Re: Value-based pricing strategies

Hello Mark,

Anything goes when pricing based on value.

The final $ value is set by the client (and depends on your negotiating
skills).

Ideally, you have some unique skill(s) that are not available elsewhere.

Keep in mind that you will want to set things up in such a way that the
client perceives good value based on his/her valuation criteria.

Sometimes a client will get upset about the amount of fees paid to you
regardless of the fact that you saved them multiples of the amount paid out
to you. So it is wise to spend time on managing expectations and throwing in
a few unexpected deliverables. Since you are taking on a much larger risk,
maintain tight control and regularly keep the client up to date on progress.

I always use a 20% fee range when quoting on innovation. If the client is
uncomfortable with this, I charge a flat hourly rate to work on clarifying
the wild card elements that add significant risk to the outcome.

A few suggestions.


-- 
J.P. Solyom, B.Sc.E.E., M.B.A.
KS Business Development
Sales and Marketing Solutions for the New Economy
powerSales & mailSHOT - When you need a steady stream of qualified prospects
(253) 272-0996  [EMAIL PROTECTED]




On 10/3/03 1:53 PM, in article [EMAIL PROTECTED],
"Mark A. Richman" <[EMAIL PROTECTED]> wrote:

> Does anyone use value-based pricing strategies in their fixed-fee projects?
> Do you employ some sort of formula to derive the value price based on your
> client's projected ROI for the project?
> 
> Thanks,
> Mark
> 
>