A few months ago, before I started taking custom mobile app projects, I spent some time planning the business that I was about to start. I realized that I had an opportunity to run the new business so that it would be profitable, efficient, sustainable, and most importantly, a lot of fun.
In the future, I'll write about the ideas and resources that I explored. But today I want to talk briefly about one aspect of my new business that I think is particularly interesting, and that's value pricing.
A Little Background
I first learned about the concept of value pricing in 2009. I was attending the annual FileMaker Developer Conference, and sat in on a panel discussion about estimating and billing. One of the panelists, Jonathan Stark, spoke passionately about value pricing and how it had dramatically changed his business.
Ironically, my friend Kirk Bowman (of MightyData) was also a panelist. He was so intrigued by the value pricing concept that he spent the next three months learning about concept. He then started to use value pricing in his business. The result: a 56% increase in revenue in year one, and a 79% increase in year two.
Kirk was so impressed by the impact that value pricing had on his business that he started the Art of Value, a coaching and consulting services company. He also speaks about the topic, and hosts a very popular value pricing podcast.
Skeptical, But Open Minded
I, however, was skeptical. I tried value pricing on a few projects, and had mixed results. When value pricing worked, it worked very well. But when it didn't, it was a disaster. In October of 2014, I appeared on Kirk's podcast and spoke about my experiences with and reservations about value pricing. It's interesting to listen to that episode now, because so much has changed.
When planning my new business, I thought about how I would handle estimates, billing, and so on. I reflected on my experiences with value pricing, and how, even though it hadn't worked out like I thought it would, I was still open minded about it. I wondered why value pricing seemed to work so well for others, but not for me. I soon realized that I had only given it a half-hearted try.
Going "All In" This Time
I also realized that I had the perfect opportunity to give value pricing another try - and to go "all in" this time. The results have been amazing. I recently recorded another podcast with Kirk about these new experiences.
After recording the new podcast, I wrote to Kirk:
"What has surprised me the most about adopting value pricing is that it does much more than simply change how you price your work. Instead, value pricing has a ripple effect that has a positive impact on your entire business. It changes your relationships with clients, and in my case it has even changed how I view my work. It has given me an opportunity to get back to doing the type of work that I love to do, for clients that I enjoy doing it for, and it lets me do it in ways that I feel good about."
An Opportunity to Learn More
If you're interested in value pricing, then here's a great opportunity to learn more about it.
On November 19th, Kirk is giving a webinar on the topic. He'll show you how "to change your perspective to what really matters. We will walk through four steps to double, triple or even 10x your income."