How to price during a pandemic
Profit improvement expert Mark Wickersham tells you how to price your practice while supporting your clients through the pandemic.
This pandemic is creating fear.
Not just fear for our health, but fear for our businesses and livelihoods.
And the question we keep hearing is: how should we price our services during a pandemic?
There is so much anxiety over pricing in these tough times. In this article we will explore two key themes:
Can practices use the pandemic as an opportunity to pivot to value pricing?
As so many firms have shown and proven their value over the course of the devastating events of the past year, is there a way to capitalise on that value with a better pricing strategy?
Avoid the big mistake
When our clients are struggling – as so many have over the last 12 months – it’s natural to want to help them. And many firms believe help equates to freezing their fees or even reducing them.
That would be a big mistake.
Firstly, you have to stay in business. If you don’t stay in business, you can’t help your clients! It’s that simple. You have to be commercial. It’s OK to make money; don’t feel guilty. When you have a healthy accounting firm, you have the resources to better help your clients, and to help more businesses.
If you reduce your fees you also reduce your ability to serve, and that’s not in the best interests of your clients.
Secondly, not every business should really be in business. During tough times the entrepreneurial businesses will adapt and pivot. We’ve seen incredible creativity and entrepreneurialism in so many small businesses over the last year.
Others won’t change. Or perhaps their business model is one destined for failure due to changes in technology, fashions and other market forces. The pandemic has simply acted as a catalyst to bring about these changes faster. For example, there has been a gradual change over the last 5 – 10 years of using technology for better communication, collaboration and homeworking; the pandemic has significantly accelerated what has already been a gradual change.
You cannot save every business. It’s the business owners’ job to adapt and change, not yours. Some will, and some won’t.
Remember, not everyone is struggling
Even though times are tough, not everyone will be struggling in the same way.
Some businesses even thrive in these times of crisis.
There is no need to discount your prices for businesses that can still afford your services.
Your clients need you
When times get tough, your clients need you more than ever.
There are things that you can do during this time to add huge value. For example, during the pandemic many business owners needed a lot of help accessing government funding, understanding the latest rules on furlough, making loan applications and getting cashflow forecasts.
This is a great opportunity for you to really help your clients and make a huge difference to their businesses. Your services are even more valuable during these times because the impact you have can mean the difference between a business surviving or not.
It is more important than ever that you price based on value, not time. Value pricing means you set your price based on the value to the client. When you create more value – and you can create so much more value in tough times – then you can (and should) price higher.
Bottom line is…
You should be focusing on helping clients navigate through this crisis, deliver massive value and consequently charge higher prices!
This is a great time for the accounting profession. So many of the firms I work with are reporting that the last 12 months have been their best in business. And they should be.
Your focus should be on how you can best help your clients navigate the crisis. You need to fully communicate the value of what you do. Help the client understand how you will solve their problems and paint a picture of what their business will be like after you have helped them.
If you have found this useful and want to learn more about value pricing, marketing and business strategy, I run a free live training session online every month with a different topic chosen by you. I also take Q&A at the end to answer your burning questions live. Click here to register and I will send you an invitation to the next session.
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Mark Wickersham FCA is a Chartered Accountant and public speaker. He is well known for being an excellent profit improvement expert in the accounting community.
Mark is also a widely published author on practice issues. In May 2011 his first book, “Effective Pricing for Accountants”, was a number 1 Amazon bestseller.
In 2015 Mark...