Creatives, Knowledge-based Professionals, Specialists or SMEs–When your firm factors competitor’s prices into your prices, you’ve chosen the one thing that is guaranteed to kill your revenue. How? Your firm: Becomes a commodity without differentiation Is subject to every downward trend in pricing Needs more and more volume to increase revenue Three Pricing Points of View … Continue reading Do This One Thing and Kill Your Revenue
Do you ever ask yourself “Are we leaving money on the table?” Many firms successfully cover their costs and make a profit. And yet—they wonder “are we leaving money and profit on the table?” The answer is too often “yes,” and the cause is their choice of pricing model. While a solid strategy, brand and … Continue reading Value Based Pricing Cold Feet? Warm Up This Way
Do a search for cost plus pricing and you’ll get 75 million hits. The vast majority of these will state that cost plus pricing is a terrible pricing model and to avoid it like the plague. These writers assume the worst about companies’ ability and interest in doing the hard work required to price effectively. … Continue reading What Critics Have Wrong about Cost Plus Pricing
“How do we calculate the fee that’s commensurate with the value delivered?” That is THE question every services company asks when contemplating the value based pricing (VBP) model, and it continues even for firms who have adopted VBP already. Value Based Pricing is the only pricing model that compensates the provider for the life changing … Continue reading What’s the Value of an Intangible?
The tension in his voice was palpable. “I do not know how to set a value based fee and I’m afraid we’ll lose our shirt with this client.” Chris is not alone in this fear. Firm owners who are determined to adopt Value Based Pricing often face a big opportunity and challenge: a client with … Continue reading How to Avoid Being Underpaid and Overworked
When he turned 10 months old, my Bernese Mountain Dog Gabe became completely impulsive and difficult to control on a leash. He loves dogs and people and he wanted to exuberantly greet everyone who came near. He’s also over 100 pounds and is very strong. My response for 3 years was to work harder and … Continue reading How Much Could You Gain by Letting Go?
Tenacity, resolve, grit, persistence…. We see and hear these words from every source. You need tenacity to reach your goals! Resolve to put one foot in front of the other, even if your feet are blistered and painful. Grit is that internal toughness that helps you power through the difficult times. Persistence means to keep … Continue reading Tenacity and Resolve: Easy to Say, Hard to Do
Too many professional and Business services firms struggle with Value Based Pricing: they fear losing money; they struggle with how to set value based fees for individual clients; and they don’t know how to make it clear to their clients that Value Based Pricing benefits the client. They do know, however, that hourly billing is … Continue reading Disguising Hourly Billing is Still Hourly Billing
One CPA tossed deliverables and doubled revenue in one year. Would double revenue make a difference to your firm? When professional and business services firms work on their pricing, they look at what the competition charges, their own history, their industry “best practices” and expenses. They enumerate their deliverables. Where’s the client in all of … Continue reading What’s the Difference Between Deliverables and Value Delivered?
Congratulations! Your firm has implemented Value Based Pricing starting with Step 1 COMMIT, through Step 2 PREPARE, Step 3 ESTABLISH, and Step 4 TRAIN. Your providers are delighting clients with high value for a fee commensurate with that value. Your internal systems are in place ensuring that engagement agreements and invoicing support Value Based Pricing. … Continue reading One and Done or Consistent Value Over Time?