The Tesco Test

The Tesco test is a quick but useful test of your pricing strategy. It involves working out if you are better off running your business or working stacking shelves in Tesco.

The Tesco test – method 1

Add up all the hours you’ve spent on a client project or working for a particular client. Don’t forget the time spent on all those meetings before you started work, the elaborate proposal you sent them, and any re-work you had to do.

Plus all the phone calls, liaison, reading and answering emails. And add in the time it took to send your invoice and chasing them for payment.

Also add up anything you’ve spent on the client project, including specialist software, materials and help from freelancers.

Compare this with how much you billed the client, and work out your real hourly rate.

Does this beat the Tesco test? Was your hourly rate more than £9.52?


tesco test

The Tesco test – method 2

Add up all of the hours you have worked over the last year.

Take your net profit for the last year and divide it by the number of hours you’ve worked.

Does this one beat the Tesco test?

I got this from one of my clients whose business was not doing well. He’d worked out that he would have been better off working at Tesco, because he would have earned more money, and wouldn’t have had all the stress and heartbreak of running a business.

Of course, if you’re not beating the Tesco test, you could do the same as he did, and get some help to sort out his business.

Here are some options:

  • Get yourself a copy of Sweetspot Pricing and start working out how to improve your prices


  • Book yourself onto the next Remarkable Business programme and work with a group of other business people and me to fix whatever’s making you worse off than working at Tesco



If you’re really worried…

Although the Tesco test method is a good wake up call to see what’s going on with your business, it’s a bit rough and ready as a test. After all, there might be good reasons why your hourly rate is low at the moment, such as you’re setting up a new business, or pivoting your existing one to something else.

If you’re really worried about how your business is doing, here’s a much more serious discussion of what might be going on, and what to do about it. How to know if your business is failing…


tesco test method


Photo credits to Eddie on Flickr and Simon Hutsche from Unsplash, plus a Banksy pic by Duncan Hill vaguely related to the Tesco test and included here just because I like it.

Sweetspot pricing – read the first chapter for free

You can get started on Sweetspot Pricing today – here’s the first chapter to download for free to try it out. I’ll also send you some regular tips on how to grow your business.
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