“When is the right time to discuss fees, Susan?” my client asked. He called after a particularly frustrating conversation with a prospect that started well and then went south.
“What is your rate?” the CEO asked, as the call was ending.
The compliance firm CEO hemmed and hawed and finally blurted out that the firm has different rates for different people and for different types of work. There is no single rate.
The prospective client challenged the idea that there are different rates for different people and different types of work.
He then said that he wanted the lowest rate.
When the CEO tried to make a case for multiple rates depending on the work, the prospective client ended the call.
When Should You Discuss Fees?
The CEO shared this conversation with me and then asked what he could have done differently? He believed that his firm of experts could have helped the prospect’s firm out the serious jam they were in.
Discuss Fees Early and In Different Ways
This CEO is not alone is finding that a conversation could end up falling apart at the last minute.
I’ve had that happen to me. I’ve learned that the sooner you bring up fees, the better the conversation will go from there.
Try this Model
Start the conversation with a few pleasantries to break the ice.
Gather a few facts:
- The business is the company in.
- What prompted the caller to call you? It’s important to listen well and prompt the caller to elaborate by saying “tell me more.”
- Describe goals were they hoping you could help them achieve. Again, invite them to elaborate.
Then say, “Before we keep talking, I’d like to give you a general idea how our firm works with companies like yours.”
“How We Work with Clients”
Keep it at a high level! This isn’t the time for an in depth tutorial on all your proprietary processes and metrics.
You should have a three step answer to How we Work with Clients.
Keeping in mind the preliminary conversation we share Trivers Consulting Group’s three steps:
- We select the right tools to meet the goal. We always begin with an analysis and report on the current state.
- We design options for next steps:
- Highest level impact affects the whole organization, including profit, accumulation of cash for investment and growth, scaling, new offerings
- Next level of impact may affect one level of the organization; or one area of the firm; one service line; one customer market.
- Next level of impact may affect one department: the financial statements and planning, e-commerce capabilities for existing offerings, or another single area.
- We include the IMPACT based fee with each option.
When I say that we include the IMPACT based fee with each option, the prospective client always asks what that is or what it means.
What follows is a conversation about IMPACT delivered and how our fees are commensurate with or proportional to the IMPACT the client receives.
What Next?
This conversation from the pleasantries to the explanation about IMPACT delivered takes no more than 30 minutes.
At this point the client is either very interested or it’s clear they are not a good fit for us. If they object to IMPACT based pricing, asking instead for hourly rates or T & M, we thank them for their interest and invite them to keep us mind.
For those who are very interested and excited(!), we continue to talk. We gather more details that will help us design the three levels of offers (as above) and the corresponding IMPACT based fees.
Your Firm Can Do the Same!
We’ve helped many knowledge services firms adopt this approach to talking about fees early. They are surprised and then delighted that it helps them avoid the conversation falling apart at the last minute.
And it also works when the firm chooses to phase in IMPACT based pricing for existing clients. They invite those clients to take a fresh look at their current situation, their goals, and what is missing that they’d like to have.
Get STARTED
You can get STARTED practicing having this early conversation about fees by booking a complimentary STARTER call with me. Text STARTER to 703-801-0345 with a couple of dates and times and we will set it up. STARTER calls typically will be scheduled within 10 days.
