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Pricing home-based services

What's the best way to price the services I deliver from my home-based business? 
Three things to keep in mind:

1. What does it cost you to be in business? Don't forget to include all direct operating costs, as well as indirect costs, including your time. And of course, don't forget to include your profit margin.

2. What will the market bear? What are others charging for the same - or a similar - type of service in your market?

3. Where are you in the life of your company? If you're just starting out, you may have to start lower than you would prefer, if only to get established. Once clients know your quality, you can justify raising your rate for them and for new customers. 
Brain Trust contributor: Co-Author of The 30 Second Commute
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AskJim ID: 458