If you work with your clients to ascertain the value of the outcome (to them not you) _before_ starting on work, you’ll find it much easier to discover how much to charge. Sometimes you’ll discover the project doesn’t make sense for you… and sometimes you’ll even discover it doesn’t make sense for the client to pursue with you or anyone else!

Where your own personal value of your time comes into play is determining whether the clients outcome is valuable enough that you’ll be able to charge a sufficient enough fee that you are happy with. With this approach there’s no “guessing” (and hence uncertainty) about the value being delivered to the client. It also makes it obvious if the project is either (a) not a good fit for you (b) not valuable enough for the client to be considering [which offers an opportunity for you to help them re-group and direct their efforts somewhere more profitable for themselves, but that's a whole other discussion].

There are other important factors that should also be aligned to get this right: talking to an actual check signer (economic buyer, not just recommender) and digging into the clients desires (not guessing, not your own) regarding underlying objectives and measures of success. You also must get away from the poverty mentality (which, beyond changing your mindset, takes a strategic approach to marketing, namely client attraction) or you will find yourself making ill advised decisions to get through the short-run that end up hurting your business in the long-run.

I hear your frustration and can relate. I’m only just now “getting” all this (and, yes, my background is, in large part, in IT consulting).

I suggest reading several of Alan Weiss’s books. There are other folks too you may want to learn from (just a few off the top of my head): Jay Abraham (his most recent book The Sticking Point Solution is great), Fabienne Fredrickson (clientattraction.com), Dan Kennedy (dankennedy.com & nobsbooks.com), Joe Polish (joepolish.com), Robin Robins (technologymarketingtoolkit.com), Gary Halbert (thegaryhalbertletter.com), etc.

If you think this is just about setting fees, you may have a hard time accepting it. It’s about how you position yourself and that touches everything in your business. Recently I noted that Alan’s “Value-Based Fees” book should really be titled “Value-Based Positioning” or “Strategic Positioning” or some other broader title. It’s not just about setting fixed fees instead of hourly fees. Unfortunately, in my experience, that’s what a lot of folks come away thinking after reading that book (or reading or hearing a synopsis of it, more likely).

Alan does a good job explaining his concepts, but you still have to approach things with a very open mind. It’s not about just adding another quick-fix tactic to your arsenal. It’s about having a whole new strategy for your business. The other thing I’ve observed, besides some folks not really being open to the idea, is that most folks don’t really approach their businesses strategically (they may think they do but they don’t). Trying to explain to them how they should apply a completely different strategy is even tougher when they don’t actually have (or understand) strategy to begin with!

Not implying that’s your situation. Just giving you some context and some of my recent thinking in the hope that you might find it helpful.

(a shameless plug: I run a list @ http://www.ITConsultingLessons.com where I discuss these topics regularly. The aim is to introduce independent IT professionals (contractors, freelancers, consultants, etc.) to different perspectives related to marketing and success in their businesses. Feel free to subscribe if that theme interests you!)

-jr

Google Alerts told me you had posted this. “I don’t like charging a whopping fee” is something that you need to work on! Technical people seem to make excuses for why they can’t charge more. Self-defeating, low esteem.