If you’re a service professional, the industry norm is probably to charge an hourly rate. However, this tends to make clients overly focused on your hourly rate, making them too price-conscious. It would be better to focus them on the value of the services you’re providing, rather than what you are charging per hour.
How can you get around this? You could offer your services in various packages rather than providing an hourly rate. For example, say you are in the business of providing solutions to small business for virtual support services. You could stick with the industry norm and provide an hourly rate, tracking your time and charging by the hour. Alternatively, you could package together services that are ‘project specific‘, such as setting up a social media profile, a newsletter or blog. You could call each package something like ‘newsletter maintenance’, ‘social media maintenance’ or ‘blog maintenance’. So how do you achieve this without pricing yourself out of the market or losing money if you haven’t priced your packages correctly?
Break down the tasks associated with each package and estimate the time it takes to complete those tasks. Apply your internal hourly rate and calculate the dollar value of the package. You may need to tweak your package by adding or subtracting components with the ultimate aim of offering value for money to the client.
For example, you may estimate that it would take you 5 hours a month to maintain a client’s blog. You charge $40 per hour for this kind of service, which makes a total package cost of $200 per month. Over time, you will get more efficient at completing the work, perhaps only taking 4 hours a month to achieve 5 hours worth of results. This means that your hourly rate is effectively now $50 per hour but you’re still charging the set project fee of $200 per month. The idea behind packages is that if you have been able to develop your own internal efficiencies, you should be rewarded for this. However, if you charge your standard hourly rate, there is no potential for making use of your increased efficiencies and you are paid purely by the hour!
Taking this a step further, you could offer 3 month or 6 month programs, which have the benefit of getting the client to commit on a longer-term basis. They could pay upfront or make automatic monthly payments which would keep your cash flow healthy. Show them the value of a six month program and what the ‘result’ will be at the end of the program. Creating shorter and longer programs at different price points will make it easier to sell your programs.
Or you could upgrade an existing product/service to a premium version. By creating differing levels of products and services you’re giving your clients choices but not making things too complicated. It’s quite simple, they either choose level 1, 2 or 3 so you’re effectively take the indecision away and making life easier for them!
The more programs you can create which do not require lots of your time, the greater the leverage you will get on your programs.
Think about including ‘freebies‘ with your package that do not cost you much but present tremendous value to your clients. The package has to have a perceived value that far outweighs the price. How about putting together a free ebook about social media or blogging? You’d be surprised how much information you have stored in your brain which would be of huge benefit to your clients. Pick a topic and start writing, just as I am doing here from the comfort of a cafe with a latte by my side.
Use a notebook and jot down bullet points of all the subtopics that appear in your head after writing down the main topic. You’d be surprised how easy it is once you get into the flow. If you’re wondering why anyone would want to read your ebook if there are already other ebooks out there on the topic, the fact is you’ll have your own unique spin on it. We all process and piece together information very differently. If you still don’t feel that you can write, you could speak your topic out loud and record it. Get it transcribed and with some editing, you have an ebook!
Or perhaps you can take your knowledge and create a ‘signature’ product. Think about the systems that you use to run your business – the systems or know-how that make you different from anyone else in your field. For example, I created a product called Bookzkeeper, which helps small businesses organise their financial paperwork. By creating this product, I am leveraging my knowledge to the fullest. I have set things up so that people can purchase the product from my website, which means that I do not actually have to be there to sell the product nor does it require any input of my time.
Of course, I’m making it sound super easy and it does require time and effort to create and set up a product. However, with time and effort it is more than possible, you just need to be willing to get your work out there. The exciting thing is, you’ll reach many more people than you would otherwise. It will not happen overnight but the results can be very rewarding.
P.S. Want to learn more about leveraging your time?
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