One of the reasons consultants underprice themselves is that they are worried that consulting clients will say no to their price.
But if you did your homework about your market to validate that what you can help clients achieve is valuable—and valued—in your market…
And you made sure your price is positioned correctly within the range of what clients are paying for that value in your market…
Then the problem is not your price. Right? That’s worth repeating.
The problem is not your price.
Likely, you need two things:
Belief that what you offer and can do is worth it
Strategies and techniques for presenting and negotiating your price
A Value Mindset
I know it can be difficult to embrace that not only will people pay you well to help them, but that what you charge is worth it.
When I first had to tell a client my price, I was embarrassed. I didn’t set the price; the firm I worked for did. So I didn’t have a choice. And thank goodness! Because, even though I could not at that time wrap my head around someone paying me that amount, most prospective clients didn’t push back—didn’t even flinch—when I said the price. The ones who did generally did so because of their budget limitations, not because they didn’t think what I could do for them was worth it.
As with most new things you have to do as a consultant, you have to start with shifting your mindset. Your mindset is your beliefs, attitudes, and habits of thinking about yourself and reality.
When it comes to price, distorted beliefs about your self-worth often creep or leap up. One way to handle that is to separate your price from yourself. It’s not the price for you! It’s the price for the value of the outcomes you can help clients achieve. What you can do to help clients avoid a bad outcome or achieve something they aspire to is what they are paying for.
So when you think about price, think of it from the clients’ perspective. Focus on the outcomes. Not you.
Of course, if you are struggling with feelings related to your self-worth, please address those! You’ll enjoy your life more, and it will help you do things that consultants have to do repeatedly to be successful, such as setting boundaries, negotiating contracts, and managing client expectations.
You can also continually gather evidence of the value of what you do for clients. One person I coach keeps a spreadsheet where they enter accomplishments, compliments from clients and prospective clients, and outcomes they helped achieve. If they start to build a case against their own value as a consultant, they look at the spreadsheet, which keeps getting filled with more goodness. Plus, they use the outcomes they captured when they prepare for prospective clients!
Presenting and Negotiating Your Price
Once you believe your price is worth it, it’s easier to present it to clients confidently. But there are other strategies and techniques that help a client embrace the price you present to them. There are three critical ones.
Resist Pressures to Name Your Price Too Soon
Never wing it when telling a prospective client your price. And they often want you to. I’ve repeatedly been in initial prospective client meetings where they say they want my help, we discuss the scope, and then they want a price. Then and there. Resist doing that!
Unless you have an off-the-shelf price for a predictable engagement, it’s better to take the time to consider what the value is and what it will truly take to achieve their outcome before you name your price. It’s too easy to lowball yourself because you want to please them or you haven’t thought through the details enough. I generally say, “Let me go back and do this thoughtfully so I can give you a fair price that I know will work for you.” Most of the time that works.
However, sometimes they say, “Just give me a ballpark or a range!” I get why the want that. It relieves their anxiety, especially if you’ve done your job and made them eager to work with you. But, again, resist doing it! Why? Because people get attached to the price you give, even if they say they won’t. It’s just what happens. So if after the meeting, you realize the price you gave was too low and tell them that, they will experience it as if you are raising your price! And you will be negotiating with the price you gave and not relative to the value you can provide.
Price Without Apology
It might seem like you are being empathetic when you state your price and then apologize for how high it is. However, you are instead signaling to the prospective client that:
You don’t believe the price is worth it, and
You are willing (even eager) to lower it.
Again, if you did your homework and know your price is reasonable for your market, don’t apologize for it. Stand by it.
If they have budget limitations, that is their limitation and has nothing to do with your price. If they can’t afford all the value they want, you can negotiate the scope.
In these instances, I do not even use the word price. I say that I am happy to figure out a scope with them that fits within their budget and helps them accomplish what matters most to them. That shows them that I understand them and their circumstances, am flexible, and care about them. But it also signals that we have to negotiate the scope and outcomes to match their limitations. If you can come to an agreement, they get the value that they can afford, and you get paid for all the value you will deliver.
Marry Price and Value
The first is never to separate the price from the value to the prospective client. Don’t assume that they will connect the price and value. You have to do it for them. So always lead with statements about the outcome you will help them achieve and the value of that outcome to them.
This is in contrast to stating your price and then listing all of the activities you will do for that price. That makes it easy for a prospective client to think that the price is for activities instead of the outcome.
Certainly, they want to believe that you know what to do to achieve the outcome, but you don’t want them to default to assuming that it is the activities that they are paying for. For example, if you are going to do a training, I would state what the outcome of the training is first. What will the people trained know and be able to do as a result of the training and how does that lead to the outcome they want to achieve. Then present details of the training followed by the price.
Keep Learning
If you apply these strategies and techniques, you’ll be ahead of the pricing game and will hear more yeses than nos. But never stop learning more. Keep track of what is happening in your market and what justifies your price. Learn more about how to effectively negotiate. And, of course, keep working on your mindset to keep it working for you and not against you!
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