One of the things our annual survey has shown us year after year is that most people in our industry are not charging enough.
When an Administrative Consultant doesn’t charge enough, it’s difficult, impossible even, to create a profitable, successful practice—the kind that allows you to quit your day job (or in the case of single moms, create the kind of real livelihood that will support their families). When you aren’t earning well, you begin to question your worth. Feelings of resentment arise.
To make more money, many people think the only option is to take on more clients. But that’s not exactly the answer, especially if you’re already managing at capacity. Overwhelm and burnout soon ensue.
Some think the only way to make more money is to turn into a virtual staffing agency or admin mill (where the work is farmed out to cheap, exploited workers, which is not in the best interests of clients). But, again, that’s not the only answer. You have to drum up even more business, be on even more of a hamster wheel, and become more of a people manager in order to create any kind of profit in that kind of business.
You lose significant control over the quality and delivery of service. Your overhead doubles, even triples. Your marketing and networking requirements are multiplied. Your administration increases and becomes more complicated. And the people doing the work don’t work for free, no matter how cheaply you get them to work for you (and honestly, does exploiting others and having them devalue themselves for your benefit really feel good to you?).
So your profit margins become even smaller. And because you are now dependent on an even higher volume of clients and work to make up for these multiplied costs in such a business, you can actually end up earning exponentially even less money than before!
Many Administrative Consultants know they aren’t charging enough, but fear holds them back. They’re afraid if they increase their rates, they’ll lose their current clients.
Sometimes it’s a lack of confidence because they are new in business, not sure of themselves and still carrying over employee mindset (or being told by idiotic “training” organizations that just because they’re new in business they shouldn’t be charging as well as anyone else. WRONG! Not only should they be ashamed of themselves for telling people that, but with advice like that it’s clear they have no business teaching anyone about business.)
I won’t lie to you. It is very true that if you raise your rates, you may lose some current clients. It’s always hard to make change with those who have gotten used to being spoiled and having you devalue yourself. But some loss is a actually a sign of growth, of growing into your strength and standing for your place in the world. You will never grow if you don’t ever upset the status quo in your business and aren’t willing to accept risks.
It’s important to understand that there are always going to be clients that you outgrow throughout the life of your business. And when you do, you make room for the more ideal in your business—those new clients who come into your life having more appreciation for what you do for them and happily pay well for it.
You being poor does not contribute to helping make the world a better place. Nor does helping make the world a better place require you to be financially unsuccessful. In fact, you being financially successful in your business affords you more opportunities and ability to put people first and do good in the world as well as for your clients. 😉
Clients aren’t the only ones who have a right to their dreams—you do, too! But you won’t ever reach those dreams if you don’t step outside your comfort zones and take some educated/informed risks. It may never feel completely comfortable raising your rates. You can be bold or you can take baby steps—either way, it’s all forward growth. So just do it!
The first step in setting these intentions is getting clear about what it really costs to run your business and what you need to earn for your life, so be sure to download the free ACA Income and Pricing Calculator.
Now ask me for some tips and strategies. 🙂
(Originally posted on my old blog on September 14, 2009.)