What is value pricing? Have you timed every task in your business? Some businesses no longer bill by the hour and instead package and price their various service offerings.
On this episode, Jason Lawhorn of Lawhorn CPA Group Inc explains value pricing and how his business has implemented it.
Founded in 1979, Lawhorn CPA Group leverages on technology and is today associated with a variety of services and brands, including auditing, marketing, and processing of credit cards. They have multiple locations: Knoxville, Tennessee; Jefferson City, Tennessee; Jackson, Wyoming; and the newest addition is Augusta, Georgia.
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Value Pricing – Key points
- Pricing professional services.
- Shifting away from hourly rates removes the risk from clients.
- If the company is efficient and effective, it will make money regardless of the pricing system.
- Value pricing is the point where the firm’s expectation of value and the client’s perception of value meet.
- Clients are free to pick and choose the level of service they need.
- Pricing involves an end to end system, from CRM to scheduling workflow and business analytics.
- When somebody has 8 hours to fill, they’re going to fill it, regardless of whether or not they work all those hours.
- Technology drives the rationale for value pricing.
- For anyone running a service-based business, value pricing can give a competitive edge.
- Build your team. There’s no “I” in “team,” and you need a team.
If you are in the professional service realm, this episode presents a new approach to billing for services. Enjoy.
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