What hourly rate should you charge for your expertise?

Do you charge an hourly rate, !FIRSTNAME!? If you do, this might be like rolling the proverbial grenade at you. But before we do that, have you heard the one about...

The Repair Job with an Added Kicker?

As the story goes, a repairman was called in to fix a washing machine. The lady of the house led him to the laundry, and showed him the faulty machine.

The repairman inspected it for a few moments, stood back, and gave it a solid KICK! To the home owner's astonishment, the machine began to work perfectly again. And without any further comment, he wrote a bill for $120 and handed it to the owner of the home.

At seeing the bill, she was indignant. "How can you charge me $120? You've been here less than two minutes! And all you did was kick the washing machine!"

The repairman replied: "Well, that’s $40 call out fee ... and then there's $80 for knowing where to kick."

Chuckle we may at that little anecdote, but there's actually a key distinction in this story for YOU. It is...

The VALUE of knowing where to kick

Think about it. How many years has it taken you to know ‘where to kick’ to solve problems and achieve results? That knowledge has a 'marketable' value.

Think of the number of times you’ve been confronted with a specific problem or challenge that needed a creative solution. How many mistakes did you make over the years to be able to get that solution?

How many tens or hundreds of thousands of dollars in mistakes, delays, making good and lost productivity has it cost you? Sure now, you can fix the problem and fast. But surely that doesn’t DEVALUE the results you achieve, does it?

Look at the OUTCOMES, not the inputs

Really, it doesn’t matter if you create the solution in a week, an hour or a minute, if your expertise delivers what the client needs, what is that worth to your client?

It’s for that very reason that charging by the hour or day is crazy. Once you and your client have agreed on the value of the result, that should be the basis of your fee.

Of course, that opens up a whole new topic of HOW to ‘position’ yourself ethically yet assertively on the value of your outcomes, and get agreement on the fee up front. But from that point on, there should be no time clock, no accounting for your hours, and no apologies if you come up with the solution while playing golf.

When you begin to focus on the VALUE you bring to the client, you will not only ethically make more money each job (by charging the actual value of your service), you’ll win more jobs. Why? Because while everybody else is probably toting up their hourly rates and … all looking the same ... YOU will be the standout.

So then... what is your hourly rate again?

Chris Newton

P.S. In the past, this topic has created some really valuable discussion.  If you'd like to share your thoughts, please leave a comment.