85-120/hr
• West Coast: $100-150/hr

Freelance Developer

• Midwest: $40-60/hr
• Northeast: $60-90/hr
• West Coast: $80-150/hr

Should You Relocate for Better Rates?

Not necessarily. Consider:

• Cost of living increase - Will you actually make more after higher expenses?
• Client base - Can you serve local clients or stay remote?
• Quality of life - Is the higher income worth the lifestyle change?

Reality Check: A developer earning $80/hr in San Francisco might have the same purchasing power as one earning $50/hr in Kansas City after accounting for living expenses.

For Remote Service Providers

If you work remotely:

1. Research your client's local market rates
2. Consider their cost of living
3. Price somewhere between your local rate and their local rate
4. Communicate your value clearly

The Bottom Line

Your location affects what you should charge. Use WorthIt to understand regional pricing, then set rates that reflect both your local market and your client's ability to pay.

Don't undercharge because you live in a low-cost area. Don't overcharge just because you live in a high-cost area. Find the sweet spot.