Still charging by the hour? Stop!
Are you still trading dollars for hours?
That is, you charge a client by the hour for every hour they hire you?
While this is a common income model for coaches, consultants, trainers and speakers, charging by the hour has limited growth potential, especially if you base most of (if not your entire) business model on generating income this way.
There are only so many hours in the working week and working extremely long hours is unhealthy, both physically and mentally. And charging by the hour typically involves working with clients one-to-one, which again has limited income growth potential.
There IS a way you can increase your income that won’t require you to work ridiculously long hours, and that will allow you to increase the amount of people you work with at the same time.
How?
By creating packages and programs that can be offered either to individuals or groups of people.
Still not convinced?
Here are 3 reasons why you should create packages and programs so that you can experience exponential income growth to a 6-figure (or more) business.
1. Showcase the value and expertise you offer
Ever been in a situation where you’re justifying your hourly rate to a prospect comparing your services to a competitor that has nowhere near your experience or talent? Yet, here you are validating your hourly rate!
It’s important to remember that you don’t get paid for the hour. You get paid for the value you bring to the hour through your experience and expertise.
Unfortunately, charging by the hour will make it extremely difficult for a prospect to focus on value, benefits and outcomes you offer as they often will get fixated on the hourly rate.
Coach’s tip: Instead of charging by the hour, showcase your promise of value by creating packages and programs that include more than just your time. Make sure each of your packages and programs has a powerful results-driven title. And, ensure you include the benefits and outcomes your prospect will gain through investing in you.
2. Harness the one-to-many income model
There are only so many hours in a working week and cramming your schedule full of appointments as the only way to increase your level of income is unwise.
When starting off in business, it’s often a coach’s dream to be so busy with a schedule full of clients. However in my own personal experience (and what I’ve seen with dozens of my clients) they are often significantly under-charging for the amazing services they offer and are stuck at an income level they just can’t break through because there are physically no more hours in the day.
So, looking at the following examples, which would you prefer?
Coach’s Tip: Create packages and programs that involve more than just your time and that you can offer to a group rather than just individually. Other elements can include step-by-step processes, done-for-you templates, worksheets, audios etc. The list is endless and really depends on the services and support you provide your clients. Don’t be afraid to repurpose your material so that you’re not re-creating the wheel with each program and package.
3. Offer high-end packages
Now that you have a number of programs and packages that can be offered to a group of participants, there may be some prospects that just don’t want to work in a group environment.
Should you turn them away? Absolutely not.
Coach’s Tip: Create a few VIP (Very Important People) Programs, which can be offered to individual clients, however at a premium investment level. Working with you one-on-one means that they will get much more access to you, your wisdom and your expertise and therefore should be willing to pay for it.
Having packages and programs that you can offer to either groups or individuals IS crucial if you want to create a 6-figure (or more) income in your business this year.
HAVE YOUR SAY!
So what do you think? Will you be offering packages to clients rather than just the one-to-one hourly coaching sessions? I certainly encourage you to do this, especially if you want to break through to 6-figures or more in your business.
To your success and brilliance!
Annemarie,
This is something I’ve been wrestling with for a long time. We are in fact, in the middle of re-creating some of our services (based on hours) into products and product packages. So, your article couldn’t have been more timely.
You can create a living selling hourly services, but the rush to provide soon loses that exciting,heady rush and leaves you feeling tired and rushed in the last positive sense of the word.
Thanks for the post…
Mallie
Mallie, glad to hear you found the article helpful. And, of course, well done on creating packages and programs. You certainly won’t look back once you launch them!
This is so true Annmarie,
Trading time for dollars is not the way to go. Making a program that involves templates and worksheets that doesn’t involve my physical presence is the direction that I am headed too.
Working long hours to reach financial goals will definitely lead to being unhealthy both physically and mentally.
Totally agree Justin. Fantastic to hear you are heading in the direction of having programs and packages as well. Wonderful!! Then these can sell while you are asleep – now that’s pretty cool!
It certainly will @justin. Best to start off building the foundations that will allow you to work with groups, has repurposable materials AND that doesn’t involve you to work long, exhausting hours is the way. All the very best with your development. I’m taking a group of business owners through that exact process through my 6-Figure Success Blueprint starting this week. Very exciting for them!
The list is endless and really depends on the services and support you provide your clients. I am not really familiar bit I want tolearn more about this..
Hi Arline, there are certainly ways for many businesses who traditionally charge-by-the-hour to increase their income by offering various packages and programs to their clients. This can also become a residual income stream for them if they structure it as an ongoing service offering. Looking for and creating different ways to create different income streams by offerings packages and programs is an exciting and rewarding process for sure!
This is a problem that many of us in the marketing arena wrestle with. You hit the proverbial nail on the head with packages – it’s the only way to create service annuities that unchain you from the hourly commitment madness. I think most clients want to know exactly what their investment will be and if the packages are tailored correctly to their needs everyone benefits.
Thanks for writing about this Annemarie!
Rich
Hi Rich, this is absolutely vital and reminds us of the importance of niching and being totally clear on what your target audience’s goals and outcomes are. Once you are clear on this, you can build various programs and packages that your prospects can consider. And of course what’s key, is ensuring you list the benefits (as well as the features of your packages) your prospect can expect through investing in you.
Great article Annemarie! I got away from charging by the hour too and offered a list of “deliverables” for my clients. I have more flexibility and I’m not over worked and the client is happy because they know exactly what they can expect done at a given time frame. Well done!
Jocelyn
Hi Jocelyn, glad you enjoyed the article! Wonderful to hear that you have also gotten away from ‘charging by the hour’ too. It certainly is liberating and far more profitable!
This has been my experience also Annemarie, I found offering my services by the hour always meant people compared my hourly rate to that of someone they may have employed on a full time basis and neglected to look at the value I could bring. Now I charge a package price for all web work I do and sell my services on the positive benefits it will bring to the client.
I now find I have a more flexible working arrangement, the client doesn’t feel like I’m milking them by adding up unnecessary hours and I’m making a better income.
Wonderful to hear you are now no longer having to justify your prices, but rather can showcase the value and positive benefits you’ll deliver for your client should they invest in you! The three results you have mentioned since offering packages is proof of the importance following this business model. Well done!
That seems to be a very interesting idea. I guess it will really be beneficial for me since I can work with more people who can also recommend me to more potential clients.
Great article and very timely! The part where the customer would know exactly how much they would pay is a great point which I had not thought of before. Not charging by the hour not only is beneficial for the consultant, it would also make it easier for the client to make a decision!
Always try to pay your bills before their due date. If you wait too long, you’ll end up incurring late fees. This will just add more money to your already shrinking budget. The money you spend on late fees could be put to much better use for paying on other things.