Ever wonder why some consultants can bill out their time at $10k/day while others struggle to get to $1k?
On the surface, one might assume that the difference is experience, reputation, or industry. And while a particular track record of success helps charge a premium, I’ve found that – beyond a point – it plays less of a role than you’d think.
Instead, I’ve found that how you (and your client) think about what your client is buying is the most significant factor in determining your pay.
If you’re in the services business, you’re ultimately selling one of three things:
- Time
This is a payment-for-service-rendered situation. Customers want a half-day workshop, you deliver it, and they pay you for your time. Fairly transactional in a crowded market.
- “Secret Sauce”
They’re buying your specific model or approach. You’re still selling a half-day workshop, but they’re likely paying a premium because they want something that you uniquely have to offer.
- Impact
They want a specific outcome and believe you can help them achieve it. The “half-day workshop” isn’t the point; the expected outcome is. In fact, if you could give them the same outcome and skip the workshop, they’d likely prefer that even if you charged them double.
Here’s how we tend to think about this:
Selling Time → “Secret Sauce” → Impact
Focus is on You (your time) You (your model) Them (their outcome)
Revenue Potential $ (commodity) $$ (expense) $$$$ (investment)
Limitations Your time Their budget Their goals
There are two key distinctions as you move from left to right on this model:
Where the focus lies
Simply put, is the focus on you – your time, your secret sauce, or on them – their goals, fears, and desired outcomes?
Before you say “them! Always them!”, ask yourself – is it really? Look at your proposal language & structure – how many words are about them vs you? What about your sales calls – how much time are they talking vs you? Are your programs designed around content delivery or outcome getting? Does your website focus on their pains or your solution? You get the idea.
The limitations on the scope of engagement
This is the big idea: Ultimately, a client’s willingness to invest in your services is limited by something.
For most consultants, the scope of engagement will be limited by logistics (your availability or their budget). You can certainly charge a premium for a well-defined “secret sauce” that only you can deliver, but your program will still be constrained by a predefined training budget.
If you are firmly entrenched in your client’s mind as a vehicle for achieving their goals – and their goals have a financial gain associated with them – you unlock a completely different revenue potential. Like our friend Jayson did.
The exception to all of this is celebrity. Simon Sinek gets paid whatever he wants to charge, mainly because he’s Simon Sinek. So, delivering a hit TED Talk, writing an international bestseller, and building an audience of millions of followers is another way to increase your rates… but then again, there are a whole lot more Jaysons out there than Simons.
So, dig a little deeper and ask yourself:
What are you selling?
What do you want to be selling?
What’s one thing you could do this week to start to close the gap?
Download the free Proposal Conversion Amplifier Workbook for a practical, step by step guide on how to craft training proposals that convert.
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