Ergonomics Professionals offer different pricing options depending on several factors, including the type of industry, size of the company, number of employees, and what types of injuries you need to manage. However, one thing you should keep in mind when pricing your services to your clients is to be consistent. If you’ve ever thought to yourself: "There's other competition in my city, so I have to charge the lowest amount to attract paying customers,” then this is the blog post for you. In this post, I’m going to explain why pricing your ergonomic services low doesn’t work.
I understand that sometimes when we're building a relationship with our ideal clients, we may feel the need to offer them a promotion. That’s why in this article, I want to delve into the consistent pricing strategy that we have on our brochure, our website, or in our system. Specifically, I’m going to talk about the very common misconception in the ergonomics industry that our clients will only value what we do with low prices. I totally get it. Sometimes, I feel that way too. It could be that there’s other competition in your city and you feel that you have to give a better deal to attract clients. Maybe there’s only one other person who is already doing ergonomics assessments in your city, and you think that you have to offer lower prices and do more volume than them.
There’s also this misconception that businesses won't invest in ergonomics programs for their staff because it has to do with health and wellness. Therefore, it’s not a priority. This misconception is something related to how we position our brand of ergonomics. And you shouldn’t build relationships with your ideal client off of that messaging.
So below, we're going to be talking about pricing your services for a high-value service that we provide our clients. Find out the 3 reasons why under-billing your competitors is overrated.
The only way for you to make a solid profit while charging less than your competitors is to have an incredible volume (sales) and efficiency. So efficiency means that there’s a faster way for you to figure out where the risk is, whether it's conducting the assessment quicker or doing the report faster. But if your margins are too close, you still have to consider if you're even covering your expenses. Unless, you figured out a way to provide the same service with that other professionals do in your market with fewer resources. Charging less only means one thing: making less money. And if you're just getting started in the industry, then you're probably far less efficient compared to other professionals in your city. This also means that you'll most likely make even less money.
There are instances where offering low prices works, and one of them is Amazon. Amazon used to offer two-day free shipping. They were able to do that because they had this whole system and infrastructure in place for them to execute. They've been doing this for many years. Walmart also has a system set up for them to implement low prices for their products. The thing with Walmart is that they’re able to have really low prices because they have special pricing from vendors, and they make a huge volume. There's actually a common phrase when it comes to selling our services: “You don't want to be the Walmart of your industry.” And I love Walmart, nothing against them. But usually, the people that Walmart attracts may not be our type of clients in the first place. You've probably seen the website before called “People of Walmart”. But if you haven't, check it out.
The examples above are something to think about when we’re pricing our services. As Ergonomics Consultants, what we need is higher margins in order to run a sustainable business. Ergonomics in itself is a profitable business because the only thing that we’re trading is our services, right? We don't need anything specifically for us to do an assessment, especially if it's an office assessment. However, for us, time is money.
The second thing I want to talk about is that money isn't the only factor that our clients consider. Let’s say every Ergonomics Consultant in the world offered the exact same service, showed up on time, determined the root of ergonomic risk impeccably, and provided effective solutions. Only then would the price start to become an issue. And just like any other commodity, people would look at the lowest price to purchase. However, that's not the case with ergonomics. We're not a commodity. There are endless ways to differentiate yourself from the competition. And sometimes, it's as simple as delivering the report that you promised within the timeframe. In most cities, there's a short supply of professionals doing these types of assessments or consultations. If ever there are other competitors in your area, you can do simple customer service techniques to get your ideal clients.
I don't like to design my business around people searching for a deal. You want to design your business based on what people are willing to pay for, which is quality and convenience. Not only are they more profitable to work that way, but they’re also more enjoyable to work for. With ergonomics, building those lasting relationships is key.
Concentrate on building lifetime relationships with your clients rather than being the flavor of the month. Every year, there are a variety of services that we can provide to our clients. And that's really what we want to aim for. I want you to consider that raising your rates might actually bring in more business. There will always be clients out there looking to pay for quality, convenience, and relationship with you.
The last thing I want to talk about is to look at the numbers. You’ll be amazed how a small increase in your rate can lead to more profit. The reason for that is because the numbers that we charge our clients will add up over the whole year. Even a very small increase can almost be unnoticeable to our clients. Imagine the impact of this over the weeks and months of the year. Likely, that increase in rate wouldn’t impact your client’s decision to hire you. Let's say for a simple example, you'll increase your rates by just $5/hour/ That’ll make thousands of dollars for you at the end of the year. If you set your price too low, you’ll gain less profit at the end of the year. Lowering your price to increase sales will only limit your business growth.
When I do ergonomics assessments, I charged clients according to the type of job that I'm doing. So I’ll say that doing an ergonomic assessment report in an office will be this much, but in my other services like managing ergonomic risk in a lab might be this much. Keep in mind that a small increase will lead to thousands of extra dollars per year. It's enticing when you look at the math of this.
What if, instead of dropping your rates, you invest those profits into marketing your services more? By reinvesting that into your business, you'll be able to charge a lot more than you would’ve been otherwise. This means that you're going to be looking at not only having the same profit as last time, but you're also going to get way more customers. In fact, good marketing can make a huge difference between charging $40 an hour with an empty schedule and charging more than $100 per hour with a booked-out schedule three weeks in advance. I know that's a bit of an extreme example, but I’ve seen it countless times over the years.
There you have it. Those are the 3 things that I really want you to consider when pricing your services. It’s really not a race to the bottom. Our clients and prospects don't just look at the price when we’re delivering our services. If they’re looking at just the price, they're probably not going to be our ideal clients in the first place. What we want is to have a relationship with these people for years and years to come.
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