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How the Link Between Self-Esteem and Pricing Works

24th Mar 2022
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As the saying goes business is personal. And never a truer word has been spoken when it comes to how you set your pricing for your small accounting firm. The rate you set your firm's pricing at is highly linked to your self-esteem. Self-esteem is defined as having confidence in one’s own worth or abilities. It’s about how much you respect and value yourself. This article explores the link between self-esteem and pricing, but also what you can do to boost your own self-esteem in order to start the journey to increase the prices of your small accounting firm.

How is self-esteem related to the level you set your fees at?

When your self-esteem is higher, you feel better about yourself and your firm, but you also have more resilience. Studies have shown that high self-esteem means you are likely to find rejection and failure less painful and easier to bounce back from. (1) As well as more resilience, high self-esteem means you are less likely to be vulnerable to the effects of anxiety. (2) When anxiety kicks in, it becomes much, much harder to charge what you are really worth.

This resilience, which comes from high self-esteem, is vital to the sales process. After all, to charge what you are really worth means that you will become too expensive for some Clients and Prospects. And if you are to achieve the goals you have set for you and your firm, then you will need to get comfortable with some rejection. After all, not every Client will want to pay your new fee level. Not every great Prospect will want to come on board at the fees you are quoting. But at a much simpler level, if your self-esteem is low and you don’t value you or your firm’s abilities, then why should your Clients? Very simply, the fees you quote will be limited by the level of your own self-esteem. 

How to improve your self-esteem?

You may be thinking at this point, that you are going to have to “fake it until you make it”. However, this normally doesn’t work. Most Prospects and Clients can spot contrived confidence. It often comes across as fake and is relatively easy to spot. It also introduces doubt in the mind of the buyer. The very person who you want to be confident in you and your firm’s services. 

It’s not easy to improve your self-esteem. Firstly, low self-esteem is often associated with mental health issues. If you think that you could be suffering from a mental health issue such as depression, then seek medical advice. Sometimes a clinical solution is the right answer to improve your self-esteem. However, in the absence of needing a clinical solution here are some simple ways to nourish your self-esteem when it is low.

Play to your strengths.

Doing stuff that we don’t like or know we are no good at over a prolonged period of time is enough to get anyone down, and doubt their sense of self-worth. One of the great things about being your own boss is the ability to delegate or outsource the tasks which don’t fill you with joy or play to your strengths. For example, if marketing is really not your thing, then give it to someone who is good at it; even if that means outsourcing it to a marketing professional or agency.

Give yourself time to review how far you have come.

It’s very easy as the owner of an accountancy practice, particularly a growing practice, to get stuck in always being busy. Always doing something. Always striving towards the next milestone. As a result, you can often lose sight of exactly what you have achieved and how far you have come. You can feel like you are making no progress and this can bring you down. So, make sure that you give yourself a little bit of time every day, week, month, quarter and year to review you and your firm’s progress. This progress review can help you realise just how good you and your team are. Recently I sat down with a member to help him with his award entry for this year's Accounting Excellence Awards. It was a massive boost to his self-confidence when we realised that with our help and support he had grown his practice from £300k in turnover to £700k in turnover in just 3 years. 

Eliminate people who get you down.  

Everyone is surrounded by people in life who either build them up or, sadly, bring them down. As much as you can do, minimise your interactions with people who act as a drain on your self-esteem. One of the reasons the Daily Power-Up Call which we run for members is so popular is that it is an opportunity to surround yourself with people who 'get' you and can also help you start your day the right way. There is no substitute for talking with real people who get and understand what you are doing. This is why we started the Daily Power-Up Calls. After all, there is only so much comfort, fun and support you can from a Facebook group and a once a month Q&A type of call.

Be kind to yourself.

Everyone is always their worst critic. It’s our old friend the Amygdala at work again. When you find yourself being critical about yourself, turn it around. List out the positive or good things that you did. Or list out your positive qualities. This is particularly good when your self-esteem has recently taken a hammering. Being kind to yourself is much more than writing out a list of your positive qualities or what you have done well. When you are truly kind to yourself you prioritise your self-care. For example, when I am being kind to myself I make sure I have a morning walk before starting the day. This week may only be as short as 10 minutes. But I know it is a great way to look after my mental and physical health.

Work with a coach.

Our personal self-esteem is often chipped away at by our own self-limiting beliefs and stories we tell ourselves. Working with a coach is a great way to help yourself see things for how they really are. Rather than how you are imagining them to be. For example, I've worked with one member for over 5 years now whose comfort zone is to play the martyr. This role was incredibly damaging to his self-esteem. In the last 2 years, with my help, he has started to change the script. Interestingly now the script has changed, his practice has become significantly more profitable and any low-performance issues are dealt with quickly. And yes, his practice is now (finally) doing a decent fee increase to get them back in line with market rates.

Surround yourself with upbeat, positive and successful people.

Frank Sonneburg said “You’re only as good as the company you keep”.

This means very simply if you hang out with other accountants who are upbeat and have good self-esteem, this will start to rub off on you. Maybe it's time for you to change whom in the profession you spend time with? For example, we know our members get an instant boost in their own self-esteem and how they value their firm after joining The Accountants Millionaires’ Club.

Take the first steps to value yourself more

When your self-esteem is low it is hard to start on a project to increase your prices. After all, if you don't value what you or your firm is delivering then why would you increase your prices? Often the journey to increase your self-esteem starts with many tiny steps. For example, how about reviewing your current client list to see who is profitable and who isn't? 

Or how about coming to our workshop with Ignition on the 28th April 2022 in central London to help you have the confidence to charge what your firm is worth? Find out more here. At the time of writing half the places have been filled.

This is what one of our delegates said after attending a recent workshop run by us:

conversation about pricing and taking action

In summary

If your self-esteem is low, i.e. you have a low sense of self-worth, you will price your accounting firm's services low. Investing in yourself and your self-esteem is a necessary step if you need to increase your firm's fees.

 

References

(1) Does low self-esteem enhance social pain? The relationship between trait self-esteem and anterior cingulate cortex activation induced by ostracism. 2010. Onoda K1, Okamoto Y, Nakashima K, Nittono H, Yoshimura S, Yamawaki S, Yamaguchi S, Ura M.

(2) Why do people need self-esteem? Converging evidence that self-esteem serves an anxiety-buffering function. 1992. Greenberg J1, Solomon S, Pyszczynski T, Rosenblatt A, Burling J, Lyon D, Simon L, Pinel E.

 

Replies (6)

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By Paul Crowley
25th Mar 2022 19:36

Good article

Look in the mirror once a day and and tell the person you see that they are worth it

If you do not look forward to getting a call from a client then the relationship is dead. Charge more money as personal compensation or take the plunge and terminate the relationship.

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Replying to Paul Crowley:
Heather Townsend - accountant's coach
By Heather Townsend
28th Mar 2022 10:40

Thank you for taking the time to comment. And completely agree about the need for a positive relationship with your clients.

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By North East Accountant
12th Apr 2022 11:14

Thought provoking indeed as I had never thought about the link between self esteem and pricing before.

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Replying to North East Accountant:
Heather Townsend - accountant's coach
By Heather Townsend
14th Apr 2022 09:14

Thank you for taking the time to respond. And yes, this stuff does make you think.

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By Paul Dunn
13th Apr 2022 03:14

Great one, Heather. Well done you! And we could also have added "STOP charging by the hour NOW — recognize that it's all about the outcomes not the inputs."

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Replying to Paul Dunn:
Heather Townsend - accountant's coach
By Heather Townsend
14th Apr 2022 09:14

Thanks Paul - and yes, definitely stop charging by the hour.

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