In the beginning, no one calls you. The supply of you is abundant, the demand is flat or non-existent.
You set your prices low and you get a client. You keep your prices low and get more clients.
Your supply of time becomes less, more people want to work with you. There is more demand for you than supply of you.
You can either add more supply by hiring, or you can raise prices to reduce demand.
Prices can only go up so much before you price yourself out of getting the work, and you can only hire when your revenue is high enough to support it.
You must understand this dynamic in order to grow beyond a one-person shop.
*Obviously, this isn’t a comprehensive economics class, it is a lesson in how supply and demand will matter to an entrepreneur building a service business from scratch.