Pricing Services

Stop inviting clients to shop your offer around. Big branding client. Discovery call. They're excited. Then I show them 3 options. Not one. Three. "Why would you give us choices?" they ask. "Doesn't that complicate things?" Actually, it simplifies everything. Here's what 30 years of running two 7-figure businesses taught me about options: • Option 1: DIY (10% price) Digital course. Templates. Self-paced. For those who aren't ready to invest yet. Infinitely scalable. Zero touch from you. They get value. You get a customer. • Option 2: DWY - Done With You (x price) Finite deliverables. Some customization. You do the work together. Sweet spot for most buyers. • Option 3: DFY - Done For You (10x price) White glove. Bespoke. Custom everything. Training, coaching, custom software if needed. You handle it all. They write the check. The magic isn't in the options. It's in what happens next. When you present one option, they think: "Should I buy this or not?" Binary decision. Easy to say no. When you present three options, they think: "Which one should I buy?" The conversation shifts from IF to WHICH. Psychology 101: People hate missing out more than they love getting a deal. Give them one option? They'll shop around. Give them three? They'll shop your menu. Your 10% option captures future buyers. Your 10x option makes your middle option look reasonable. Your middle option? That's where 80% of sales happen. Price anchoring and why it works. But here's what most people miss: Each option must solve the same problem. Just at different levels of involvement. Not different services. Different depths of the same service. What three options could you offer today? Have you tried options in your offer? What happened? Drop a comment below and share your story. Small Business Builders #pricingstrategy #salesstrategy #businessgrowth

Pricing shouldn’t feel like a fight. It should feel like a fair conversation between adults who both want the relationship to last. When costs keep rising and margins start to feel thin, the worst thing we can do is spring a surprise increase and hope customers accept it. The better path is to make small, evidence-based adjustments that people can understand, and to do it with enough notice that trust grows rather than erodes. Here’s how I guide teams through it... We set a simple rule first: price reviews happen on a predictable cadence, anchored to a sensible index, and capped so there are no surprises. Then we give customers a choice. A clear Good / Better / Best set of tiers lets people pick the value that fits, and it means we stop discounting just to “make it work.” For loyal customers, we start with a grace period and then move in small, scheduled steps. It’s respectful, and it smooths cash flow for everyone. We also swap blanket discounts for an early-pay credit that protects the list price while bringing cash forward. We add a few fair boundaries so small, urgent, or high-touch work is priced to match the effort. Where costs have increased in one part of the service, we re-bundle so value is obvious and buyers are never misled. And when it’s time to talk, we keep the message short and human: here’s what changed in our input costs, here’s the adjustment we’re making, and here’s what stays the same in terms of quality and scope. If you track a few signals for 30 days, you’ll see better results like: most eligible accounts receive the scheduled uplift, the overall discount rate falls, more invoices are paid early, average revenue per customer increases, and churn and NPS hold steady. The goal is pricing that is predictable, and defensible. Think caliper, not hammer, with measured moves that protect margin and maintain customer goodwill. How do you explain price changes to customers without losing trust? ------- ➕ Follow Jonathan Maharaj FCPA for finance‑leadership clarity. 🔄 Share this insight with a decision‑maker. 📰 Get deeper breakdowns in Financial Freedom, my free newsletter: https://lnkd.in/gYHdNYzj 📆 Ready to work together? Book your Clarity Session: https://lnkd.in/gyiqCWV2

Where the alarms should ring is in the health benefits/insurance industry. I just did an interview in which I asserted, something I deeply believe, that these companies for the most part add only administrative costs and hassles to the healthcare industry and provide absolutely no value. Negotiated prices by insurers are often if not invariably higher than cash prices for the same procedures at the same places (see, for instance https://lnkd.in/gKk2UXaZ or do a search under the phrase are healthcare cash prices lower to find more evidence). Prior authorization has expanded in use even though the American Medical Association notes its effects to increase prices, red tape, and burdens on both healthcare providers and patients (https://lnkd.in/g_iAkgRQ). In fact, benefits administrators often deny payment of valid, even pre-authorized healthcare claims, further driving up costs and inefficiencies (see, for instance, https://lnkd.in/gBf66VEz.). Health insurers don't get better prices, don't improve access to care, and don't reliably even pay claims. In short, they add absolutely no value. One reason that the Kaiser health system is able to offer high quality at lower costs is because it is an integrated system that eliminates these third party administrators (https://lnkd.in/gUd9cnBE). Employers, when they use third party administrators, are for the most part NOT getting what they are paying for. They should change their purchasing behavior. #healthcare #KaiserPermanente #medicalcare #healthbenefits #healthcarecosts #healthinsurance #healthinsurers

Stop copying big hotels. It’s killing boutique hotels. Big hotels win with volume. Boutique hotels win with value. Yet too many boutique owners keep chasing “perfect occupancy” like it’s the goal. It’s not. Revenue is the goal. And revenue ≠ occupancy. Here’s the uncomfortable truth: - ADR is your steering wheel. Not room nights. - A slightly lower occupancy with a stronger ADR often beats “full” rooms sold cheap. - Scarcity is part of the boutique product. If everything is always available, you’re training the market to treat you like a commodity. - You don’t benchmark against the 300-room resort. Different engine, different cost structure, different guest expectations, different promise. The boutique move is simple (and disciplined): 1. Pick your guest identity (who you’re not for matters). 2. Price for value and experience, not fear. 3. Control inventory strategically to signal demand and protect rate. 4. Compete with boutiques not with big-box hotels playing another game. If you’re running a boutique hotel and still measuring success by “how full we were”… you’re optimizing the wrong metric. Question: Are you building a boutique brand or operating a small version of a big hotel? #BoutiqueHotel #HotelRevenue #ADR #HotelStrategy #Positioning #HospitalityLeadership #RevenueManagement #BrandStrategy #MELIORTEMPUS

Setting minimum fees aligned with the depth of services the firm actually provides is crucial for all advisory firms. Interesting to see even mega-RIAs resetting minimum fees now. Mercer's new structure: - $1,200 minimum fee for investment-only (up from $800) - $6,000 minimum fee for planning + investments (up from $4,000) - $15,000 minimum fee for top tier including estate/tax specialists (up from $10,000) The firm charges AUM fees; minimums only apply to those who don't have sufficient assets to cover the fee on their AUM schedule, but otherwise want and value the service. (Lets them set a minimum fee to ensure clients can be served cost-effectively, without actually having an ASSET minimum.) Who else is looking at setting/revisiting minimum fees for 2026? Or disagree with the approach? "Mercer raises fee minimums 50% for new clients with low AUM"

The 15-minute energy prices will have a significant impact on the value of flexible production and consumption. This is good for you if you own a battery energy storage system or an Electric vehicle, and will be introduced throughout Europe on October 1st.   The average 15-minute prices might be equal to the 60-minute price, but I expect the price fluctuations within the hour to be of a similar magnitude to those we now see within a day.   The day-ahead market price is set by the marginal price of each period, so, naturally, prices will differ significantly within the hour as the availability of production differs.   Solar power production follows a ramp pattern, with the first 15 minutes having a lower volume than the last 15 minutes of the morning hours. The consumption is much more stable, meaning each morning hour starts with a high price and ends with a low price. Conventional generation cannot ramp up and down in this short time span, so the supply and demand curve will shift, impacting prices.   This is what should happen as the market moves closer to the physical reality with a more accurate pricing of the energy.   These price differences will significantly increase the value of flexibility and energy trading.   ☀️ For PV, it will result in even lower capture rates. 🔋 For a BESS, it means that there are four times more products to trade but probably ten times more spreads to deliver on. This will double the value that can be captured from the day-ahead market.   🚗 It can result in lower charging costs. Instead of charging your car for two hours straight, the optimal charging plan would spread the process over the best 15-minute periods throughout the night. It requires the charging optimiser to pause and restart the charging several times during the night to take advantage of the cheap periods. Optimal planning will increase in value compared to a fixed charging schedule.   Some of the Danish DSOs have been very slow at introducing 15-minute readings for the consumption customers. You may be settled on a 60-minute basis after October. In this case, the DSO will take your hourly consumption and spread it out equally in the 4 periods. In some cases, it might require a new meter, but the regulation states that everyone has the right to be settled at the same resolution as the market time unit. Hybrid Greentech - Energy Storage Intelligence

The question I hear most from founders during Sequoia Capital's Arc program is about #pricing. Pricing is one of the most underutilized levers for startups. Why does it matter so much? It has the most direct impact on revenue, and the moment you establish your pricing, you determine your TAM. Getting the pricing metric right is, by far, the most important one. The key is to imagine the future: when you are a large and successful company, how have you changed the world, and what metric correlates best with your success? Hitch your financial wagon to that metric! If you are Figma, success is all designers using the app; therefore, the pricing metrics is per designer seat. If you are VMware, success is all workloads run in virtual machines; therefore, the right pricing metric would have been a virtual machine. A pricing metric is like the genie in a bottle: once you get it out, it is tough to rein it back or change it. The pricing model is about when and how frequently you charge. Recurrent subscriptions are the predominant model for SaaS apps, and usage-based pricing is the model for infrastructure solutions. Usage-based pricing creates a beautiful alignment of incentives but is less predictable. Upfront credit purchases and commitments are efforts to make usage-based practice more aligned with the rigid corporate budgeting processes. You can be the premium solution or the affordable one. Both are legitimate approaches. But your pricing needs to be consistent with the rest of your strategy: with your product and distribution channels.  You can’t have an affordable solution distributed through an expensive enterprise sales force. In this case, you need to sell either online or through inside sales—the product better be simple and the sales cycle quick. Many technical founders are shy about asking for a lot of money for their product. Don’t be. If customers like the product and it delivers value, they will gladly pay for it. Unless you hear customer complaints that you are expensive, then for sure you are underpricing. Calculate the ROI of your product, and take 20% of that value as your price point. How much it costs you to build the solution should not guide your pricing. But you should do a sanity check that you have a decent gross margin. Most companies start by selling a single package. Over time, they realize that different customer segments have different maturity levels and willingness to pay. To price discriminate between these segments, you need to introduce multiple packages.  Start by creating a customer maturity curve to inform your decisions on how many packages you need. The trick is to have the smallest number of packages to cover the broadest range of customer needs. Your packages will change and evolve quickly as your product matures. 

It was reported that Delta is piloting AI that sets ticket prices not by route, class or segment, but by calculating how much YOU personally are willing to pay. The system, developed by Fetcherr, analyzes your digital footprint, real-time behavior, and inferred urgency to extract maximum value from your specific situation. Note that this isn't dynamic pricing. It's psychological exploitation. Considerations: ➕ It is emotional exploitation preying on your context, like last-minute grief trips, surprise business needs, and family emergencies. The approach targets vulnerability, not value. ➕ It uses invasive surveillance by analyzing browsing history, loyalty data, location patterns, and urgency signals, AI is essentially "hacking your life" to determine your breaking point. ➕ Amplifies inequality, as research has shown AI pricing models often advantage those with higher incomes while penalizing those with fewer options. That's not personalization; it's predatory. ➕ Trust erosion happens when prices are tailored to your financial threshold and fair commerce ceases to exist. While transparent pricing builds trust, we’ve seen opaque algorithms destroy it. ➕ Takes advantage of regulatory gaps even while claiming compliance. AI's reliance on personal data and black-box decision-making exists in a legal gray zone that warrants overdue oversight. However, we’re seeing just the opposite at the Federal level with AI safety rollbacks this year. The conversation at Delta shouldn't be whether AI can optimize pricing for operational efficiency; that's proven. The real question leadership should answer is whether they're willing to cross the line from business optimization to psychological manipulation for profit. #ethicalaimarketing #responsibleai #leadership #businessethics #consumerrights

While competitors sold mattresses at ₹10,000, we launched at ₹29,900. Amazon and Flipkart said it wouldn't work, because our price was 3X what sells on their platforms. Today, The Sleep Company is the fastest-growing mattress brand in India. People ask how we convinced customers to pay a premium for a mattress. The answer isn't about pricing. It's about understanding value. Indian customers are willing to pay ₹1 lakh for an iPhone, and ₹2 lakh for a Royal Enfield. It’s not because they're "affordable”, but because the value is clear. So, the real question isn't "Can they afford it?" It's "Do they believe it's worth it?" Most brands price like this:  Cost + Margin = Price But, we flipped it to Value-Based Pricing:  What's the transformation worth to the customer? = Price Our product wasn't just 3x the price, it also delivered 5x the outcome. And every touchpoint communicated that. But most of the brands end up making these mistakes: 📍Underpricing to "get traction"  📍Overpricing without differentiation  📍Changing prices too often Here’s what worked for us instead: 📌 The sweet spot wasn't the lowest. 📌 Focused on value perception - packaging, unboxing, communication reinforced "premium." 📌 Invested in experience - website, stores, after-sales. Premium pricing demands premium delivery. As a result: 📍₹60,000 became our best-selling price point 📍Customers didn't ask "Why is it so expensive?" They asked, "When's the next collection?" Premium isn't about charging more. It's about being worth more. And if you deliver on that, the market will pay.

In business, there's a huge difference between price and value. If a client starts the conversation by focusing solely on price, chances are they're not going to buy—or worse, they may not be the right client for your business at all. When a customer is only interested in negotiating the lowest price, they often don't appreciate the value you bring to the table. We realized that as soon as we increased our prices, everything changed. Not only did our revenue grow, but more importantly, our client profile shifted dramatically. We began attracting clients who truly valued the quality and expertise we offer. These clients understood the investment they were making and trusted us to deliver results that justified the price. By raising our prices, we set a new standard, and the clients who recognized that were the ones we wanted to work with all along. Remember, when you charge what you’re worth, you attract clients who value what you offer. It’s not just about making a sale—it’s about building relationships with clients who understand the value behind your work.