If you know you should have put your fees up a long time ago but have been putting it off because you’re not quite sure how it will go down with your clients, Faye Watts, founder of London accountancy firm www.FuseAccountants.co.uk has some advice on why and how to do this.
You are worth it
If you need to be convinced that you should be putting your prices up, take a look at all the preparation that goes into your work, the clearing or following up afterwards, and, of course, the travel. I was working with a client who was hiring out some very nice rooms in Harley Street to see her clients. They were paying a significant amount to see her but, after travel to and from the clinic and room hire, she might have been better off working from a local room. Her prices needed to reflect the premium location and her time as a premium provider.
Don’t Be Apologetic
Practise saying your fees in front of a mirror and adopt good, strong body language as you do so. Your feet should be well grounded, your body strong with good posture and eyes looking straight at your client (or mirror). These are your fees so get comfortable asking for them. Don’t dither, be clear, concise and confident. You can even find someone to role play with for extra practice.
Get Into the Driving Seat
Show your potential client how you will earn your worth. Ask questions and dig deep to find their motivation, their pain, what they’ve tried before. What do they want from you and why? Show and tell them about all the value they will get…even go into added value to differentiate yourself from your competitors. Tell them that is why you are worth X amount.
Avoid financial negotiations if you can but if you have to do them a deal can you add in value instead? Never reduce your price more than once: asking for a discount is acceptable, pushing you for another is just rude.
However, there may be times when you really want to work with them and they can’t afford you at the moment. Just tell them this. “I really want to work with you so I’ll do you a special deal at xxx but let’s reassess in 6 months’ time and see how it’s going.” That gives you the chance to stop working for a lower fee gracefully if you need to, but also for them to see how wonderful you are and decide to stay with you and pay a little more.
Make it easy
Make the sale easy. Show them how to sign up and send the link. Give them your bank details, PayPal link or a link to setting up a direct debit as soon as possible. Follow up that sales conversation with everything they need to be able to start working with you straight away.
Know your Fees
Have this written down if you know you’re inclined to waiver. It’s much less likely to happen if you are reading off a list and it’s already there in black and white. Never ask “what’s your budget?” by the way, that just sounds like you are eying them up for how much you can get out of them. Keep a menu system so you are clear as to what each service or product costs.
Accept that some people may not like this. You will put off some new clients and may even lose some old ones. But, do the maths.
If you put your fees up by 10% but lose 10% of your clients, you may even earn roughly the same but do less work for it. If you bill more and work less, surely that’s better?
Look at your Lead conversion
Ask yourself if nearly all of your leads are signing up with you, is this is a sign that you might be too cheap? Lower your lead conversion rate and don’t see this as a sign of failure as not everyone will be able to afford your service.
Don’t explain too much
You don’t need to tell people about your holiday to China/increased rent on the office or new member of staff. It’s fine to say we’ve made some investments in the business, so our fees will be going up by X.
If you are producing products you may need to explain why you’ve used this particular material and it has cost x amount. You don’t need to defend yourself though. Just be matter of fact and set out your decision.
Make a choice
Choose whether you increase it incrementally or all at once. This may depend on your clients. If your clients are individuals or small business owners, putting your fees up incrementally may be more manageable for them. If you are working with corporates you may have more scope to make the jump in one go, unless you were specifically hired on price.
You also have the choice to keep old clients at the existing rate and charge new clients the higher rate, but perhaps giving old clients a heads up that their prices will increase at some point in the future. This is an ideal time to ask for feedback on what you could do to make their service better.
Use it to evaluate your whole business
This is also a good time to look at your clients as a whole, examining who are the ones that pay on time and a pleasure to work with, and the ones that you have to chase or drain you of your resources. If you have someone that regularly uses up more time than they should, you could move them to a fixed fee package (on direct debit or standing order if they are bad payers) and charge them for extra time incurred.
If you’re not quite sure how much time you are spending on your client try keeping timesheets to analyse it. You may be surprised. This is a good exercise to do for the whole of your business. You may find that you are spending your time answering questions by email which could be just as easily put into an FAQ for the website and there you have it, more billable time released.
There are plenty of Apps and systems you can use for this.
Don’t let your own perceptions hold you back
You may think “I’d never pay £X for X” but there are people who will. Don’t look at your potential customers through your own beliefs and view of the world as it may hold you back.