# Dana's floor: a rate from real hours > A solo tutor's rate from target income, the hours actually worked, taxes and the quiet summer, and why a price per lesson can hide a low hourly rate. - Course: [Pricing: Set, Package and Raise Your Prices](https://productovi.com/courses/pricing.md) - Module: How low can the price go, and how high could it reach? - Lesson 3/32, ~26 min - Source: https://productovi.com/courses/pricing/danas-rate-floor ## A different business **Alex Tutor:** Today a different business: not Klasna's price list but Dana's own practice. She teaches English at Klasna and, since September, also teaches adults privately in her evenings. **Dana:** Three students in September, all through friends; I also run a social-media account and a messenger channel. None from Klasna; I don't approach Klasna's learners, that's the deal with the school. I charge 600 for a 60-minute lesson. **Sofia:** How did you pick 600? **Dana:** Klasna charges families 650, so 600 felt fair. I wanted the practice to add about 150,000 a year after tax. I haven't touched the price since. **Alex Tutor:** Then let's check 600 two ways: per lesson against her income target, and per hour actually worked against what an hour at Klasna pays her. **Dana's booked private lessons, September 2026 – August 2027** | month | Booked lessons | | --- | --- | | 09.26 | 18 | | 10.26 | 24 | | 11.26 | 30 | | 12.26 | 22 | | 01.27 | 32 | | 02.27 | 40 | | 03.27 | 48 | | 04.27 | 48 | | 05.27 | 46 | | 06.27 | 38 | | 07.27 | 14 | | 08.27 | 9 | *September is actual (3 students); the other months are her forecast made in October. 369 lessons booked in the year.* > **Exercise:** Dana set 600 because "Klasna charges families 650, so 600 felt fair". What did that choice rest on? ## Per lesson: does 600 hit the target? **Dana:** My plan for the year: 369 lessons booked. Some learners will miss without notice; I expect 21 of those, and I don't charge them. So 348 paid lessons. **Alex Tutor:** Costs that come with the practice: 6% of income in single tax and military levy, and 7,200 a year for her video plan and materials. Prices are final: she's in single-tax group 3 with no VAT. **Sofia:** And the social contribution, the ЄСВ? About 1,900 a month is a big cost. **Alex Tutor:** Ask whether it changes because of the practice. Dana pays the ЄСВ anyway as a FOP with Klasna income. The practice doesn't add a hryvnia to it, so it isn't a cost of the practice. Counting it would charge her twice. > **Exercise:** Dana pays the monthly social contribution (ЄСВ, 1,902.34 as of October 2026) as a FOP because of her Klasna income. Should it be in the costs of her private practice? ## The target and the floor **Sofia:** So the year brings 348 × 600 = 208,800. Tax is 12,528, tools 7,200. **Alex Tutor:** And a rate floor from her target: 150,000 net plus 7,200 of tools, divided by what each paid lesson keeps after the 6%. > **Exercise:** Dana wants 150,000 a year net from the practice. Her tools cost 7,200 a year, 6% of income goes to single tax and levy, and she expects **348 paid lessons**. What is her rate floor per lesson? In UAH, to two decimals. $$ R_{floor} = \frac{I_{target} + C}{N_{paid} \times (1 - t)} = \frac{150\,000 + 7\,200}{348 \times 0.94} = 480.56 $$ *I target: net income she wants from the practice; C: costs of the practice; N paid: lessons she will be paid for; t: the 6% single tax and levy.* **Alex Tutor:** Note that it divides by paid lessons only. The 21 no-shows bring nothing, so the floor already makes the paid lessons carry them. **Dana:** So my floor is 480.56 and I charge 600. I'm comfortably above it! > **Exercise:** What will Dana's practice bring her **net** for the year: 348 paid lessons at 600, minus 6% tax on income, minus 7,200 of tools? In UAH. ## Per hour: where the time goes **Alex Tutor:** Now the hours. A paid lesson isn't 60 minutes of her time: add 20 of preparation and 10 of messages and rescheduling. A no-show still costs 80: she prepared and waited. **Dana:** And the marketing. About 80 hours a year on my account, my channel and finding learners: more this autumn, very little once my evenings are full. Plus 24 hours of records, tax and payments. **Sofia:** Lessons: 348 × 1.5 = 522 hours. No-shows: 21 × 80 minutes = 28 hours. Then 80 + 24 more. **Alex Tutor:** And at Klasna? A 50-minute lesson plus 10 minutes of notes is one hour for 500, which is 470 after the 6%. > **Exercise:** How many hours will Dana actually work on her practice in the year? 348 paid lessons × 90 minutes, 21 no-shows × 80 minutes, 80 hours of marketing, 24 hours of admin. ## The hour that isn't an hour **Alex Tutor:** Now divide. 189,072 net over 654 hours. That's her **effective hourly rate**, the number a price per lesson hides. **Dana:** Wait. If that's under 470, every evening on the practice pays me less than an hour of Klasna lessons. **Alex Tutor:** And the summer makes it worse: July and August bring only 23 of the 369 lessons, while the posts and admin go on. That's why we compute over a whole year, never from a busy month. **Sofia:** And to match Klasna's 470 an hour at today's hours, the price would need to be... **Alex Tutor:** (470 × 654 + 7,200) / (348 × 0.94) = 961.67. Nobody's saying "charge 962 tomorrow". It says the gap is mostly unpaid time, not just price. > **Exercise:** What is Dana's **effective hourly rate** on the practice: 189,072 net over 654 hours worked? In UAH per hour, to two decimals. **Alex Tutor:** One more thing about July and August. > **Exercise:** Dana's hourly rate is fairer to judge from a full month like March, with 48 lessons, than from the whole year. **Alex Tutor:** So what do the two numbers say together? > **Exercise:** Dana's rate floor from her target is 480.56 and she charges 600, yet her effective hourly rate is 289.10 against 470 an hour at Klasna. Which conclusion fits both numbers? ## Your turn: is 600 too low? **Dana:** So should I just double my price? I'd lose half my students. **Alex Tutor:** Not necessarily. Look at the levers: unpaid preparation, messages, no-shows, posting time, and the price itself. Raising a rate well is a later module. **Sofia:** And the floor from her target still holds: 600 does reach 150,000. **Alex Tutor:** Right, both are true at once. Write Dana an honest answer. > **Exercise:** Dana asks: **"So is 600 too low?"** In 3–5 sentences, answer her with these numbers: her rate floor from a 150,000 net target is 480.56; at 600 the year brings 189,072 net; the practice takes 654 hours a year (about 1.88 hours per paid lesson, counting preparation, messages, no-shows, marketing and admin), so it pays 289.10 an hour against 470 an hour after tax at Klasna. Say what 600 does and doesn't achieve, and name two levers other than doubling the price. > **Key ideas** > > - **Rate floor = (target net income + costs of the practice) / (paid lessons × (1 − tax))**, over a whole year: 480.56 for Dana. > - Count only costs the practice changes. The ЄСВ she pays anyway because of Klasna is not a cost of the practice; the 6% on practice income is. > - A paid lesson is not an hour: preparation, messages, no-shows, posts and admin made each one cost Dana 1.88 hours. > - The **effective hourly rate** (289.10) is the honest comparison with her alternative use of time (470 an hour at Klasna). > - The gap can be closed with time as well as price: cancellation rules, reusable preparation, fewer unpaid hours. **Alex Tutor:** Next: back to Klasna, and your first case. A price corridor for NMT Sprint. - Previous lesson: [The floor per lesson and per Club member](https://productovi.com/courses/pricing/the-floor-per-lesson.md) - Next lesson: [Case: a price corridor for NMT Sprint](https://productovi.com/courses/pricing/nmt-sprint-corridor-case.md) --- Productovi Learning. Free, no sign-up needed to read.