How much should you charge for your products or services? This is an intense and complex question, yes? It probably brings up thoughts and fears about competition, worth, value, being liked and accepted, scarcity, and security. There are lots of approaches to pricing and they all have merits. Here is a principle you can use to navigate to your answer.
“Set your price so that you feel that you are getting well paid and your clients feel they are getting a bargain.”
I picked up this gem from Alan Weiss’ book, Million Dollar Consulting
This principle works because it honors both you and your client. If you agree to a price that harms you, you will feel bad. If you agree to a price that harms your client, they will feel bad. Straightforward, yes?
Feeling bad is an impractical way to start a partnership with anyone. It undermines your and your client’s ability and desire to create a successful outcome and extend the relationship beyond this project or sale.
To set a price that follows the principle, you must know
- what price range would have you feeling your are getting well paid, and
- what value your client would realize and recognize by using your product or service.
The first part is relatively easy. You can know what range of prices would feel best for you by checking in with your feelings. What would feel good, really?
To learn what value your client would derive, ask them.
You could have a conversation that starts like this: “Conservatively, how much money would this (product/service/project) save or generate for you?” Then set your price as some fraction (10% for instance) of that amount. Allan Weiss, in his book
In your corner,
Mike