My client Sara had a transformation this week. A business partner who refers business said, "We need you to charge more. You're really good but your hourly billing rate is much lower than other firms we partner with." That's great, but what about Sara's other clients?
As an attorney, Sara can't charge different clients different hourly rates. With a lump in her throat, Sara told the next client her new rate. It was a 50% increase over what she would have quoted last week. Sara's new client didn't balk at all.
One of us was really surprised, and it wasn't me.
Sara's thinking is undergoing a BIG transformation. She is moving away from thinking in terms of what HER time is worth and towards what THE CLIENT gains as a result of her work.
If the client is happy to pay more -- and they ARE very happy because of what they are able to do as a result of her work -- Sara should be happy too.
The other thing Sara has going for her is she works very efficiently. Sara gets twice as much done as other attorneys she knows without sacrificing quality.
Sara's next pricing conversation is going to be even better.
Sara's is going to quote her next client a flat fee based on the value to the client. It's a small piece of a critical business operation, so an easy call that getting it right is important. Important, but not so large in the scheme of things to be worth looking for a cheaper attorney. Especially since they trust Sara and she is a strategic thinker who she adds value beyond "the legal work."
Sara expects to earn 4x what she was charging recently -- and the client is unlikely to say anything other than "yes." It is an easy decision for them.
Yes, her old hourly rate was too low. The new fees, expressed as an hourly rate, might become a distracting side conversation. The fees paid / value to the client is important. An hourly rate is an just arbitrary number unconnected to value delivered.
For many professionals, hourly billing is costing you a TON. If you are a fast, efficient worker who brings strategic insights to your clients, the cost to you is MUCH higher.
The challenge is you must transform your thinking to match your client's thinking.
