I get at least a half-dozen emails a week from fellow consultants and freelance professionals wanting help charging appropriately for their services. When I do office hours, it’s by far the most common topic of discussion.
They’re dismayed that they aren’t getting paid for their time, or that they feel like they’re spending too many hours giving away free advice and not nearly enough time actually providing the paid expertise that they built their business around.
I’ve responded with varying forms of the following advice so many times that I thought it was time to put it in a post.
It’s not for the faint of heart. Tough love up in here, but it’s honest and comes from me really and truly wanting you to be better at this. Because when we all improve how we position ourselves as consultants and professional service providers, it’s better for everyone.
I’m only qualified to tell you any of this because a) I own a services firm and b) I make money doing it. You’ll have to take from it what you will, and while your mileage will almost certainly vary, my caveat is simply that this is what works for me and many of the professionals that have given me advice and guidance over the years.
Cool? Cool. So here goes.
1. Get better at qualifying your prospects.
You must. Ask. Questions.
Lots of them.
Especially at first. No one is born knowing how to qualify a prospective client for their business. You learn it by asking lots of questions, then keeping track of what you wish you’d known ahead of time during the course of each project or engagement.
This can be anything from a few questions via email to a 30 minute phone call or coffee if you’re up for it. But you need to do something important.
Take these meetings with the express understanding from the prospect that you need to know a bit more about them before you can give them a whole lot more input. The outcome of the meeting needs to be about information gathering and discovery for you, not a session for them to pick your brain.
Make sure those roles are understood. There are plenty of ways to do that politely, and a savvy client will thank you for doing it so that they’re sure you’re a good match for each other.
2. Learn to package offerings.
Think beyond hourly rates.
What are people charging for webinars? Conference passes (and thereby individual sessions)? Look at offerings outside your industry and vertical to understand how people are packaging and selling what they do.
Offerings should be as concrete as you can make them, as straightforward price-wise as you can manage, and very clear on the deliverables.
There are such things as long-term, open-ended consultative engagements that are on retainer. Those are not usually where your clients will start with you, since those kind of relationships are very much dependent upon trust and proven outcomes before they’re a comfortable arrangement for either side.
Can’t get that clear around a project at the start? Propose a finite consultative agreement for 60-120 days, the sole purpose of which is to provide some on-the-ground guidance and help define a future project that can be more accurately scoped.
3. The market will decide whether you’re pricing in the ballpark. Listen to it.
Do your research.
Then price something and attempt to sell it. To your existing clients, to your new clients, it doesn’t matter. But the one and only test for whether something is priced right is whether it sells.
Pricing strategy is the most difficult thing in business.
If people don’t buy, either the offering isn’t right or the price isn’t right or both.
Ask for input. Keep track of it. Watch what people say, and pay even closer attention to what they do. Are they cool with spending a few hundred for an assessment of their situation but scared of some big, open-ended agreement with lots of dollar signs? Then your pricing needs to be somewhere in between, with offerings that are scoped to match.
If, after a while, people aren’t buying what you’re offering, it’s not them or their unwillingness to pay or their disrespect of what you’re “worth”.
4. Quit doing work for free.
This is your responsibility. If you don’t want to work for free, stop doing it.
Tough love: 90% of the people that are writing me concerned about how to get paid what their time is worth are making one fundamental mistake. They keep taking work that provides “exposure” or “opportunity” thinking that next time it will be different. Or they get so desperate to get any business that the bar for what constitutes a business development opportunity slips endlessly until anyone with a pulse seems like a viable prospect.
You are the only person that can stop this pattern.
If you think your time is valuable, you must determine how to evaluate opportunities and when you will move the discussion to money.
See #3 for how that strategy will course-correct if you pay attention and respond to the patterns that you see.
But if you want to get paid for your expertise, you must be very clear that that’s the business you’re in, and build accordingly.
5. Learn how to respond to requests for your time.
“That’s absolutely a challenging problem, and I work with several clients on just that sort of thing. I’d be happy to send you a quick overview of what I have in mind to help you, and the costs.”
“I’d be delighted to meet with you on a one-time basis. I have a half-day, single shot offering for just occasions like this. I’ll come in, do an education session for your team on a topic we choose together, and then we can do open Q&A for the remainder of the time. That’s a flat fee of $XXX. Is that something that could work for you?”
“I certainly have some input about how you could approach that problem. Here’s a couple of blog posts/ebooks/whatever I’ve written that tackle that topic. If you’re interested in some more specialized guidance where we can get into more depth about your particular situation, I’d be happy to talk about setting up a learning session. They’re usually about $XXX and there’s no commitment to work together, it’s just a chance for us to brainstorm on the spot about things that could help you.”
Get the idea?
Stop being afraid to state unequivocally in the conversation that your time is something you earn money from. It’s a perfectly valid business model that people have been using forever and ever.
If you’re surprising someone with the idea that your knowledge is your product, are they really the kind of educated client that you think you can establish a respectful and mutual partnership with for the long term?
6. Deliver a valuable product or service. But know what “value” means.
Value in a knowledge market is determined by having expertise and experience that will help someone improve their life or work more effectively than they would be able to do on their own.
Sometimes it’s about speed of execution. Sometimes it’s about making better decisions with more comprehensive knowledge. Sometimes it’s about sheer depth of expertise and specialization in an area or on a project that would make hiring a full-time staffer prohibitive for someone.
And you know who tells you what’s valuable? Your prospects and customers. No one else. You can think and say you’re “adding value” all day long but if your clients don’t perceive it that way, your fees are always going to be too much no matter what they are.
You don’t get to say what’s “value added” until your clients are willing pay for it and they’re glad to do it. It’s that simple.
The super secret bonus answer: if you care — really and truly — about delivering something of worth to someone else, you’ll find your way. Giving a shit about the success of your clients is still the ultimate differentiator.
Now Let’s Hug It Out
Here’s the thing.
You didn’t become a knowledge worker for no reason. There is nearly an endless market for expertise that people have. The limitation is what people are willing to pay to have that knowledge for themselves. But there is value in knowing things, inherently.
Truth is that I think you know what you need to do. The gap is always between knowing it and doing it.
Yes, you’re going to screw it up. Sometimes you’re going to give away too much and eat your shirt. Other times you’re going to hold back and miss an opportunity because you were too protective of your time. You’ll get walked over. You’ll get alienated by someone who can’t believe you had the audacity to quote them a price. It happens to all of us.
This is more art than science, but the beauty is that none of it is permanent. You test, you adjust, you test again. You change things up. And you find what works for you.
But you have to do it. No one is going to do this for you.
We never said that being in the knowledge business would be easy. If you want it to be worth it, you have to make it worth it.
Now then. Go forth and conquer. We’ll be waiting.