Setting prices can be tricky. You have to ensure you make enough to cover the times you're not making any money because you're not on a project. You also need a pricing model that makes sense, whether it's fee-for-service or project-based. The pricing model should be consistent across clients, comparable to competitive offerings, and have flexibility to offer discounts and promotions.
- Setting prices is tricky.…You have to ensure you make enough money…when you're delivering services…to cover the times you're not making any money…because you're selling…or you're doing administrative work…and you're not on a project.…Your pricing model must make sense,…whether it's project-based or fee for service.…The model should be consistent across clients,…comparable to competitive offerings,…and have flexibility to offer discounts or promotions.…
With a fee for service model,…that's where you're getting paid on an hourly…or daily basis.…This is a good model if you're not sure…how long a project is going to take.…If scope grows, so does revenue.…The downside is, you're at fixed rate.…You can only bill for eight hours a day.…A lot of people come to me and ask,…how do I set my hourly rate?…I learned a great formula a long time ago.…Somebody told me when I was in corporate…that I should take my total cash compensation,…so it was my salary plus my bonus,…multiply that number by three,…then divide that number by 250,…
Author
Mike Figliuolo
Released
1/24/2018LinkedIn Learning (Lynda.com) is a PMI Registered Education Provider. This course qualifies for professional development units (PDUs). To view the activity and PDU details for this course, click here.
The PMI Registered Education Provider logo is a registered mark of the Project Management Institute, Inc.
- Identify types of consulting business models.
- Describe revenue models.
- Explain how to estimate and manage costs.
- Price services using pricing strategies.
- Explain how to negotiate deals with clients.
- List effects of responding to RFPs.
- Identify the phases of constructing a consulting engagement.
- Present findings and implement recommendations.
- Describe different ways to manage legal issues.
Skill Level Beginner
Duration
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Welcome1m 11s
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Using this course1m 18s
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1. Define Your Consulting Business
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Determine the work you do3m 37s
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Manage your cost structure2m 39s
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Build your organization2m 18s
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2. Marketing and Selling
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Market your services2m 30s
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Manage marketing platforms2m 35s
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Sell your services2m 17s
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Expand client relationships2m 45s
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3. Contract and Protect Yourself
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Price your services5m 24s
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Using pricing strategies4m 14s
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Negotiate the deal4m 30s
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Respond to RFPs2m 59s
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4. Run the Consulting Engagement
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Form the team2m 17s
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Manage clients1m 50s
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Present the findings2m 53s
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Implement recommendations2m 16s
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5. Handle Administration
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Manage team legal issues2m 17s
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Conduct financial activities2m 47s
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Manage taxes2m 35s
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Manage employee issues2m 16s
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Insure your business2m 26s
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Get licensed and certified2m 15s
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Get support2m 20s
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Conclusion
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Avoid pitfalls2m 59s
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Next steps1m 18s
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Video: Price your services