Setting your prices as a coach or consultant isn’t easy, but making pricing mistakes sure is.
No matter how great our intentions are, there are tons of ways we can get in our own way with pricing. Here are the 7 top mistakes I see coaches and consultants make when pricing services.Confused about how to set prices for your coaching or consulting services? Don't make these 7 pricing mistakes! Click To Tweet
Not understanding your value.
Your potential clients need to know how they will be transformed by the work you do together. That’s the value you bring. Not your degrees, certifications, experience, (or anything else about *you*, TBH). Your value is all about what’s in it for your client. (If you want to learn more about this concept, check out “Building a StoryBrand.”)
Your value is your starting point for pricing. And that will be different for different types of coaching, consulting, and clients. Think about which of your services deserve a premium, too.
Comparing yourself to others.
While you don’t want to be completely out of touch with what other folks are doing, your prices should reflect the unique value of what you provide rather than what someone else brings. (Or, as my mom would ask, “If everyone else is jumping off a cliff, would you?”)
Billing by the hour.
It’s tempting to go the hourly rate route, but don’t. Using an hourly rate creates an “opt-in/opt-out” decision for your client each time you meet. That may prevent your client from fully dedicating themselves to the work you’re doing together, or discouraging them from contacting you when they really need your expertise. And many folks have ideas about how much an hourly rate should be, based on their experiences (“My attorney/plumber/doctor/architect doesn’t make that much!”). To avoid hourly rate justification conversations, take the hourly rate out of the picture.
Instead, try bundling services together to create a package. For example, you could bundle a strategic planning session with a change readiness assessment. Or coaching sessions, plus a 360-review, 3 leadership books, and email access to you between sessions. What would be helpful for your clients? What would they find valuable?
Trying to be the low-cost leader.
There will always (always!) be someone providing similar services to yours at a lower price. It’s not a race to the bottom.
It’s easy to price your services too low to begin with, thinking that you need to be at the lowest price point to attract customers. However you choose to position yourself, you do need to align your pricing with the value you bring.
Nickel-and-dime-ing your clients.
Don’t charge your clients separately for credit card processing fees, videoconferencing costs, parking expenses, or other costs of doing business. If you want these types of expenses covered by your client, incorporate them into your package rate (without making them separate line items). These small(-ish) fees can feel petty to your clients and create unnecessary snags when they’re making significant investments in your services. Aim for frictionless.
Not knowing when to raise your prices.
One great indication of your prices being too low is being too busy and/or having too many clients. If you’re priced way too low, though, the opposite can happen — clients sometimes use price as an indicator of quality, and they may not see you as a serious expert worth investing in.
Once you realize you need to shift your pricing, get it done! Even if you just raised prices 6 months ago. Or even last week. Decide and act. You can always course-correct if things don’t work the way you expect.