So what’s it worth?

They can’t do what we can

Having knowledge, an expertise, is to have a highly valued asset. It is up to us to exploit it as well as we can. If we are service providers there are two ways of doing it. Either might be the right way for us, but it is up to us as to how we use our special knowledge.

Processes

The first way to profit from our knowledge is to sell a process. In one of my businesses the equivalent would be completing tax returns with basic accounts as necessary. This satisfies a need. A client would find the process too much or too incomprehensible to do, or at least to meet the deadline.

No one wants to worry about a fine, and at the same time they want their tax return to be correct. If they don’t have that confidence they pay someone else not only to take on the task, but to take away the worry of having a ghastly chore (as they see it) hanging over them. What they are really paying for is relief from stress.

Valuing the product

From the provider’s point of view, it is mainly a process. Hardly any Tax Returns are exactly the same of course, but the process is something the service provider is very used to doing. However, the sale price (our fee) is based on the length and complexity of the process. It is theoretically a process the client can shop around for, so while there has to be a degree of trust, there tends to be a perceived limit to the value. That is a psychological barrier which is hard to overcome for the provider, no matter how many bells and whistles we attach to make the client feel as happy and comfortable as we can. However, there is a value which we can sell in terms of giving the customers the feel-good factor.

Made to measure

Our second method of selling our knowledge is by providing bespoke consultancy. Accountants, solicitors, architects and all sorts of engineers might do this. People have a specific problem, unique to them, and they need a solution. The solution might be worth a great deal to them, whether (depending on the profession) it is the best way to buy another business, the most tax-efficient way to sell their rental properties, the design of the client’s perfect house or how to build a new bridge across the local river.

There is a significant value in any of these which might involve cost-saving or fulfilling dreams, or simply as a practical solution to a difficult problem. Clients will also pay not just for peace of mind, but to save time, and simply to make their lives easier. When we sell on value here, we should pitch the price as to what it is worth to the client; not what it costs us to do at the time, because that is a totally false basis.

Value yourself

Like all providers, I know what my office costs are, but we who have the knowledge did not gain it overnight. We have been on so many courses, we once burned the midnight oil passing our exams, and we pay a lot to keep ourselves up-to-date with all the latest developments. We have worked hard to have that something others do not have, which is our knowledge; not only that actually in our heads, but the knowledge as to how to find out what we don’t know if you ask us right now.

Never under-value your knowledge. Ask yourself what the imparting of knowledge is worth to your client. Remind yourself how hard you have worked to know what you know. Convince your client of the value. They won’t buy what they don’t value and you don’t want to allow them to buy at a price that doesn’t value you enough.

Reward yourself and give your clients real value for money at a price they and you can afford.