Pricing Strategies: How to figure out how much to charge clients

It’s so hard to pick a number when we’re reworking our pricing strategies.

pricing strategies

We want to price our products or services at a number that seems attractive to our prospects. A number we know will give them good value when they work with us. At the same time, we need to make sure we are earning a good value for the work we are putting in.

So we hesitate. We want to charge more, but looking at that number, it seems so high.

When you are setting a price for your products or services or changing up your pricing strategies, here are some things to think about :

You are not the prospect.

It doesn’t matter whether or not you’d pay that much; you are not the prospect. You have to put yourself in your prospect’s shoes. How big a problem is it to them? What would they do if they didn’t work with you? How much would that cost? How much is it costing them to continue having the problem?

Take a couple of new business meetings and try out a bigger number — see how it goes. See how the prospects react. You might be surprised.

A higher price promises greater value.

When it comes to working on new pricing strategies, one thing to keep in mind is confidence. When you put a higher price on your services it communicates confidence. A higher price says, “I know you are going to get a lot of value from this work.” That confidence is attractive. The right prospect, who really needs you to solve this problem will see the higher price as lower risk. “If they can charge that they must be good.”

Prospects want their problem solved. They don’t want someone who is going to try to solve it. They want to know it will be solved. A higher price shows your client that you know you can give them solutions.

A higher price makes you feel differently about your services.

When you are getting paid well you are more engaged. Your commitment and focus increase. Higher prices give you a little bit of swagger; they give you confidence. That confidence, believe it or not, makes you better.

A higher price makes them feel differently about your services.

When they pay more they are less likely to waste your time. They aren’t going to blow off your meetings, or fail to do their homework or ignore your advice. When they are paying handsomely they give you more respect.

Higher prices enable you to offer more value.

When you get paid more you can afford better support, better technology, better training for yourself. Getting paid more means you can afford to spend more time doing what you are great at instead of being your own bookkeeper/admin. It means you actually deliver more value.

I can hear all the voices in your head. They’re saying, “Boy Brad, this all sounds great, but what if they say no? What if they can’t afford it? What if they don’t like me?”

This is fear talking. And that last question is the killer. Do we actually want to be “liked” more than we want to be respected and paid? Do you know what clients really like? They like when you solve their problems. And if you are solving their problems they will refer you to other people who have those problems (that can afford to pay). Nothing feels as good as that!

Every professional earns exactly what they have the confidence to ask for. (Click to tweet)

When you’re working on new pricing strategies and you are having a hard time asking for a bigger number, you need to get some support. Find a peer group, or a mastermind group where you can get feedback from some other professionals that will keep your confidence high. You need a “fan club” that can validate the work you do. That’s not your client’s job. You need to get that somewhere else.

The perfect price is going to get people saying, “Wow, I’d love to do this, but I just can’t afford it right now,” pretty regularly. If you aren’t hearing that, then you are leaving money on the table! You have to be willing to walk away from potential clients who can’t afford you to leave time in your schedule for those who can afford you. One of may sales mentors would say, “No means next.” When you hear “I can’t afford it” (and it’s not just a nice way to say no) then thank them for their time and focus your marketing on people who can afford it.

It’s hard to pick the right number when reworking your pricing strategies, but I’m willing to bet that the right number is bigger than the one you are using now!

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Photo credit: morebyless

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