From Undervalued to Unstoppable: How to Price Your Expertise

I get it – most professional services companies get paid for what they do rather than what they get done. The uncomfortable truth is that you are producing much more value than you are being paid for. All to say this: Your company can and should be compensated better for what you do – and it’s your fault that you’re not. That’s Ok, you can also fix it.

Our company prices and closes our professional services with clients at between three and five times the national average in our category.

Clients regularly say,

• “We’ve never spent this much for outside consulting.”
• “This is a bigger proposal than I was expecting.”
• “Your work will be the biggest investment we are making this year.”

Yet, our client retention and expansion rate are over 93%. Crazy bragging, right? It’s not. We just take a very different approach to explaining our services and value before we share pricing.

Professional services are purchased to solve problems. For that reason, budgets, rate cards, number of estimated hours and other mechanisms for pricing your proposals are not the best way to price for your value. The problem a prospect has is not about your services and their cost.

Price = Scale of Problem x Urgency to solve it x Impact

In pricing your services, you may be operating under false beliefs:

• Current budget determines price
• Current competitive prices determine your price
• Procurement determines price

It is the ability to convey clarity of the actual problem a customer has, the real size of impact it produces and your confidence in solving it that drives the pricing.

Customer Problems are Bigger Than They Appear

It is important to set the scale of the problem before pricing. Pricing includes Time, Size and Speed.

Relevant questions and approaches:

• “Reviewing the current issue, how will resolving it make a difference next year and the year after that?”

This allows you, the professional, to demonstrate a more complete benefit from the decision outside of a period of this year, or this budget cycle.

• What does “moving the needle” on performance mean to you?
• Why is what you’re doing not covering that gap?
• What has been the investment to get to this gap?
• How quickly do you need to “move the needle?”

All these questions push to a clearer understanding of the perceived problem that needs to be solved, what investment they are used to making and how soon it needs to be resolved.

Note: Often what we propose is outside of the budget that has been established. When we propose a successful approach, buyers can often “find money for success.” This only occurs at the highest-level Executive Sponsor.

Your prospect’s confidence secures your contract

If you absolutely knew without question that you would receive $10,000 for every $100 you invested as a person buying stocks, real estate or some other option, how much money would you invest? Remember, you know, without question, that the receipt would be 100:1. The answer? You would invest every dollar you have, and you would borrow money. Certainty dictates the level of investment. Selling is in part the transfer of your confidence to your buyer. How do we overcome fear and increase confidence? If price is defined by problem and urgency, then scale of purchase is determined by confidence in your ability to reach the desired outcome.

Regardless of the services that you sell, the lens that prospective buyers see their problem through is the lens through which they will see your price. It’s your responsibility to move their view of what their problem is and how much it means to have solved it.