How Not Raising Your Fees Can Cause you to Resent Your Clients- What to do?
Posted in Business Strategy, Charging for your services, Entrepreneurial mindset, Mastermind for Success, Sales/Marketing and tagged with business model, Business Strategy, charging what you are worth, knowing your value, success mindset on 06/11/2010 07:50 am by Therese Skelly
As I described in my previous post, mindset can play a huge role in the money business owners generate. Another place to look for some money leaks is your pricing model.
Since my main market is the service provider, I’ll address that in this article.
Usually for service providers, we start by looking at either the fees per session, or what kind of packages/programs they are offering their clients. Too many people are still stuck charging hourly. I know this one well, having been a psychotherapist for decades! The problem here though is that you have to constantly be selling. One of my sub-niches is holistic practitioners, so let’s use an acupuncturist as an example. If you have a fee-per-session model, at the end of the treatment, you have to get your book out and ask them if they want to reschedule. Hopefully your client is “blissed out” because of the amazing treatment you just did, but what if they are in a rush and have to pick up their son from school. You will likely hear….”Oh, let me call you soon.” Then they get busy, or sick, or short of cash, and you lose the business.
Compare that with the holistic practitioner who has a six month PROGRAM. I like to structure this where some of the money is paid up front or there can be payments made, but folks know that they are paying for a longer term commitment and seem to have more “skin in the game” because they are paying even if they aren’t coming. (Of course we’d prefer that they come!) It works for them because the understand that you are holding a bigger vision that just a one time fix, and it works for you because it levels out your cash flow because you don’t have to constantly be selling and getting new people in the door.
Now let’s look at your model. Where do you see that you could make some tweaks?
And the final place we will talk about here is you owning your value. Have you done that yet? What is your time and expertise worth? The way to understand this is to look at the results your service gets for people. These are some questions that will help you get what you do in a bigger way:
What results to people get after working with you?
What problems do you help solve?
What did those problems cost them?
What intangibles (like confidence) do you provide?
What’s that worth to get?
What’s the lifetime value of the work you do?
What has not working with you cost them?
I guarantee that if you would take 20 minutes and just do some journaling on those questions, you will never again devalue yourself! Make time for this ever important foundational piece so both you and your clients have a better experience.
By the way, if you have any questions, feel free to shoot me an email at Therese@HappyInBusiness.com. I’d love to hear from you!
Blessings,
Therese
June 13th, 2010 at 9:52 am
Theresa, you raise some great points, and the questions to journal are really, really hard for me. This is where I get bogged down, figuring out those nebulous, metaphoric, energetic things like value. Will you address that in a future posting? That would be so helpful!
Liana
June 29th, 2010 at 10:32 am
So many people think that they cannot break from hourly work because of this or that. It’s strange how our own beliefs can keep us from growing. I am a fan of packages and programs because it truly empowers the client and consultant relationship. Clients say they feel “held” and “supported” knowing they are in a package or program. And yes, less selling and less being sold to! Who doesn’t like that?
I love the idea of taking a moment and answering the questions you outlined–and I think I will later this week. These are the kinds of questions that people don’t ask when they are rushing around doing the day-to-day work of helping clients and managing their business. Thanks for all of your amazing food for thought, Therese. Always helpful to read your words.
.-= Karrie Kohlhaas´s last blog ..Should I wash my mouth out with soap =-.
June 29th, 2010 at 10:04 pm
You are so right Karrie.
The constant selling cycle is really draining, and I think we do better work if we know we have more time with our clients.
maybe I need to go back and answer those great questions!
Look forward to connecting with you soon.
June 29th, 2010 at 10:05 pm
HI Liana,
Of course I’ll write about it in a blog post!
Thanks for the feedback.
Big hugs to you.
June 30th, 2010 at 10:14 am
Hi Therese,
I just love your brilliance. Thank you for sharing your thoughts and the who you are with the world. You are magnificent. And, yes, I have to think about selling as promoting my passion or it doesn’t happen. And, I like the long-term model MUCH better! Once again, I appreciate you sharing your wisdom and making me think.
October 23rd, 2010 at 1:48 pm
[...] that we’ve visited what’s going on in your head, click here to read the next post where we’ll talk about what’s going on with your pricing. [...]