Does what you are charging as a consultant match the value clients are getting from you?
Have you taken the time to determine the value of what you can do for clients and what they are willing to pay for that value?
These are critical questions to ask yourself when you are first starting and as you reevaluate your price. But, you need a good working definition of value. Why? Because it's easy to think that your value is how you feel about your value or worth or what your previous employer paid you.
But that's not what value is. Value is what clients are willing to pay for what you can help them achieve.
Mindset Traps That Cause Underpricing
If you aren't clear about what your true value in your market is, you can get stuck in common mindset traps, which cause you to underprice yourself.
What is mindset? Mindset is your attitudes, beliefs, and habits of thinking that tell you what you think is true and not true about your environment and yourself.
The two most common mindset traps that stop you from pricing yourself right are:
A lack of confidence, which usually means you do not believe that your services are worth enough to command an appropriate price.
Perceived scarcity, which usually translates into not believing that there is enough work out there.
Getting Out of the Mindset Traps
But these are just traps. The good news is that gathering the right intel is your best way out of these traps! How? You need to interrupt and interrogate your narratives—the stories that your mindset is telling you—and replace them with real-world evidence of what is actually true. The more you do this, the easier it will be to get out the traps and form better, more reality-based habits of thinking.
If having enough confidence is an issue for you right now, then my advice is: don’t trust yourself. Don't trust your lack of confidence! Instead, take the time to clarify the value of what you can do for clients. Then get input from other people who know you, know your market, are honest and have enough confidence themselves.
If perceived scarcity is your issue, know that it is generally caused by unvalidated assumptions. You know, the assumptions about your market and the value of what you can help clients achieve that you have not verified. The best way to verify, adjust, or eliminate your assumptions is to do research about your market.
Get intel about what clients have a demand for in your market that you can help them achieve and what they are willing to pay to satisfy that demand. If your market has a source of professional market research that is specific enough to help you price your value for your specific market and niche, you can use that. If not, I have found one of the best ways to get enough intel to help you make a decision is to have conversations with clients and consultants in your market.
Compete on Value Not Price
Another trap that can cause you to underprice yourself is believing that you can only get clients if you compete on price. That means, positioning yourself in your market as a low-price alternative. The problem with this is that it becomes your brand. You will be known in the market as a bargain, the lowest price.
What you really want to be known as is the highest value. The consultant they want to get because they can get tremendous value! The one who is worth every penny! You get what I'm saying, right? A low price also comes with mental baggage. The truth is that, even if clients hire a low-price consultant, they will believe they are getting less value. And that feeling is hard to shake.
So if you deliver premium value, you should charge a premium price. And then just make sure that that's what you deliver in your market. If you do that, your clients will become your best marketers. They will tell people in your market that you and your price are worth it!
Want to learn more about pricing strategies? I recently taught a FREE 90-minute training webinar on How to Price Your Consulting Services so you can find your pricing sweet spot, choose the right pricing model for the right situation, get clients to say yes to your price, and get paid for your value.
You can find a link to the replay here: