If plumbers can charge value based fees, why won’t your knowledge based firm do the same?
Knowledge is knowledge and every industry has its complexities and unknowns.
How the Plumber Does It
I called my plumber for my annual inspection and to have him fix a few things. He spent about an hour inspecting every bit of plumbing in my home, then we sat down to review his findings. He had created five options, from the all-inclusive with the highest quality parts to the economy option. And there was another option which is called Customized, and which allowed me to pick what I valued the most.
He quoted an all-inclusive price. I asked how long it might take and he said 4 hours at most but he thought he could do it all in 2.5. I agreed and he set to work.
He did finish everything, including spotless clean up, in just under 2.5 hours. I paid the agreed upon price and he left.
What Does This have to Do With You?
What does this have to do with your creative work, your professional expertise, or your subject matter expertise?
The plumber knows that value based fees:
- Demonstrate confidence that their company knows their worth. They’ve used their internal data to determine a value based fee for each type of service—in plumbing there are hundreds! —and that’s the price.
- Show they are willing to risk that some work takes longer and some work takes less. They know from years of experience how to get close enough to precision that they simply offer a repair at the predetermined value based price.
- Deliver life changing value for a fee commensurate with that value. If the work goes quickly, even better. It frees the customer to go about their other business of the day.
You Can Do This
Your own knowledge based services firm may work on complex projects that can sometimes take unexpected turns that increase difficulty and take longer than expected.
The point is not how long it takes, the point of your knowledge and expertise is that you can figure it out really well in advance and deliver the value the client wants most at a fee that is right for you and the client.
Why not get paid for delivering what the client values most rather than for the time it takes? When you bill by the hour, you’re protecting yourself from the former, but you’re shortchanging yourself in the latter.
If plumbers can thrive using value based pricing, so can your creative, professional services, or subject matter expertise firm.
Book a Starter Call and get them answered. There is no obligation following this 45 minute call. You are welcome to use what I recommend the very next day to improve your company’s business.