How to Price Professional Services Without Competing Only on Price

How to Price Professional Services Without Competing Only on Price

Professional-service pricing is difficult because the product is not completely visible before purchase.

A buyer evaluates:

• expertise;

• relevance;

• confidence;

• reputation;

• methodology;

• risk;

• expected outcome.

This explains why two consultants can charge very different amounts for apparently similar work.

The goal is not to find the “correct hourly rate.”

The goal is to design pricing that supports a sustainable business and remains coherent with the value, complexity and market position of the Service.

Start with your economic floor

Before discussing value, understand your own economics.

Include:

• target income;

• taxes;

• social charges;

• insurance;

• software;

• equipment;

• accounting;