 |
|
|
|
|
 
|
Practical Help to Grow Your Business
|
|
The Concept of Fees and Prices - Part 2 |
| |
What Do You Do?
If you consider yourself to be a Professional Service Provider, or a Professional Knowledge Worker, what exactly do you do for your customers? Sure you 'add value', but how does the customer perceive the results of your effort?
Although Professional Service Providers don't supply commodity 'stuff' or tangible goods, they still need to be wary of how they, and therefore their customers, view their services.
“Sure you 'add value', but how
does the customer perceive
the results of your effort?”
What Is A Service Business?
A service business charges for activities, such as fixing a leak. A higher level of service business might charge for the time a customer spends with them, for the 'experience', such as an evening spent at the theatre.
But a Professional Service Provider operates on an even higher plane, causing the customer to demonstrably achieve certain outcomes. Professional Services are 'transformation' businesses.
The customer holds the Professional responsible for guiding the transformation, but if the customer is not willing to follow the advice given, the results and thus the value outcomes are impossible to achieve.
“Professional Services are
'transformation' businesses”
It is crucial to accept that there is absolutely no similarity between guiding a transformation and a selling a commodity product, or even a bundle of services. In facilitating a transformation, the professional is 'touching the customer's soul' and by touching the soul the Provider becomes virtually impervious to competition.
Setting Your Prices
Presumably if you set your price way above the customers' perception of the value they'd get from the purchase, you won't sell anything. And if your price is only a minute fraction of the value, you won't sell much either because people will think they smell a rat.
The problem with trying to fix a fair price is who decides what is fair? For a start, never allow competitors to determine your prices. They have no interest in your long term survival.
“The problem with trying to fix
a fair price is who decides
what is fair?”
Price Your Customers
Price your customers, not your services, so that you are dealing with those who get the most value out of working with you. Don't neglect the section of your niche where price is of no consequence, but before you charge a premium price, make certain you believe you are worth it.
There's only one profession that says, 'Pay me and I'll fake it," and that's the oldest one in the world!
“Before you charge a premium
price, make certain you believe
you are worth it”
 
Copyright ©2011 David Winch
All rights reserved. |
|
|
