There was a very large parcel delivery company whose entire franking and distribution system just shut down one day, without any prior problem or fault. Bang! Every single machine in the place just ground to a halt. Total silence!
Everyone stood transfixed, staring at the machinery, then each other, then back at the machinery.
One by one it dawned on them. They had no way of getting the thousands upon thousands of letters and parcels out on the road and delivered. This was a catastrophe, and a major one at that.
The Manager discovered the fault emanated from the control room computer. It had malfunctioned.
The I.T. guys couldn\’t fix it. The Manager couldn\’t fix it. The software engineer couldn\’t fix it.
With no other option they knew they had to call in a specialist, or a consultant. In this case, an external engineer.
When he got there they explained what had happened. They told him where they thought the fault was but said that none of them had any idea how to rectify the issue.
The Engineer walked over to the main control panel of the computer server. This was the brain, the nerve center of the entire company. He looked at the system, the process, the components.
He took out a small hammer and hit one of the panels on the mainframe. Deafening noise erupted and the machines kicked back into life and everyone cheered realising their jobs were safe because the company could continue to work.
The Engineer sat down, wrote out his bill and presented it to the manager who, after looking at the paper, raised his eybrows.
\”£5000? For that? I can\’t authorize payment of this, I cant even warrant the price of this to the board without an itemized bill!\”
The engineer took back the bill and on the back of it wrote out an itemization then he handed it back to the Manager.
The Manager read it, smiled, and nodded.
\”I understand.\” He said, \”I can authorize this!\”
On the reverse of the bill the Engineer had written. 1. Hitting the panel with my hammer – £1 2. Knowing what panel to hit with my hammer- £4999.
I have people asking me for quotations for one day, two day or ten day seminars. They ask me how much I charge for a training course. I give them a daily rate which I RARELY discount. Naturally, should a client want me to run a program for 5 days or more then of course I will consider.
What do you charge for your services? Do you feel the need to be \’competitive\’?
\”How much do you charge for a training program?\” I get asked that a lot.
My answer? \”A lot more than it\’s worth!\” (no, not really, just checking you were concentrating!)
My standard answer? \”I have no idea! It depends on the client.\”
Each person or company is different. Each challenge is different. Each personal or company plan is different. Each group is different, be it in requirement or size.
I will tell you one thing though. I am at the top end of the scale. I don\’t charge less that £5000 for a days training for a group of 50 people. And that\’s just a seminar. Add an experiential event into the mix and it goes up.
Do others charge less? You bet. Do I compete with them? You bet I don\’t.
Why would I compete. I am in business not the 100 metres! I know what I am worth. I know what the clients get from it. I know the amount of work involved prior to the event. I know the experience I have and the knowledge I am imparting.
I know I am giving people and companies nuclear missiles of information for firework rocket prices.
Over the years I\’ve spent hundreds of hours explaining to salespeople the difference between Features and Benefits.
A Feature is what something does. A Benefit is what that something does for you.
(You dont buy wellington boots or gloves. You are buying dry feet and warm hands.)
The other differentiator is Price over Value.
The cost of something is irrelevant if you see the value in it. The price is what it costs. The value is what you attach to it by knowing what it will do for you, or how good it will make you look, or how much you need it.
Go into Louis Vuitton. Tell them you want a Filofax. It costs £500. I know, I have one! Ask them for a discount and see what happens.
Never, ever, has anyone got a discount in Louis Vuitton unless it suits Louis Vuitton!
If you sell on price you will get caught up in a bidding war. You will devalue your product and you have no guarantee the potential client will buy from you. The danger is that if you say \”It will cost you £5000\” and the potential client says no, and after some haggling and negotiation you offer it for £3000, one thought will bounce around your potential clients brain like a pinball.
\”What were you going to do with that other £2000 you were gonna squeeze out of me?\” State your price. Thats how much it is! Never compromise and never devalue your self, your company, or your product!
Can I drop my price? Of course I can. Will I drop my price? Of course I won\’t.
I am not in the market to compete. If I drop my price how do I know the \’competition\’ won\’t drop their price further?
Why would I want to be in a competition? We at the Moore Consortium do not see competition. We don\’t recognise it. For us to have competition would mean that others are doing what we do in exactly the same way as we do it. We do what we do and we charge what we charge…Because we\’re worth it 😉
If you go in for a competition are you in it to be a competitor? No! You are in it to win it!
Here\’s a BGO (a Blinding Glimpse of the Obvious) If you Cut your price…. you will never be able to charge that person full price again.
It\’s far better to educate your client in just WHAT they are getting for the price. Value, value, value. Quality, quality, quality. And do it until they think two things.
1. They think they \’must have this\’. 2. They can\’t believe they get all of that for \’only that much\’.
Once they know what they are really paying for, price is not the issue.