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Archive for June, 2011

Charging What You Are Worth

Have you ever had the following battle in your head (be careful, this is treacherous territory you are venturing into)?

I’m fresh out of school and just starting my coaching business so people won’t pay as much for my coaching services as they would a more experienced coach.”

OR

“If I can just get them to understand how coaching works, i can justify my prices so they’ll want to hire me.”

If you have ever had these thoughts (and by the way there are many others) then you are not alone.  Many coaches buy into these two myths when it comes to setting up their coaching model and establishing their prices and, as a result, lose hundreds and even thousands of dollars each month.

This article will bust through these myths and equip you with what is necessary to charge what you are worth and what you deserve.

First – stop selling coaching.  If you attempt to sell coaching as a service you will immediately create the resistance within the prospect of, “Is this worth spending my money on?”, and the only battle in front of you is to overcome ALL of the objections the prospect has as to why they shouldn’t spend their money on your services.  Start selling the end results.  Remember those MasterCard commercials when they portrayed two or three examples of how much something cost, and the final example (which by the way was always the end result) was always “…priceless!”?  When you help the prospect paint the picture of the end result they will accomplish in their life as a result of working with you, your services now become “…priceless!”

Second – stop discounting all that practice coaching you did with your peer coaching buddies while in school.  Did you know on average that when a coach finishes their coach training they will have acquired over 350+ hours of coaching?!  That isn’t anything to dismiss, yet when you have the thought of “I’m a new coach so I should charge less”, you are doing exactly that – discounting the time, energy and investment you made in your coach training.  Start owning all the hard work and investment you’ve put into yourself and account for those hundreds of hours you completed during your training.

Third – implement systems and processes so that you are 100% sure that you can and will deliver on what you’ve promised your prospects.  Many coaches attempt to get their clients without having a solid business foundation in place.  What they don’t realize is that when they run their business this way, the often unconscious energy within themselves is, “Oh crap, now what do I do?!” when it comes to servicing their clients.  Nothing wreaks havoc on a coach charging what they are worth than an underlying worry and doubt about making sure their clients are getting what they deserve.  If you do not have systems in place and you are not 100% confident you can deliver for your clients, you will diminish the fees you charge – because you have to; you’re only providing mediocre services to your clients so they should only pay you mediocre prices for what you do.

So how do you establish your prices?

Here are a few pieces of information that will help you formulate your model and your fees:

  1. On average, a successful coach in this industry is charging in the upper $300’s to low $400’s/month for private 2-3 coaching sessions/month.  And $150 – $200/month for group coaching.
  2. The average one-on-one coaching agreement duration is for 6 months. The average group coaching duration is 3 months.
  3. New coaches should charge no less than $350/month for their services (that is my personal opinion and not backed by any research other than the hundreds of coaches I’ve worked with over the years)
  4. Pro-bono and Barter clients should be limited to a set number (1-2 clients/month at most)
  5. “Friends & Family” discount should be limited to a set number (1-2 clients/month at most)

A few Key Points to know you’re on the right path to charging what you are worth:

  1. When you think you’ve set your fee, double that number (now we are getting somewhere); I’m serious!!!  Most coaches, without realizing it, charge only HALF what their services are worth!  Double the number and stand fiercely for the difference coaching makes in this world!
  2. When you think of the dollar amount you’ve set as your monthly fee and you have this slight sensation of vomiting – you’re close.  Then practice saying that fee into the mirror to get used to the number rolling off your tongue.
  3. When you hear a prospect say, “That’s all you charge for your services?” – You’ll know you’re on the right path because what you actually charge ($400/month) is considerably less than “…priceless!”
  4. When you can proudly (even though it scares the crap out of you) stand for the fees you are charging and think, “Damn, I’m getting paid this much to do what I love”, you’ll also know you’re on the right path!

Be fierce when it comes to setting your business model and prices.  You, better than most, know how powerful the impact of coaching is on someone’s life.  Be fierce and be greedy because the business of coaching is changing lives, one person at a time. Demand nothing less than what you deserve. Demand nothing less than what the client deserves. And you both will walk away knowing the world is a better place because of it.

Posted in: Business Operations, Finance Management

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