You’re Worth More Then You Charge For
Recently there has been some debate over pricing, service rates and many other aspects of my business. It’s a tough subject to really get into because there are so many considerations when I think about it. I wanted to share this post because it’s a topic that haunts any business owner. I think this may help some in making the key decision on whether the price increase is worth the risk of losing clients.
I had the confidence to step out of my comfort zone, but then…
When I first started my business, I started with a super low rate, something that back then I knew would give me the edge to market. A whopping $15 per hour. Yes, websites were built under that cost.
It was great back then, I was just starting, and really now looking back, I undervalued what I had to offer. I, just like then, did it all; graphics, websites, identity management, social media. I heard stories of others that were charging up words of $40 per hour. If only I could, but I wasn’t there yet.
As my business grew and grew, I began to start considering a price adjustment, I figured it was time to change, my portfolio was growing, I had more and more clients loving my work, my self-confidence in my work was growing, as well as my skills in different technologies and platforms. It was time.
As I completed one of my newer client’s projects, published the website and handed over all the final material, there was talk about future work later on, once their business got going, they needed promotional materials for tradeshows, all custom branded to them. I was ecstatic. It was then I sat down on my computer and started adjusting costs. Yes, it is my time to increase, I thought to myself, yes, my work is at that point.
I raised my rates to $18 per hour, then went to visit my client to pick up the payment for their previous work. Then notified them of the price increases, I set the increase to happen in a couple months, as to give formal notice and time to digest, they seemed ok with it.
A couple weeks past, and I hadn’t heard anything from them, I knew a show was coming up within the month and reached out to see if they needed a hand with anything, I wanted to get a start so their printer could get everything completed in time. Then I got a response that they didn’t need the help, that they had gone with someone else who was more reasonable.
So, I hit the delete button…
I tried my hardest to recover them, I was growing but still not nearly as much as I’d like, and so every client was like gold. I offered to bring the price back down, heck; I even offered lower, still nothing they were lost. My attitude towards raising my prices completely changed, everything remained the same and I continued to work for what I now felt was what I was worth.
Then it came to me, I would continue my existing clients at their current hourly rate, and new clients start them at my new rate. Man, did this pan out well, I kept my existing clients happy, continued to work with them more and more, new clients started at my new rate. Things seemed to be working out.
But then things started getting out of control…
Managing client invoices is tough, because really, it’s hard enough to keep track of hours, especially with emergency situations. It’s even harder when you are billing multiple rates.
On an average day I can have anywhere from one to five websites logged on and running on my computer at once, so hour loss is possible, just like balancing multiple rates isn’t the best idea. I managed this way for a good year and a bit, but it was always in the back of my mind what I could do to make it easier.
So now I face the past….
A little bit back I told the story about losing one of my first clients, all over increasing my prices. This is something that I have come back to realize may happen. Recently well chatting with a super awesome business coach about what to do to meet my ever growing (sometimes unrealistic) goals I set for myself and my business. I found my best option would be to go through a price increase.
After speaking to them, they reminded me of what I do, what I achieve, and how valuable my time really is. After this chat, I really did think about their words and what they said, I thought about stories that clients have told me, about how they sought out a designer/developer looking to have their project completed and really only ever ended up with a large bill, and a half-completed job.
Looking at my business and what I do, I don’t leave it half done, I don’t ever receive anything extra, I simply work until both myself and the client call it complete. I spend numerous hours researching, developing, strategizing, and 90% of this never comes anywhere near the final invoice. I am and have been told, that I am charging way too little for my skills, my service level and just for being me in general.
So, what’s the whole point of this article? When pricing, increasing prices or simply trying to figure out how not to lose your clients during any of the above, don’t think about the loss, it will happen, in fact, do you really want to work with someone who undervalues what you do, and can’t see that what you offer is something that no one else does?
It is best sometimes to take a step back, and look at the big picture, yes you may lose three, but, if you keep your standards high, quality pristine, there will be six to fill that loss in no time. Keep your loyal clients close, keep your response times low, and most importantly, stand true to the fact that you are worth every cent you charge.
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