How to become more efficient by changing your prices
How to motivate yourself to become more productive with one simple change
Efficiency is the key to freedom
@@Efficiency is the key to freedom as a business owner@@
Are you overwhelmed, frustrated with your clients and generally struggling to find that elusive freedom and easy life that everyone convinced you would happen when you owned your own business?
First off... they lied. Being an entrepreneur is hard, no matter how you do it. But it doesn't have to be soul-sucking and time-consuming. Focus on becoming more efficient and it's like being given the keys to a new, relaxing kingdom. Make your processes more efficient (or automate them) and suddenly, you have more time to do the important things, like working with clients.
Your prices affect your efficiency
In any discussion about becoming more efficient, we have to talk about pricing. It comes down to a question of motivation. If you’re pricing your services by the hour, there’s no motivation for you to ever become more efficient. You are incentivized to charge your clients as many hours as you can because that's how you make a living. The slower and less efficient you are, the more money you make.
Change your pricing structure away from hourly billing and you've suddenly changed your priorities. You've created a system where you are now incentivized to be efficient. Now, the more efficient you are, the more profitable you are and the more revenue you can generate.
Stop freedom-jacking yourself
Charging by the hour, your income will always have a maximum cap. There are only so many hours in the day and in the week and in the month and in the year. Sure, you could raise your hourly rate, but at some point, people will stop being willing to pay you more than a certain amount per hour. And that’s your cap.
Becoming more efficient when you’re charging clients hourly just doesn’t work. It will actually reduce your income. Sure, it makes your life better and easier, but @@when you’re worth is tied to your time, you’ll always have a maximum revenue and a minimum amount of time that you have to work.@@
Rethink your pricing strategy
So, what’s the alternative? Flat-rate or project-based pricing. This looks slightly different for each business, but the basic idea is to start charging your client by the VALUE of what you’re delivering, not by how long it takes you to do it. Your value is in your expertise at whatever it is you do. And sure, it takes you a certain amount of time to do it. But your client doesn’t actually care about how long it takes you. They just care about what you’re delivering them and the impact it will have. Charge them based on that impact, and all of a sudden efficiency becomes your best friend.
Because when you charge them a flat fee, based on whatever the value you’re delivering, suddenly your priorities and motivations change. The more efficient you are at delivering your service, the more profitable you become. The faster you can deliver, the higher your average hourly rate goes.
Time suddenly has tangible value, not monetary. And you have a choice. You can decide to use that time to make more money (with client work) or you can choose to use that time to work on other things. Strategizing how to grow or working on a new service or getting training to become better at what you do. And you don’t have to worry about taking time off for those things because they are actually helping you become better at what you do, which means delivering more value to your client, which means you can actually raise the prices of your service because you’re charging based on how much value you’re delivering, not on how much time it takes you.
@@How you price your services can be the difference between being a successful, sustainable business and something that’s going to burn you out & drag you down.@@
Not quite sure how to do this for your business?
That's one of the first things we talk about in an Unwind the Grind strategy session.