{"id":53684,"date":"2018-01-15t10:30:49","date_gmt":"2018-01-15t15:30:49","guid":{"rendered":"https:\/\/48e130086c.nxcli.net\/?p=53684"},"modified":"2024-08-14t09:30:25","modified_gmt":"2024-08-14t13:30:25","slug":"11-ways-move-time-value-pricing","status":"publish","type":"post","link":"\/\/www.g005e.com\/2018\/01\/15\/11-ways-move-time-value-pricing\/","title":{"rendered":"11 ways to move to value pricing"},"content":{"rendered":"

\"\"plus: 13 benefits clients will happily pay for.<\/strong><\/p>\n

by rob nixon<\/i><\/p>\n

as you go through the journey of value belief and client value perception, you have to be conscious of price parity.<\/p>\n

more on strategy: <\/b>are your prices too low?<\/a> | 6 steps of moving to value pricing<\/a> | feel good about yourself<\/a> | how to build enduring relationships<\/a> |\u00a0they should all be \u2018a class\u2019 clients<\/a> | accountants are the last trusted advisors<\/a> | how to structure your firm for success<\/a> | why average project value matters<\/a>
\n\"goprocpa.com\"exclusively for pro members. <\/span><\/strong>
log in here<\/a> or 2022世界杯足球排名 today<\/a>.<\/span><\/p><\/blockquote>\n

if a client has been paying $5,000 for your service and even if you feel it is worth twice as much, the client may not pay much more for it \u2013 particularly if it looks like the same service. your client might pay 15 percent or 20 percent more, but double? \u2013 give me a break. unless you completely redesign your product offering so it looks completely different, your current client will have a hard time paying the price.<\/p>\n

but when it comes to new services that the client has never bought before \u2013 different story. there is no price parity with a new service that has not been purchased before \u2013 charge at will!
\n
\ni received an email from a seminar attendee one day, explaining that she asked the client, “what do you think it is worth?” the client said, “i don\u2019t know \u2013 i\u2019ll buy you lunch.” the accountant was thinking $2,000!<\/p>\n

do not say it that way. your language and how you articulate a project will often determine your clients\u2019 value perception.<\/p>\n

i play a great game with my coaching clients and seminar attendees called, “where\u2019s the value?” it\u2019s all about you articulating the value of what you do.<\/p>\n

i always start with basic annual compliance and typically the accountants draw a blank on the real value of compliance. after some prodding i get frustrated and i say, “as a result of understanding and using your compliance product, tell me what it will enable the client to do and tell me how your client can use it.”<\/p>\n

now the real value of the compliance product comes out. they say as a result of understanding and using the product the client can\u2026<\/p>\n

    \n
  1. make better and more informed management decisions.<\/li>\n
  2. increase their credit lines with suppliers.<\/li>\n
  3. appease financiers.<\/li>\n
  4. get more capital.<\/li>\n
  5. value their business.<\/li>\n
  6. mitigate risk by increasing insurance levels.<\/li>\n
  7. sell their business.<\/li>\n
  8. improve the profit in their business.<\/li>\n
  9. use it as a basis for cash flow management.<\/li>\n
  10. sleep better at night.<\/li>\n
  11. have peace of mind that their affairs are looked after.<\/li>\n
  12. increase their wealth.<\/li>\n
  13. improve their lifestyle.<\/li>\n<\/ol>\n

    amazing amounts of value in a seemingly “valueless” product.<\/p>\n

    once you<\/strong> understand how the client can use your product or what result the client can realize by implementing it, you will have a much easier job of articulating the value of your product.<\/p>\n

    at a recent coaching club meeting i asked the accountants to play the “where\u2019s the value” game and to articulate the value that they had created for a client. each accountant had to bring a current project to the meeting and tell everyone else what value the client got out of the project.<\/p>\n

    sheryl turned up with her compliance project and it had 12 points of value attached to it. i told her that was awesome and then she told me that she drew a blank and did not come up with any of them. she confessed that she emailed her client and told them that she wanted to anonymously talk about the client and could the client tell her the value that she created. the client emailed back 12 points of value.<\/p>\n

    sometimes you need to ask others what value you create.<\/p><\/blockquote>\n

    one of the reasons that you do not think in a “value that you create” way is because you are constantly thinking about activities and inputs instead of results and outputs. what i mean is you are thinking (and subsequently articulating) about things \u2013 three of these, one of these and two of those \u2013 rather than what the client gets out of implementing your things.<\/p>\n

    take the diagram below. on the left is a list of typical “things” that accountants do. they are all valid and noble services. when you just promote these activities and inputs, they have no perceived value at all to your client. it\u2019s just a shopping list on an engagement letter. when you articulate your language so that your clients understand what they get out of your inputs (right-hand side) then they start to realize the true value that you create. and so do you.<\/p>\n

    \"chart<\/a><\/p>\n

     <\/p>\n

     <\/p>\n

     <\/p>\n

     <\/p>\n

     <\/p>\n

     <\/p>\n

     <\/p>\n

     <\/p>\n

     <\/p>\n

     <\/p>\n

     <\/p>\n

    spend more time speaking in a language that the client understands \u2013 what\u2019s in it for me \u2013 rather than in a language that you understand.<\/p>\n

    if there were a magic formula this might be it.<\/p><\/blockquote>\n

    to settle on a price, work out what tangible results a client gets from using your service, work out (by asking them) what other intangible benefits they will receive, then settle on a price that is a good return for you (based on your value contribution and the intellectual capital you bring to the table) and a dramatic return on investment for your client.<\/p>\n

    there are 11 critical things you need to do to get rid of time-based billing and move to a value-pricing model.<\/p>\n

      \n
    1. realize and believe your services are worth more.<\/li>\n
    2. find the courage to charge more.<\/li>\n
    3. increase all prices immediately.<\/li>\n
    4. offer additional services at the time of buying.<\/li>\n
    5. have set prices for repetitive tasks \u2013 a standard menu of services and price list.<\/li>\n
    6. price in advance, not arrears.<\/li>\n
    7. articulate the value of each project eloquently.<\/li>\n
    8. get rid of low-margin services and low-margin clients.<\/li>\n
    9. improve your language and sales skills.<\/li>\n
    10. target more profitable clients and services.<\/li>\n
    11. use value-based fees \u2013 not time x rate!<\/li>\n<\/ol>\n

      when you adopt these methods your profits (and enjoyment levels) will improve out of sight. the diagram below shows you the impact of this model using a very small client who has been paying $5,000 for basic compliance services. follow the diagram left to right.<\/p>\n

      \"diagram<\/a><\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

      once you follow this model you will never look back. your clients will be much happier and so will your bank account.<\/p>\n","protected":false},"excerpt":{"rendered":"

      do you know how much better off your clients are?<\/strong>
      \nby rob nixon<\/em><\/p>\n","protected":false},"author":1840,"featured_media":49750,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","footnotes":""},"categories":[2741,2254,2274,3120],"tags":[4278,3958,4281,4283],"class_list":["post-53684","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-checklist","category-growth","category-pricing","category-pro-member-exclusive","tag-billing-rate","tag-cpa-billing-rates","tag-fee-structure","tag-pricing-rates"],"acf":[],"yoast_head":"\n11 ways to move to value pricing - 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