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A recent discussion among a group of professional and talented women I know reminded me once again about how important it is that we not sell ourselves short. The conversation centered around how one of the members should price her consulting services. Numbers flew around and the range between the highest and lowest suggested hourly rate was several hundred dollars. How's that for a reflection of how different women perceive the value of what they offer! Since I also grapple with pricing strategies for my own business it really hit home how important it is to truly ask for and receive appropriate compensation fot the overall value of what you offer. If you don't, you'll find yourself struggling or out of business and then no one is served. As women, it is time to stop putting ourselves on the sales rack.
Last year when I read Suze Orman's book "Women and Money", I wrote a blog post called "Don't Put Yourself on Sale". In the book Suze explains that the reason so many women struggle with money is because they put themselves on sale. Some of these ways include:
- Not negotiating for a better salary
- Reducing our rates for customers that say they can’t afford the products/services we offer as business owners
- Bartering even when we would prefer the cash and/or don’t want the service we are bartering for (or worse yet, bartering in unequal shares - hour for hour even if our hourly rates are different)
- Giving our products or services away because potential customers balk at the price or say they can’t afford what we offer
- Not asking for a raise when we deserve one
- Volunteering our time and expertise when we can’t really afford to be doing so (volunteering itself can be great and rewarding, but if we do so at a detriment to ourselves financially or otherwise, it is not helping anyone!)
It is no surprise with a list like this that unequal pay between men and women rages on. While we certainly can't control economic forces or every financial thing that happens to us, we can control our mindset. It's time we got more comfortable in our own skin and took a stand for what we're worth.
If you own your own business YOU are in charge of your pricing strategy. Sure you need to get a sense of what the market rate is for the products and services you offer, but don't let that limit you. After all, Starbucks wasn't the least bit deterred by a $.50 cup of coffee from the diner down the road. Instead it added additional value (real or perceived) and quadrupled (or more) the price people were willing to pay for their morning cup of java. The stories women tell themselves as business owners as to why they can't ask for THAT MUCH when pricing something are endless. Some of that thinking comes from society and conditioning. A bigger part of that comes from what we think about ourselves. I work with women on shifting that mindset from the inside out when I offer business coaching. I am intimately familiar with the stories we tell ourselves.
Self-employment expert Karyn Greenstreet offers these excellent suggestions on How to Raise Your Fees:
Don’t let fear and limiting beliefs stop you from raising your fees. If you hear yourself making excuses that you don’t know are true, it’s probably your fears and limiting beliefs raising their ugly head. Some of these include, "All my customers will leave if I raise my rates," or "I’m not worth the new rate."
Have a clear idea of where your break-even point is, profit wise. No matter how tempting, you cannot make a loss on a sale. In fact, it’s not just about what you "need" to make, it should be about what you "want" to make, too.
I personally have a mix between work I perform that carries and hourly rate and that which is a package fee. Both my hourly rate and my packages are built with the idea of pricing for the total value someone receives from what I offer coupled with the results they will realize. In "Hourly Thinking Is a Recipe for Disaster" John Jantsch expands on the work of value based fee setting by Alan Weiss. What interested me most is that as I was searching for articles on value based pricing to share, I had a real hard time finding women writing
