My Fees — The One Thing I Won’t Negotiate
When a new client joins me at my law or strategy firm, often one of the first discussions is about fees. That’s understandable.
A client needs to know how much will be spent on expenses and fees. An upfront discussion is great for establishing a fundamental understanding, laying a foundation of trust, and moving forward.
The conversation typically turns to hourly fees for my law or business strategy expertise. (For speaking engagements, the fee is known to be rate-per-product.) Clients ask, “Well, how much per hour and can you adjust that rate?”
Sorry, no, not now.
Early on, in my law firm, before I also had my strategy firm, I would be tempted to negotiate fees. But I have stopped. Why? What can we all learn from this?
It used to be that I needed work and I was somewhat flexible. If a client came in, I would be willing to charge less per hour to have the work. But now that my business is established and I am involved in multiple activities, I know the value of my time.
In fact, I know the highest value-added use of my time is not selling my hours.
When I set my fees, I am very careful. I want to be able to work with clients, and I want people to have access to me. But I must make sure that the rates reflect what the value of that time is — and it is very high because it presents an opportunity cost. It keeps me from being able to do other things, so I’m very strict about my fees. This encourages clients to use other members of my team instead of me, and it keeps me available for other value-added activities.
That’s why I don’t negotiate my fees.
If you are a business owner, you also have a component of selling time. I recommend that you don’t settle or negotiate your fees. Understand what your value-added is and how it fits your overall business structure. That will help you set your fees correctly and stick with them.
Make sure you download our free checklist to assess your business.
Freeimages.com/photographer lourdes mora.
R. Shawn McBride is the Chief Innovation Officer at McBride For Business, LLC. His signature keynote, The 3 Laws of Empowerment, gives audiences an entertaining look at how they can prepare, plan and protect themselves.