If You Want to Implement Value Pricing, Put Someone in Charge of It
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Source: Partner Advantage Advisory Ron Baker, author of Professional’s Guide to Value Pricing, Sixth Edition ( Customers-----Value-----Price-----Cost-----Product This value chain puts value above cost. Your clients don’t care about how much time you spent on the engagement, only about the value to them. They want to pay less than that value. Costs don’t determine prices, but prices determine costs. If you can’t produce it at a cost that will earn a profit based on its value, then perhaps you should refuse the engagement. Accountants who are loyal to chargeable hours should not be setting the prices. Instead the firm should establish a position known as chief value officer, CVO, whose role is to determine the value of the services the firm provides as a basis for determining prices. From Partner Advantage Advisory, July 2005, p. 2. For the complete article click here. Hudson Sawyer Professional Services Marketing Inc. www.hudsonsawyer.com. Subscription $279 per year; single issues—$25. Orders |