The concept of exchanging services for a fee is very old. I wanted to write some thoughts on people paying you for advice.
Some people sell physical products. Some people sell digital products. And there are people who sell services (e.g. knowledge, transformation, amusement, clarity, joy, etc.). I'm sure in the history of the world it was only a matter of time before consultants were offering advice for food. I'm sure that one day someone will dig up the bones and artifacts of the consultants who guided the construction of the Mayan empire.
People have been receiving fees for their advice in some way, shape, or form for centuries.
The fee. I've written about value-based pricing.
Fees have two distinct variables:
- Perceived value for the services offered (that justifies the investment)
- Buyer and seller are honest and will operate with integrity
Here's what most consultants fail to understand:
- Perceived value is the foundation of the investment. Instead of increasing the value, they often reduce the investment.
- They fail to connect their advice to the improved condition of their client. Time and time again I see consultants base their value on deliverables, time, and materials. (I've sold time and materials - it's a low profit business).
- They never build a relationship with the right buyer (they work with people who do not operate in good faith).
Establishing value with the client is key. If the focus of your discussion is on the price and not the value, the client has taken control of the discussion and the client's focus will always be on managing the investment level.
I'll leave you with this:
- develop your philosophy on the investment people make in your offering
- higher investment conveys higer quality for most buyers
- the consultant must anticipate and plan to overcome objections about how "other consultants" have charged and done work in the past
- money left on the table will never be recovered
- you MUST think of your engagement with the client as a partnership - a real, meaningful partnership
Vikrant Duggal Newsletter
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