The results got me thinking about Stephen Covey’s personal improvement book The 7 Habits of Highly Effective People, and in particular habit four: “think win-win”.
For any of us who have an element of fee income, how we feel about the concept of pricing can be very challenging. After all there are various competing forces, for example not wanting to sell ourselves too ‘cheap’ versus the danger of pricing ourselves out of the market.
I do not wish to comment on the morals of whether customers are paying too much or too little. I’d prefer to encourage thinking about the long term outcomes of our pricing, rather than on the short term.
It’s easy to say all deals are ‘win-win’. After all, the customer was happy to sign for the cost of my services and I was happy to provide them, that’s a ‘win-win’ (probably what the Roman ice cream salesman said to himself after he recently sold a British tourist a €64 ice cream.)
The converse is also true however, as I know many advisers who consistently undercharge for their services relative to the market.
My challenge is to think about the long term. The ‘win-win’ should be thought of over the lifetime of your business or career.
So if you’re interested in long term win-win client relationships ask yourself these questions:
• What is the lifetime worth of a customer to my business?
• Do I know what the “market” price is for my services?
• Would I be happy for my family members to pay what I charge?
When you know the answers to these questions you’ll be far better placed to price your services for you to ‘win’ the long game
Peter Welch is intermediary director for MyTouchstone
