The value of knowing where to hit
A pricing parable retold
My boiler stopped working in a really cold spell last winter, and I was desperate to get it fixed ASAP!
A few boiler repair people came round but none of them could find the problem, let alone fix it.
As a last resort I asked an old man across the road to take a look. He'd been an engineer in the Royal Navy for his whole life, so I figured he might know something the others didn't.
The old man poked around a bit, nodded a couple of times, asked to borrow my hammer, then gently tapped on the side of the boiler.
Would you believe it? It sprang into life! No more cold showers and frostbitten fingertips. I was so relieved I could have kissed him (but settled for a firm handshake and a thank you).
The next day he popped round. I happily opened the door to him, and saw he was holding an envelope. Inside it was an invoice.
Fair enough, I thought. I would have paid the boiler repair people.
Then I saw the amount.
"Ten thousand pounds?", I gasped. "How do you justify that?".
"Ah", said the old man, a little too smugly for my liking. "It's simple really. It's £10 for me popping over to hit your boiler with a hammer, and £990 for knowing where to hit it."
"I can't pay that!", I exploded. "I could have got a new boiler for £700. Or one of those fancy heat pumps for half what you're suggesting I pay you."
"What's more", I continued, "you could have warned me it cost that much before you did it."
"Oh", he said, his sheepish tone helping me to calm down a bit. "I hadn't thought of any of that".
The moral of the story?
A smart pricing approach is more than just working out what value you think you've created and hitting your client with a big invoice.
If you’re wondering how to price your services in 2023 in a way that increases fees and retainers without losing clients, your best bet is a proper conversation with a pricing expert in your industry.
Which is me.
I ask you a series of questions before our proper conversation - which I call a consultation - so we’re making decisions based on data wherever possible. You can then take my recommendations and do what you like with them: do the work yourself, work with me further, or work with someone else. But whatever you decide to do, you’ll be confident that your actions are based on expert advice.
To book your pricing consultation and set yourself up for a profitable 2023, simply reply to this email and I’ll explain the next steps.
Jon
P.S. People on LinkedIn sometimes ask me if my pricing parables are true.
Now as you’re smart enough to have signed up to my emails, you’re smart enough to know these stories are simply a way of getting an important message across to recruiters.
If you want to read some true pricing successes, head to my LinkedIn profile page and scroll down to read a long list of testimonials from real recruitment leaders who have changed their pricing strategy and reaped the rewards.
To book your pricing consultation and set yourself up for a profitable 2023, simply reply to this email and I’ll explain the next steps.