How do you raise your prices? Make your clients more money than you cost.
I'm currently in the market for an accountant. Based on a referral from a friend, I got on the phone with Daniel and had a nice little conversation about everyone's favorite topic: taxes.
I was highly impressed. I'm hiring him to do my taxes this year and next. Why was I sold on Daniel's accounting services?
I can tell that Daniel will take care of me as his client. After I emailed him, he got on a short call with me at no cost. We talked through my situation. He answered a few important questions I've had about taxes. All before making any sort of sale.
He provided value upfront, demonstrating his expertise and building confidence and authority. I now trust that he knows what he's talking about.
I'm at a point in my business where I'd rather throw money at the problem of "how do I optimize my taxes" and make it go away. Hiring Daniel will do just that. I don't have to hold his hand - he lets me know what documents I need to send him and that's that. I don't have to babysit him or worry that he'll do a bad job because I know he's successfully done the taxes of a number of other people, some of whom I know personally.
And now for the most important reason of all!
At the end of the call, it was time for the pitch. I was ready. I knew I wanted to hire him. What was the price? $900 a year for my 2019 taxes.
Is $900 a lot of money? Sure it is. But, due to the minutia of how taxes can be structured as a freelancer/business owner compared to how I was doing them before, Daniel declared in the middle of our conversation that by hiring him at $900 a year, he can save me at least $4000 on my 2019 taxes.
I throw $900 into the Daniel machine and $4000 comes out.
For me as a business owner, this $900 isn't a cost, like buying a large Lego set or a new sportscar or a ten gallon drum of bathroom cleaning solution would be. It's an investment, and any investment that gives me a 4x return is literally printing me money and a no-brainer decision. Not to mention I also get access to Daniel at any time to ask tax questions for the whole year as I have them.
Daniel gets paid a solid price, and I am very happy to pay it.
When structuring your own freelance business, a major mindset shift to make is to see your own services in terms of investments your client is making rather than just straight up costs. As I wrote in Why Do You Think I Hired You?, many freelancers seem to view the work they do as just something clients are doing for the fun of it, and money is somehow owed them by the universe. This is a counter-productive mindset.
Your clients are buying your services because they expect to receive more value from what you are offering than what they are paying you.
If you are having trouble closing a deal, or people are balking at your prices, maybe the value isn't clear. Maybe you aren't actually a positive return on investment.
It's also just more fun this way. When you create value for your client, everyone wins. You get something of value (money), they also get something of value (the service you are offering to improve their business). Daniel even said to me, "Making sure that we are a good investment let's me sleep well at night!" Indeed, any sort of "I'm taking advantage of the client" feelings go away and sales are much easier because your client's best interest truly is your goal.
Can you set up your freelancing so that clients are literally wasting money by not hiring you?
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