Episode 128: Power Move – Pricing like a Boss
If there’s one thing bosses struggle with, it’s pricing. From charging what you’re worth to you’ll never get paid to do that…there’s no shortage of opinions when it comes to pricing your services.
In this episode of the Small Business Boss podcast, I’m diving into how to price your services like a boss.
Pricing is such a loaded and sensitive topic. We don’t really talk about money and then we go into owning a business, and we have to talk about money ALL the time. This is a topic that’s pretty contentious, and honestly, rather ridiculous at times.
Also, it’s a topic that gets me fired up! There’s so much bad BS advice out there that we wanted to dedicate an entire show to pricing.
Before we dive in, this episode is brought to you by the Profitable Pricing Guide and Calculator. You can grab this free resource to figure out your pricing along with a handy calculator right here:
Let’s start with the thing that gets me going when it comes to pricing.
People boasting about making $1000 or more an hour. I mean, good for them if they really do. But if you NEVER sell anything at that price, you don’t really charge that, and you’re full of beans.
Here’s the truth: $1k/hour consultants don’t have to talk about it on Facebook — they’ve got better things to do.
The truth is, it’s simple supply and demand. We’re talking about what I learned in my high school economics class.
The more commoditized your service, the harder it’s going to be to command premium pricing unless you’ve got something special to bring to the table in terms of approach, vision, or experience.
The more specialized your skill set, the higher the price you can charge. If this skill is needed, you’ll be able to make it work.
That’s why charge what you’re worth isn’t good advice. Because how much are we all actually worth? There’s no price-o-meter to help us figure it out. (Well, with my pricing calculator, there kind of is….)
Honestly, that’s just the start of the pricing problems. Getting your pricing nailed is one of the MOST powerful things you can do in your business.
You can’t just make it up as you go. You need a plan.
So, how do you create a plan for pricing — points for discussion:
- Think about the message your price sends. Pricing is positioning
- Understand the “non-billable” costs that need to be factored into your price. So many times we miss these things and low ball what we should be charging.
- How “proven” is what you’re offering? Can you back up the price you’re asking for? What results do you get your clients?
- Know what your comparables would be. Not to copy but as a point of reference. Knowing what’s going on in the market is important — even if you’re a category of one. (And many times it can help push you to charge MORE.)
- What’s the mid-to-longer term plan for this? How do you want it to be priced a year from now? Create a pricing plan where you stair step your prices over time prevents you from plateauing. If you offer retainer or ongoing services, build a price increase into your plan. Periodically, the price should increase for clients. And if you have long-standing clients on a lower price, you need to do what you can to bring their rates up to your current ones.