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Confidently Answer the “What’s Your Hourly Rate” Question

What’s Your Hourly Rate

Do you frequently get asked “What’s your hourly rate?”
When you compete on price, you quickly answer with your prices. If your rate falls within their expectations, you talk further. If your pricing is outside of them, then they move on.

Not all accounting professionals offer an hourly rate. If you separate your fees from time, then what do you say?

Culturally, we’ve been trained to quickly ask about pricing. In reality, it’s a hollow question which doesn’t offer any valuable, relevant information.

Responding to the dreaded pricing question too soon dismisses critical details. Blurt out your rate and you’re instantly judged. Making an important investment solely based on price is like buying a car without checking under the hood.

The Goldilocks Effect

Your rates are too low. Quoting a low rate for your accounting services often backfires. Low prices set off an alarm, causing some people to immediately disqualify you. They believe a low rate reflects the quality of your work.

One client shared his expectations regarding my pricing. He said, “If you had low rates, I never would have worked with you.”

You’re more expensive than I expected. Are you ready to stand by your rates, own your worth and not take it personally?

High rates mean your pricing will be outside of most people’s budgets. They refuse to pay high fees. So they move on, searching for someone else with lower prices.

An alternative does exist. Package your services with options ranging from do it yourself guidance to done for you involvement. This pricing strategy acknowledges the various clients you serve.

The right price. Did it ever occur to you that even when a client accepts your rate, you probably undersold yourself by a considerable margin? A client who runs a million dollar business proudly stated, “Every consult turns into a new client.” This proves her rates are too low. We then rolled up our sleeves to re-figure her pricing.

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Your Hourly Rate is Unfair

Your hourly rate isn’t fair for you or for your client. Even if you share your fees when asked what’s your hourly rate, they’re still in the dark about a total cost. If you’re a fast worker with a high hourly rate, your final bill can be half as much as the person who works slow but quotes a lower rate.
Renting your time overlooks the value of knowing how to solve your client’s problem. It is like hiring someone based on their accent instead of their expertise.

A direct answer to the hourly-rate question boxes you in. Let’s solve that right now.

1. Ideal Response. Decide how you want to answer the dreaded hourly-rate question.

Consider these answers…

  • “Let’s first talk about what you need.”
  • “I offer a complimentary consultation first to find out exactly what you need.
With these responses, the person who inquired about your pricing starts to describe what’s going on with her financials in detail. Go ahead and gently interrupt her. Let her know the first step is to schedule a consult to talk further. Schedule your consult and share the necessary details.
2. The Consultation. Ask great questions during the consultation.

Key questions to ask:

  • What does she want to achieve?
  • Where are things now?
  • What are the obstacles and bottlenecks?
  • What’s possible once the problem’s fixed?
Remember to listen carefully to their answers. Find out about their frustrations and bottlenecks. Assess the problem and the people. Can you solve the problem? Is this someone you want to work with?

If she’s primarily seeking free or low cost solutions, let her go.

3. Solution. After she answers your questions, share your solution. Don’t overwhelm her with too much detail. Instead, give her an overview.

4. Options. Now you have enough information to discuss the various options and prices. Avoid the common mistake of offering only one solution. Present options with various price points.

As you discuss the packages, highlight the benefits and outcome. It’s more important than the nitty-gritty, tactical steps.

FREE RESOURCE

How to Double Your Income While Working Half the Time!

What If They Keep Pushing

If the client keeps insisting that you give an hourly rate, you can respond along these lines:

“I don’t have an hourly rate since I focus on results. I’ll only discuss the price if I know I can solve this for you.”

If she continues to press you for your rate, she’s probably price sensitive. Don’t cave into
the pressure. Decide to let her move on.

Separate Fees from Time

An hourly rate quote differs from a final cost. Instead of highlighting your expertise, potential clients make a snap judgment based upon your pricing.

Confidently answer the question with an invitation for a consult to talk further. During the initial consult, take the time to clarify her needs. Next, decide whether you want to work with this person. If so, then discuss the various packages you offer

Choose to separate your fees from time. Value based pricing is a paradigm shift where you no longer compete on price. Instead you confidently emphasize your expertise and the value your client receives.

Are you tired of doing work for free because you don’t know how to charge for it? Discover how to increase your revenues and attract clients who happily pay your fees.

Earn more and lighten your workload