30: How To Overcome The Fear of Pricing Your Services For Your Value

Hi Friends! Can I celebrate episode 30 with you for a moment?!  That's 30 weeks of podcasts in your earbuds from me, & I'm so thankful that you take this journey of learning with me every week.

Today's episode is another BTS episode! I'm sharing an actual PRIVATE member podcast episode that I created for my program, Design Success Academy. 

Here's what you will learn in this note-taking, head nodding episode:
Key Points:

• How to deal with the reluctance to discount yourself and the need to recognize the value of your services.
• The significance of setting boundaries and not compromising on pricing.
• Overcoming the fear of hearing "no."
• Embracing discomfort and making incremental progress in pricing confidence.
• The positive aspects of people-pleasing when within agreed boundaries.
• How to overcome the fear of presenting prices and suggests strategies to confidently communicate pricing to clients.
• Can a gatekeeper help you in managing pricing conversations?
• Scope Creep and the importance of a detailed scope of work in the agreement.

Enjoy and I'll see you next week!
xo
John

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Transcript

Would you let your friend, or a family member, or a colleague, if a design friend called you and said, what should I do? Would you tell your son or your daughter to instantly discount themselves? This is a question that you should ask. Would you recommend that to someone else, to say, oh yeah, you should really cut your price in half?

But yes, give them all the same services that you were going to give them. But no, definitely, definitely cut your price in half. No, no, no one would ever give that advice to anyone that they love. And we have to remember in a situation, especially when we are a solo entrepreneur, and perhaps there are no team members around that we have to love ourselves, and then we have to tell ourselves that, and we have to take pride in our own value of what we're giving to the client.

And we have to tell ourselves, stand up for ourselves to not discount ourselves. Hey y'all, you're listening to the designer within episode number 30. I'm John McClane and welcome to the designer within podcast, the business minded podcast created for creative entrepreneurs by a creative entrepreneur.

That's me. I know firsthand the challenges, but also the victories that can come with our careers. And I'm here to sip and spill the tea with you. It's time to dive deep within yourself and redesign your own business and your life from the inside out. Together we will uncover secrets and share valuable insights.

So prepare for a transformative experience, my friend, because it's time to unleash the designer within. Hey everybody, welcome to another episode of the designer within it is big episode three zero. Yay. Congratulations to me and to you. Thank you for being here. I'm so excited to have gotten to episode 30.

Like I said last week, time ticks by so quickly and I'm having a blast doing this with all of you. So today's episode is. Very, very interesting. I got so much feedback, so much positive feedback from all of you from last week's episode, where I basically replayed my thoughts on a coaching call I did with a client.

And so this week, I'm actually going to play you a private coaching call podcast that I do for the members of my community. This is something that I decided to do because it allows me to just turn on the microphone much like I do with you now and just chat away about questions that they're asking and address them in detail and give them all of my thoughts on it.

So they submit their questions to me and then I can answer them in this. format. So this is with my previous group. And then now, of course, I have my Design Success Academy. And by the way, if you're considering joining my Design Success Academy, enrollment is open now. And you can go to DesignSuccessAcademy.

com and find out all of the information there about the enrollment for the new program that will be starting in February. I would love to have you a part of it. I have over 30 designers in the program at the moment who are having Such wonderful results from learning and implementing and changing their pricing and changing their processes and using my agreement.

And it is really just heartwarming for me to see all of the things that are happening within the design success Academy. So I would love to have you a part of that as well. And if you again, want more information, just head over to design success, academy. com. And all of the information is there. So on today's episode, however, as I said, this is a private podcast that I had recorded for a former coaching program that I was working with.

And as I was reading your comments on last week's episode, I thought, let's do another one. Let's really go into more detail about the things that you are all asking me about. And as usual, the number one thing tends to be pricing. And this episode will go into pricing in so much more detail. I am literally pulling the curtain back.

I am showing you all of the things that I feel are important when it comes to pricing, standing your ground, setting your deliverables. We're going to discuss people pleasing. We're going to discuss how you can raise your rates. We're going to discuss possibly having a gatekeeper for your company to act as the person who delivers the message of sales.

Yes, if that's never been something on your mind, perhaps you want to definitely listen to this episode. So we're diving into so much in this episode about pricing and about how to present those services to your client. And as I did record this for a private podcast, you'll probably see that I'm going a little more rogue on some of my conversations.

So it's a little more loose conversation, but it is good information and it is helpful information. I hope for you as well, much like last week's episode. I love coaching my students and I love helping all of you to better your businesses as well. And if anything that I've done in the past and lessons that I've learned and processes that I have implemented or my 26 page design agreement that I use and give to students in my program.

If that helps you to make your business and your life better to where you are functioning and having a successful business, then it's all worth it for me. So enjoy this week's episode. Get those pens and papers out because this is going to be a note taker for sure. And I will see you on the other side.

And this group coaching call is the fear of pricing our services for our value. You guys have heard me preach this before. You've heard me talk about it before. We've had lots of questions about it, and it's just one of those things that you really have to keep chipping away at. with yourself, and you don't need to beat yourself up if you don't make progress right away, or if you make incremental progress.

That's okay. This is not an overnight change where one day you're going to wake up and instantly be able to charge what you want to charge and say things the way you want to say them. But, essentially, you just need to get used to the fact of being uncomfortable. Basically, being comfortable being uncomfortable is the way that I like to say it.

This is something that my coach has taught me over the years. is that the uncomfortableness is the part that we, as human beings, and as business owners, have such a hard time with. So, there is a lot of uncomfortableness when we are trying something new, and when we are pushing ourselves outside of the boundaries of things that we normally would say or do for ourselves.

And, this is my job. My job is to push you outside of those boundaries, and to hopefully, Allow you to see things that maybe you didn't see before and to cause you to think of other things. So if you are slowly making progress and every month or every week or even every quarter you're feeling a little bit better about raising your prices or raising your hourly rate or finally charging a flat fee for a project.

Then that is progress, and I am proud of you, and this is something that, again, is going to be worked upon by you daily, and, and I want you to work on it daily, and work on it in your mind, and just remember that you can always go back and review the courses, of course, that are inside of the Designer Within.

So, welcome again, and let's jump into what I have to say. The first sort of topic that I've extracted from everything was around pricing. A lot of you say that you're people pleasers and I know I'm a people pleaser too and I want you to understand that people pleasing, it's really not a problem. It's only an issue and it's only a problem when you are outside of the boundaries that you have set for yourself.

So if you're outside of the boundaries of whatever you are going to charge for your fees and your services. That's when people pleasing is a problem. If someone is paying you a fee, and that's a good fee, and you're happy with that fee, and you're content with that fee, and you're making that person happy by pleasing them and giving them good service, whatever boundaries you've set, if you allow them to call you at midnight That's the boundaries that you have set.

If you allow them to call you on weekends and you're okay with that, then that's your boundaries. But, if your guardrails, or your boundaries, or your limitations are saying, here is what I'm providing you, and you're staying within those guidelines, and you're not veering outside of that, and your goal is to make that client happy, then that is a good type of people pleasing.

So, people pleasing isn't a bad situation, and I think we add a negative connotation to it because we feel like we're always over giving or over extending ourselves when it comes to people pleasing, quote unquote. But just remember, if you set the guidelines and you are giving your client the service based upon the exchange of fees that they are providing to you, and they are doing their job and they're staying within those guidelines, paying you the fees, then there really is no problem with pleasing that client.

Now, the problem comes when they start asking for things outside of what the agreed upon exchange of goods and services and all the things that you're giving them is. So if they start asking for more things, not following the rules, or trying to get you to do things, uh, add on things, contact them outside of the time frames that you told them that you would.

That is when it is an issue. Then, if you do that, that is your fault for listening to them and sort of bowing down to them at that point. So not all people pleasing is bad. We have a client, for instance, and this client is a tough cookie, let me tell you. They're very good people, but they're a tough cookie.

They have a huge project, they have a lot of money, they know they have a lot of money, and The project is massive, and we've been working on it now for almost two years, I would say. But this client has paid an exorbitant fee. They have paid us the fee that we asked for for our creative services. And they have happily paid the fee for our project fulfillment and they are paying all of the production and all of our procurement services fees.

So I have no resentment for this client whatsoever when it comes to providing them service. I even tell my team, listen, this is an ideal situation. They are paying us top dollar. They are not asking for any sort of discount. They value our services. Yes, they can be a little rough around the edges sometimes.

And yes, there are some times that perhaps we have to go to their job site a little more often because something has occurred, but because they're paying the amount that we have requested them to pay, I have no problem with that. And there's basically a contingency amount built into the pricing that we came up with, so I know that there's a little bit of a buffer in there to cover those sorts of issues.

That makes me feel a little bit better, a lot better actually, about making them happy and quote unquote people pleasing to them. We had another client as well. Their bathroom vanity for their powder room wasn't going to be in on time. And they were having a party. We had to get them something. So, without even asking them or telling them what we were going to do, we said, your bathroom vanity is going to be late.

However, we already have another one coming today. It's going to be installed. You're going to have one for your party. It's not going to be the final one, but it's okay. And that one is yours to keep when you're done. So they were very happy and it wasn't even an ugly vanity. It was totally fine, but it was one that was in stock.

I think we got it at Lowe's or home Depot or somewhere and we grabbed it, put it in. It was perfectly fine for the event that they needed it for. And then they gave it to their son to put into his, I think his apartment, maybe after we were done. So. Those are things where people pleasing situations are great and they are worth it because the client is paying for it and you are being appreciated and you again have no hurt feelings.

You're not gritting your teeth when they're asking for something. But if you continuously let the client go outside of those guidelines, and continuously let the client get more than what they agreed to pay you for, and break the rules, and follow their own set of rules and guidelines, that is where people pleasing is a negative thing.

So I just wanted to mention that, because a lot of you bring up people pleasing when we speak, and I just wanted to say, it is not always a negative situation, and there should not be a negative connotation to people pleasing if The client is paying you for the exchange of fees and services in a way that is equitable for you and that you're happy with and that they are following all the guidelines and you are not outside of the boundaries that you have set.

Just wanted to put that out there. And by the way, You set the boundaries, not the other people, and not the people on the other side of the table. So, your clients are not the ones setting the boundaries. This is up to you to set those boundaries. And you should have those boundaries set well before you even bring your client on.

So there's no negotiations with those. There's no ifs, ands, or buts. There's no concerns about what are you going to provide, where are they going to provide. Your boundaries are set. And I think that's something that a lot of us don't do, is we don't sit down and come up with the deliverables that we're going to bring to clients, which also kind of intermixed with that are the boundaries that we're going to give to clients.

And a lot of us get paralyzed when we are about to present a price point to a client, when we're about to tell a client, a potential client I should say, what the price is going to be for their project, because we're afraid that they're going to say no. So our mind says, oh my gosh, they're going to say no.

We're already putting thoughts into our heads and we're speaking for that client when we should never try to speak for the client until we hear them say no or yes or maybe or ask us questions. That parallelization of the fear of getting a no sometimes causes us not to either present at all. We shy away and we don't even give them the price or we present something less.

We undercut our price because of X, Y, and Z because of what we quote unquote feel that the area is charging or that. Someone else told us we should charge or based upon whatever you read online or what a colleague has told you. None of these are positive ways to present your pricing. You have to be strong in your pricing and you have to be confident in what you are presenting as your price.

And I also want to say this. Some of you mentioned, um, that you've done presentations before with other people that were involved in the project, such as a architect or a builder, and the other project partner has either told you after the meeting or before the meeting, like, oh wow, that was, that was very expensive, I don't think you're, that's more than I've seen, or that's too pricey, most designers don't charge that, or I've seen designers charge 3 a square foot, and you're at 8 or 10 a square foot, and I've had this happen myself, by the way.

So, I just want you to know that whatever voice is in that person's head should not get into your head. That person does not have any leg to stand on to tell you what you should be pricing your business at. Just because they have never been exposed to an organized, qualified, talented, systematic designer like yourself does not give them the right to say, That your price is quote unquote higher than what they have seen on the market.

They do not know at that point, probably your deliverables. They do not know the differences between, you know, whether it's apples into oranges as in a comparison. And that is something that really has always upset me when this question is posed and when it's happened to me as well. And in the beginning, I admit as a young designer, it would sort of take me aback when someone would say, Oh, when a builder for instance, would bring me onto a project and say, wow.

That's, that's pretty expensive, and the designer I used before never, never charged that, and I would feel a little intimidated, and I was, you know, thinking like, oh gosh, maybe I am over, overpriced. But, turns out, the other designer didn't provide all of the services that we were providing. They weren't doing renderings, they weren't doing all the CAD drawings, they weren't doing site visits.

Anyway, there's a comparison that is not healthy, and that is not equal, and that is something that, Most people, if they don't know the details of something will go directly to the price point and that is where they make their judgment. And that is the part that really, really, really annoys me. So don't let someone else on a job site deter you from, a project partner, I should say, deter you from charging what you're worth.

Your price is your price. And I'm going to tell you in a minute sort of my process for coming up with that price and for your value of your services and how to do that. And write that into stone prior to even someone coming to you and trying to negotiate it or restructure your pricing plan. Secondly, ask yourself this.

If you're on a project and you are trying to lower the price and you're, you feel guilty and either the person's not responding or you haven't heard back or someone tells you it's too expensive. One more point for pricing. Sometimes as the business owner, I mentioned the emotional attachment. I mentioned the fact that we get attached to projects or clients, or we don't want to say no, or we want to lower the price, or we want to discount ourselves.

And That is never good. So for those of you who feel that you can't do that, that you can't stand by your pricing, it is okay to have a gatekeeper for your company. Maybe you need someone to act as your gatekeeper to screen people for pricing. So someone calls you and even if there is a friend, you can send someone to a specified person who is not you, not the owner, not the principal designer.

You can send them to a specified person who is neutral. This person is just following the guidelines. This person is following the menu of services that you offer. This person is following the price points for those menu of services. And this person is following the deliverables for those. And the barrier to entry is what it is on those pages.

And that's it. This person is completely neutral. There's no emotion attached to it whatsoever, and then you don't have to worry about that. So if that is you, if you feel that you do need someone to do that, it is okay. Even if it's someone on your team, even if it's another designer, if there's someone on your team with the personality of a bulldog who is unbreakable.

And who, who can stand by what they say, even if it's a designer or a CAD person or administrative assistant, let them do it. Let them be the gatekeeper for the pricing. They can be the person who starts the process of conversation. It doesn't matter about the discovery call. You could still do the discovery call and then just hand off the pricing portion.

To this other person, or I even know some people who will outsource this. They will outsource this to a trusted person who is a salesperson. And remember, it's just a phone call. They're not going to need to meet with this person in person, but it's going to be a phone call or a video call. So you can find someone who is really, really good at sales, who understands the importance of standing by the pricing and the deliverables, and who definitely needs to have an understanding of your services and what you do as a designer.

Which you can train them on, but perhaps they are paid either hourly, or maybe you give them a small commission based upon if the sale closes, things like that. If you're not good at that portion of sales, it's okay. If you're a great designer, it's hard to do everything, especially when you're a small business owner, and it's okay to outsource that.

to other people and find other people to do those things that maybe we're all not so good at. Fortunately for me, my first career was sales, so it's kind of part of who I am. And I'm sure a lot of you are learning as you go along that what we do in design, a lot of it is sales anyway, whether we're selling a product, whether we're trying to sell a contract to a client.

Whether we're trying to convince them to purchase something, it's sales, sales, sales all day long. But you can outsource that or use someone on your team to sort of be the person who gives that information. And you can simplify this process very easily. Use my designer calculator. I spent so much time making that calculator.

I hope you guys are using it. It is really, really helpful if you do spend the time to set it up. It is done once and done and over. And then that person, especially if it's a designer on your team who is doing this conversation, who is having this conversation, that person can go in and fill in all the information for that for the full service design and then come up with the price point for that for your services.

Now, if it is an outside salesperson and perhaps they don't have that skill set. Go ahead and do that part for them, and then give them the price point on the full service design. But on the other ones, where it is a range of pricing, or if it is a conversation where it is just a general price point that you're needing to discuss, it is okay to have that conversation held by someone else.

But I want you to remember that if you have a hard time delivering that price point, if you have a project and the pricing is 75, 000, you should be able to give that price to your client without blinking an eye, without doubting yourself when you say that to them, because they will pick up on any sort of doubt that's in your eye.

And that confidence is something that will seal the deal and allow you to get that client to move forward to signing the agreement. So, if that is not your strong point, find someone on your team or outsource that to someone who can do that. And then, you can even play dumb, like, Oh, you know what? They don't let me handle the money in the company.

All I do is the design. I'm gonna let you talk to Joe. Joe is so good at this. He is great at relaying our menu of services. He will talk to you about all of that. I can tell you what we do, and I can do the design, but Joe is gonna be able to give you the pricing. They don't even let me touch it. You know, kind of have fun with it.

And, and play around with it. Just remember, you don't have to be great at everything. If you're not good at the pricing, or if pricing scares you, I would like for you to try to work on it, to get over that. But, if you're not, it's okay to have a gatekeeper who can handle that for you. Lastly, Scope Creep, did have a question about Scope Creeps, and people were needing a little Scope Creep refresher.

Scope Creep It's not a bad thing if you have yourself covered in your agreement. So be sure that your original scope of work in your agreement, number one, that it's in there, you have to list your scope of work. You have to be detailed. If you're doing accessories, list out that you're doing accessories.

If you're not, Don't list it. If you are changing the light fixture in the powder room, put it down. If you're not, then don't do it. So whatever is on that scope of work, divided by room, remember, divided by space, that is sort of the bible, the directory, the list, the main set of deliverables for your project.

And anything outside of that, as the agreement says, if you guys are using my agreement, Anything outside of that will be billed at the hourly rate. So be sure that your original scope of work is extremely detailed, that the client signs off on it before you put it into the agreement, and then of course that it becomes part of the agreement, and that there is no vagueness, there is no concern, there is no issue about what you are bringing to the client, but that your scope of work is listed inside of your agreement.

Then you legally have something to stand on when the client comes back and says, Oh, you said you were going to provide this. No, no, no. Here's what I said. This will be an extra hourly charge. And speaking of the hourly charge, make sure that you have in your agreement what that hourly fee will be. Again, if you're using mine, there's a spot for that in there.

Over communicate with your client. So let them know that, hey, you're moving outside of the scope of work. This is a little bit extra. I love it. You can be like excited about it. Oh my God, I love the idea of doing this nursery. I've always wanted to do a nursery for a little boy and this is so exciting. I can't wait.

I will get you a creative fee tomorrow and then you can decide. What you want to do and how you want to move forward. But I would love, love, love to add this on to your current agreement. Say it like that. So just assume that they know. Have that sort of assumptiveness of it. And let them know that you will get back with them with a price point for it.

But be excited about it. Happy that they're willing to give you more money. Then if they say, Oh, no, I thought we could just do this for that price, then you can come back and say, Actually, no, our scope of work is part of our agreement. This would require a new agreement. It's as simple as that. It's very, very simple.

But you need to let them know when they start veering out of that original scope of work before you start doing things. And if you add on one thing, they're going to try to keep adding on other things. Can you choose the front door color for my house? I know we didn't talk about it, but I really want to.

And then it's the shutters. And then it's the exterior stone. And then it's the That's the pavers for the driveway. So just be careful of that. And if it does start to snowball out of control, something that takes you longer than five or 10 minutes, then I would not keep doing it. And I would consider adding on, or I would definitely add on, I should say, an addendum to the agreement or an entirely new agreement.

But be straightforward and honest with your client. Don't be afraid to tell them that this is an addition. Don't be afraid to tell them that this is outside of the scope of work. Chances are they already know it because you've hammered that home. They actually signed off on the scope of work before you did the agreement.

And then they signed off on the agreement, which had the scope of work in it. Chances are they know it. They're just trying to slide it in there, but it's your time. And. Would you not rather charge your time? That is time that you're taking away from your family. That's time you could be relaxing, watching a movie, cooking dinner.

So your time is very valuable. Don't just be giving that away to anybody. And as I said, be excited about it if it's something that's fun, and if it's something that will bring more business to you, be excited. Don't look at all scope creep and all additional work as negative. It can be fun and interesting if you are getting paid for it.

Remember that. It's always good. Stand your ground. You guys are worth it. You're fabulous people. You're fabulous designers. You give so much to your clients. Please make sure that you charge accordingly for all that you give to your clients and find the right part of your value ladder to put them in. And there you go.

That was the private member podcast that I had sent out to all of the members in my program. So again, I really do want to share this information with you because I want to help you. I want to give you little nuggets of applicable things. And I feel that hopefully in today's episode, you were able to grab those nuggets and apply them to certain parts of your business.

So thank you for being with me today. Again, if you're interested in joining my design success academy, Enrollment is open now and we only open a limited time per year and now is that time. So if you're interested, head over to DesignSuccessAcademy. com. I would love to give you more information about what I offer in the program.

It is so detailed. There are courses on everything from your systems and processes to my actual design agreement to how to come up with your pricing. Everything that I bring to my business is in there that helps make me successful, and I hope it will make you successful as well. Thank you for joining me today on another episode of the Designer Within.

It's been my pleasure to be with you today, and I will see you next week on another great episode. See you soon. Thanks for sticking with me to the end of the Designer Within podcast. It means the world to me. If you're ready to dive deeper into the topics that we've discussed here, be sure to check out my online coaching and courses program, DesignSuccessAcademy.

com. Here I will teach you everything you need to know to run your interior design business from starting the project all the way to the end, including marketing and pricing your services for profit. And for more information on this podcast, including how to be a guest or my design services in general, go to JohnMcClain.

co. That's johnmcclain. co. See you soon, friend.