The Truth About Hourly Rates & Pricing Strategies

Rob  00:00

All right.

Rob  00:07

Welcome everybody to The Slow Pitch. And today we have a special guest. Today we have Robin Waite, and he’s an author of the book, take your shot. And he does a bunch of different things surrounding business, sales, all that good stuff. And fearless business is his name of his business, but Robin, why don’t you say hi and give your give us a quick introduction who you are?

Robin Waite  00:26

Yeah, thank you. I really appreciate you having me on the podcast as well. It’s a real pleasure to have this conversation. So aside from being a business coach, which I do through the coaching practice, which is obviously as you named, his Fearless Business, I’m a dad, dedicated, husband, cyclist and surfer, and really.

Robin Waite  00:45

I’m trying to work my way into early retirement, but by that, I mean I’m going to carry on doing the stuff which I love, which is coaching small business owners. Where I say retirement, it’s all about figuring out how to have fun and joy from my business and combine it with my personal life and make sure that there’s no work life balance. It’s just balance. That’s the idea.

Rob  01:03

Yeah, and there’s, I think there’s a lot of people out there who don’t understand that work life balance is really about getting kind of what you want out of life, and not so much. Hey, I need to have equal parts work and life, right? It’s, it’s what do you want, right? I think that’s kind of the message I heard from your your YouTube channel, your book. That’s kind of what I’m getting at it from you, right? Is that, am I accurate?

Robin Waite  01:24

Yeah, absolutely, 100% I think, firstly, I think a lot of people take business far too seriously. And, you know, you spend aside from sleeping, you probably spend most of your waking hours actually at work, you know. So it has to be fun. It has to be enjoyable. I think there was a statistic.

Robin Waite  01:39

I don’t know whether this is a global statistic, which I heard, but somebody did a poll, and they said, apparently, 40% of people are unhappy in their current job or business or work, whatever it entails they do on a daily basis.

That’s really sad. Are you think of like 40% of the human population are out, you know, working age, that’s billions of people who are out there miserable doing this thing, which they show up to every day. So I think there’s better ways to run a business and certainly integrate it into life in a far better way.

Rob  02:09

And what’s even weirder still is I think there’s probably a percentage of those who own the business who feel that way, which is even scarier, right? It’s I don’t I don’t know how that happens. So let’s put it this way. Today, we’re going to talk a little bit about pricing.

Rob  02:22

We’re going to get probably in a bunch of different areas, but we’re going to talk about pricing and how, as a business owner and as somebody that’s in sales, how important pricing is, and what you can do to maximize your efforts in the price area where you’re where you’re getting most out of your dollar or most out of your time, and maximizing the price that you’re charging, but still also being fair, right? So getting the value that you need out of that.

V/O  02:44

This is The Slow Pitch Podcast. So let’s kind of dive into a little bit.

Rob  02:50

First of all, you had sent me a book because we were talking a little bit on the phone, and it was very interesting listening to some of these you were saying, and and then I got your book and I started reading it, and I and of course, between the time of recording, at the time that I got the book, it didn’t have a good chance to get the whole thing done, but I got a lot of it done.

Rob  03:04

I found that the story resonated with me and some of my past in that I’ve been in the position of the main character, I’ve also been in the position of the other character that’s involved. And so can you give us a little high level the storyline that you have in this book? Because I think that’s one component that’s one component that’s going to be important to then we get to pricing, right?

Robin Waite  03:23

Yeah. So the it’s told as a parable, so it’s only, it’s a short book, and there was several books which kind of inspired me to tell it as a story that way. But there was, there was a few things which I wanted to get across in the book. So first and foremost, I wanted, there was five simple business models, which it was really important that I could get them across in a simpler way as possible.

Robin Waite  03:43

And the story starts off with Russ, who is the main character. He runs a golf pro business. I’ll try not to give too much of a spoiler alert, in case anybody does want to go and read it. But, and it starts off, it’s like a murky sort of morning when he wakes up and he’s like, Oh, I’ve got to drag myself out of bed away from my family to go and run, you know, get my business off the ground.

Robin Waite  04:02

And, you know, as he’s driving into work, his first client cancels on him for the day because it’s raining, you know, it’s a set in England, of course, it has to have rain in it, you know, naturally, yeah, of course. And gradually, as kind of the day goes on, more and more clients sort of cancel on him, and he’s lose, literally losing cash, because clients typically paid him at the end of the session.

Robin Waite  04:20

And he’s, he’s really getting to a point where he wants to sort of quit his business. And then, you know, there’s a bit of the hero’s journey, the arc which comes into it. So he meets a business coach, who then sort of starts to transform his life. You know, they swap, swap services. So as he’s giving the coach some lessons, you know, he gets some business coaching advice back, and, of course, he turns his business around. So what most people don’t know is actually the it’s based on a real story.

Robin Waite  04:48

So it’s my first coaching client, which I took on back in 2016and a lot of people ask me, Well, which character you are you in that story? Rob? So I was actually not gonna, I’m not gonna say, right? Because I want people to try and obviously work it out, because there’s a bit of everything in there.

Robin Waite  05:04

But the one bit which a lot of people miss is that it’s, it’s I tell it, it’s quite an emotive story. And Russ, the main character who it’s based on, I found it quite hard to actually get draw the emotions out of him, to put into it. So the only point of reference I had was my own business journey over the last 20 years, which so where you hear some of that emotional part? That’s me, yeah, you’re hearing it.

Rob  05:25

Yep. I figured.

Robin Waite  05:26

I’ll let you figure out the rest of the characters in the story.

Rob  05:28

Yeah. I thought it was a great story because it does a good job of, first of all, if you’re going to England, any area in Great Britain, you’re going to want to go golfing. That’s number one rule, right?

Robin Waite  05:38

Yeah.

Rob  05:38

But number two, it made me think about kind of how real that is for anybody that has a business of their own. They’re the solopreneur, that individual who is running a business, they’re trying to do everything, and they don’t necessarily know everything right?

Rob  05:52

So you’re like, trying to figure everything out, but then how do you know what you should charge? And I think back to my days, early days of even the business that I’m in, trying to figure out what’s the right price. How do I figure that out? And, and, you know, what is everybody else charging?

Rob  06:05

And I think that’s some of the things that you know. You end up talking about a little bit about, how do you know that they’re charging the right numbers? How do you know that they’re charging the wrong numbers? How do you know you’re charging the right number? All of those things are good questions that come into mind. And I think, you know, how does one figure out? How would you do it?

Rob  06:21

Just because I can tell you how I would do it, how do you figure out where to price your services or a service? I mean, you do business coaching. How do you help people determine that number? Because it’s an arbitrary number, isn’t it? I mean,

Robin Waite  06:35

Yeah, well, again, bit of a backstory to this. So I did a study when I first started, of about 200 businesses. I got them to fill out 20 questions and scale each part of their business on a scale of one to 20.

Robin Waite  06:46

Question number one was rate your business plan on a scale of one to 10. And through about 76% of clients rated it four or less… so their business plan was substandard, and something like 25.6% of the people who filled out graded their business plan one essentially, which means that their business plan was non existent and they didn’t refer to it.

Robin Waite  07:08

So I’ve come up this concept around setting prices, especially, which is what I call goal focused pricing. And it becomes your business plan on a page. It’s like your one page. “This is what our business model looks like.” So an example that I give. And I’ll keep the numbers nice and simple. Imagine that business owner wants to earn $100,000 a year. That’s their first year goal. And the next question I would then ask, well, that’s great.

Robin Waite  07:30

So but you’ve got this product, it might be there are web designers, they’re going to sell websites. For example, how much you’re going to sell your websites for? And they say, Oh, well, roughly $1,000 say, okay, great. So what we do is we do is we take the big number, divide it by the little number, and then that’s the where the third question comes in. Great. So you’ve got capacity to deliver 100 websites this year.

Robin Waite  07:49

That’s normally the point where their eyes pop out of the head or through the glasses, and, “Oh, gosh, no, I don’t. Couldn’t possibly build that many websites. You know, it’s just ridiculous.” That’s two a week, let alone getting the clients right.

Robin Waite  07:59

So we’re already getting not just into pricing, but we’re getting into supply and demand, sort of the basic economics of how a business stacks up. So then we query it. Okay, great. Well, so how many websites do you think you could deliver? Then? Like, what’s your capacity?

Robin Waite  08:13

And they might say, well, maybe 20. So what we’ve got now is we’ve got a gap between the $1,000 they thought they should be charging, maybe based on their competitors, or other other things which they’ve seen, maybe their own value system, and somehow we’ve now got to elevate them to $5,000 for this on average, you know, website which they’re going to sell.

Robin Waite  08:32

So I’m, I’m not a fan at all of just 5x in your prices, and that, that being, you know, there’s been the odd occasion where somebody is so vastly under priced themselves that we can do that. But the way I look at it is, if you’re charging five times more for something, your perceived value versus theirs.

Robin Waite  08:48

You’ve got five times the opportunity to stack even more value into your offer, which obviously then creates a better ROI for the customers that you’re actually delivering those websites for, or whatever your product or services.

Robin Waite  09:01

So we create this like virtuous cycle. So a lot of business owners, they end up in something I call the sales cycle of doom, when they sell for too little, okay, sell, deliver, sell, deliver, sell, deliver, sell, deliver, constantly, marketing, constantly chasing, getting the next sell, where’s next bit of money coming from, paying their mortgage, putting food on the table. Sell, deliver, sell, deliver, right?

Robin Waite  09:20

And then eventually they either get sick or have to go on holiday, so they have to down tools, and they take that, then when they come back, take a big, deep breath, and then it starts again. Sell, deliver, sell, deliver, sell, deliver. And so imagine, like, there’s like this orbit around business owner…

Robin Waite  09:36

That’s that force field of having to sell. The sales cycle of doom. If we charge more money, I we expand our gravitational field, what happens is, when you expand like a gravitational field, you end up with more time.

Robin Waite  09:53

Time goes slower, so you end up with more time to deliver a better quality product or service, which gets your client better results or outcomes on the back end, which makes you more referable, so your reviews and testimonials are far better, plus they also want to stick around and buy more stuff from you, so you make more money on the back end.

Robin Waite  10:10

And you end up with this really virtuous cycle where you can make significantly more money, but with far fewer clients. And then it becomes far more holistic, and this is why pricing is so important, because effectively, there’s three ways that you could grow a business.

Robin Waite  10:24

You can save some money, you can sell more of the same thing, or you can sell the same thing for more money. Those are the three really big options that’s it got right. Saving money for me is short term, very short term thinking, I think, during times of crisis, economic downturns, things like COVID, the pandemic, that’s a good time to really, you know, roll up your sleeves and save some cash, because you don’t know what’s coming basically.

Robin Waite  10:48

But, it’s short term thinking. It’s It’s hard then to eke out extra profit, to reinvest selling more of the same thing equally, comes with problems, because one when we’re talking about supply and demand. So imagine that client that goes, Great, I can deliver 100 websites. Say, fantastic, great.

Robin Waite  11:05

You’ve systemized. It’s process driven. Great. How many clients do you think you can get? And then all of a sudden they’re like, Mmm, right. We’re a new business. We don’t have, you know, even our own website, or any brand out there, or any social media or any marketing.

Robin Waite  11:18

And then they’re like, Well, I can only stimulate enough demand for 10 websites. So again, that’s another clue that then all of a sudden they’ve got to sell 10 times the amount, like do, 10 times the amount of marketing, sell 10 times the amount of websites.

Robin Waite  11:31

So that’s where supply and demand, like a really out of whack, and you’ve got to balance off the two. The great thing is, if you get your pricing right, and you end up needing half the clients, but you’re making double the money. Well, you can do half the marketing.

Robin Waite  11:44

Technically. I know it doesn’t quite work like that, but you get the picture. It’s all about finding that nice balance where you’re not overworked, you’re not going to burn out. Can have nice holidays with your family, get good quality clients coming through still, you know, and you’ve got a nice little buffer slowly starting to build up.

Rob  12:00

One of those things too, that if you layer on top of that, the old 10% rule, which this may or may not make sense for some people, but for me, what we do every year is we look at our list of clients, and we say, who are the bottom 10% who are the most pain in the butt that we didn’t deal like deal with, and it wasn’t worth the money? Those people need to go.And we should never let them hire us again.

Rob  12:21

Then the other one is just a matter of just like they just don’t have the abilities to pay the rate that’s required to keep up with the rest of the clients, and that’s okay, and that’s somebody that we can sometimes sub out. We can give to somebody that we know that charges less, and we don’t have to take anything off the top. We could just hand it away.

Rob  12:40

Because what you’re right, it frees up the time to be able to service your existing guests, clients, whatever, so that you know you can get what you need for your clients. And I think that’s dead on.

Rob  12:51

The more that you can make it so that the value that you’re providing gives them what they need, and then some for the dollars that they’re paying, they feel happy and you’re being you’re happy because you get enough for what you should be getting, right?

Rob  13:05

Yeah, you know, I heard you a while back on on one of your podcast episodes where you talked about how an hourly rate, charging an hourly rate is like highway robbery. You should never do that. When I listened to that, I thought, you know, you’re right.

Rob  13:20

I hadn’t thought of it in those terms that you had put it in, but talk me through why I should never, ever make myself an hourly rate. You know, there’s times that you can, I’m sure, but like, why you shouldn’t be represented as an hourly rate, and if you do, how to make sure that you’re doing it right?

Robin Waite  13:36

Yeah, I had a lot of pushback, actually, when that episode came out..

Rob  13:39

No, I think you’re right. No, you’re absolutely right.

Robin Waite  13:41

The word I used was unethical, and all of a sudden you put big words in there like that, which carry weight for a lot of people. So they were like, well, that’s just ridiculous. And of course, what you’re getting is people projecting, because they know they’re selling out and they know you’re talking about them.

Robin Waite  13:55

So that was a fascinating just experiment in its own right. But yeah, that the only way I can explain this again, I’ll just use an example. So basically, what it comes down to is, when somebody’s selling hourly rates, the only person it benefits is the person selling the hourly rates, because if they want to make more money, they’ve got to sell more hours.

Robin Waite  14:12

Now, thankfully, most people are ethical, moral, upstanding citizens, and they wouldn’t just go out and Jack their hours up just to make more money, right? The fact that you could leaves wiggle room, that there will be some people who will do it, they’ll try it on.

Robin Waite  14:26

So the example I use is, again, we’ll go back to our our friendly web designer. And by the way, if anybody’s wondering why I keep referring to website design, it’s what I used to do for 12 years my agency. So it’s an it’s a before I started coaching. So it’s an industry I know, and it’s easy, yeah, easy to understand.

Rob  14:40

Everybody kind of knows.

Robin Waite  14:41

So imagine we had three web designers in a room, right? And web designer number a is charging 50 bucks now. And you ask him how long it’s going to take, and he says, Well, I think it will be 20 hours. So you go, Okay, again, $1,000 for a website. Sounds fair, but so off they trot, and then you don’t hear from them for three months. Like, Well, where are..and what they forgot to tell you was, they hadn’t been doing it particularly long.

Robin Waite  15:03

They’re not particularly that good at design or listening, and that because they’re not charging enough, they’ve got too many clients to service. So three months later, they come back and say, Here’s your site looks a bit odd.

Robin Waite  15:14

You know, from a design perspective, it doesn’t have the blog or the shopping cart you wanted, and then you’re there saying, well, I need those things on the websites hold the purpose of it so I could market my business and sell stuff. And so they go, Yep, we can that. We can add it on, but it will cost you an extra 10 hours. And you’re like, No, I wouldn’t. No, I’m not paying for that. We agreed on $1,000

Robin Waite  15:31

So what you end up with is a client that’s resenting working with you, and now you’ve also got a resentful web designer because they reluctantly agree to do the extra 10 hours for free, you know, because they don’t want to rub you up the wrong way.

Robin Waite  15:43

But everybody’s like at odds here. So that’s the first clue, that hourly rates don’t really work. There’s always friction within that. And you can start to see a few clues here, that skills and expertise experience, they have a lot to play within this, these examples as well.

Robin Waite  15:56

So website designer number two comes along, and they’re crazy, like their experience is just out this world. They’re brilliant. What they did have been doing for 20 years, but they don’t know what Robin and Rob now know about pricing, so they’re still charging 50 bucks an hour, but because of their experience, and they’ve got it all systems, process driven, they’ve got great systems.

Robin Waite  16:14

They turn it around within a week. You know, you’ve got your website back and actually billable hours. It’s only 10 hours. Well, hang on a second. So the guy who’s more experienced, who does a better job, and it looks great, and it’s got the blog on the shopping cart, gets paid half what the inexperienced guy got paid initially.

Robin Waite  16:30

So there’s our second clue that it doesn’t work. It doesn’t play to like the more experienced business owner, like service provider. And then we get web designer number three. Now she’s an absolute ninja. She gets like marketing. She’s read breakthrough advertising and by Eugene Schwartz, that was written in 1967 and she can sell ice to an Eskimo via a website, right?

Robin Waite  16:49

She just gets it, but she turns the website around in 72 hours. It’s actually doesn’t need a blog or a shopping cart, because she’s realized she can sell, get you leads just through a landing page, a well thought through, well written landing page, but you have to pay $10,000 for the privilege of it.

Robin Waite  17:05

However, she’s that confident in her ability to get you 15 highly qualified leads each and every month that if she doesn’t start achieving that within 30 days, she’ll refund your 10k and pay you $1,000 for wasting your time.

Robin Waite  17:18

So now you’ve got a completely different value proposition there altogether, because it’s solely focused on what is the outcome that the the end client desires?

Robin Waite  17:26

Well, look, let’s face it, in business that we do need to make some money that’s important, but leads and inquiries and building relationships really is where it’s at. And so if she can build a landing one page, landing page that creates the outcome, why shouldn’t that be worth more because of her experience? And I think the challenge that a lot of people have is they…

Robin Waite  17:45

One, they struggle to articulate the value of what they offering can actually do for the client, so they focus very much on like features. So I’ll build you a five page website with a blog with a shopping cart, and they start adding more features to make it look fancy or sound fancy, yep, because it’s easy to solve that, and they’ll sell 50 bucks.

Robin Waite  18:04

Now, because it’s easy to 50 bucks is a small number, but you get, you get a picture, right? It’s easy, easy to sell50 bucks than a 1000 bucks thing, right? So what? 50 bucks? Because that’s easier. So everything is always working in the favor of the service provider, and we need to flip that on its head. It has to be about, can I deliver this full and remarkable solution to a client that ultimately meets their needs?

Robin Waite  18:27

And this is where the ethical side of it comes into it, because now, now I’m no longer qualifying whether I take this project on based on how many hours can I sell. I’m qualifying it on based on whether I can actually deliver that outcome or not.

Robin Waite  18:40

And there are people who will still take work on knowing full well they can’t deliver the outcome. That’s why they don’t do it that way, right? They’ll just deliver a website doing using the features, which they said, again, doesn’t happen often, but it does happen really. I want people to when you start to think about the outcome which you’re delivering, make it about I’m going to save you time.

Robin Waite  19:00

We can grow your business through reaching more people. We can grow your business through converting more people. We figured out a way that we can get people to come back and buy from you, 2345, times through the services which we provide. So make it really think about what their their dream outcome would be.

Rob  19:17

To me, what I’m hearing is kind of, you know, if, for people that listen to the show on a regular they they’ve heard me say you’re selling on what they need, and you’re kind of saying the same thing. It’s like, okay, what does this person need from you?

Rob  19:33

So if, if they’re needing business consulting work from you, and in your conversations with them. I’m sure you’re asking a bunch of questions before you decide whether or not to take them on, and once you decide, okay, this is a person that I think could use the services that I have, and that we can help them with this problem.

Rob  19:53

And that there’s a value for them to understand, that they can actually change the way they do business in such a way that they have more time or more money or more whatever that they want based on these things and what we’ve done before…

Rob  20:06

That’s a value that’s worth a lot more than just an hourly rate, right? So, so to me, I feel like, so the next question is obvious then, and I think, you know, again, people that have listened to the show may have heard some of this before, but like, it’s different, but hearing it from a different perspective, how does one stop offering their services at an hourly rate?

Rob  20:27

Because at the very beginning, and when my wife and I started the company, or when she started the company, she would start it out as, these are the things I’m providing. These are the things that I’m giving you, this many hours of work, this, this, this and so you could easily calculate how much things ran, yeah, until we started to figure out, “No, no, what they want is it’s going to solve this problem and that problem, and it’s going to solve both of them,” …and they don’t have to worry about that problem anymore once they have this in hand.

Rob  20:51

So that’s worth how much to them, and that’s really what the way the sales process kind of goes. Because if I can sell something for $100 that’s going to generate 1000s of dollars. It’s a value to them. And again, it’s all relative, right?

Rob  21:06

So I’m not going to do anything for $100 but whatever I give, whatever I provide, gotta be worth 10 times, or at least that, yeah, more to them in value over the course of how many years, right? So how do you switch from that hourly mentality for somebody that’s smaller, who thinks that’s the only way, because that’s the way everybody else is doing it. How do I switch that mentality? Because it’s, to me, it’s fully mental, right? Yeah, like, it’s not, not a require, not a requirement.

Robin Waite  21:30

So the the phrase I, I want everybody to sort of remember at this point is you’ve got to learn to do and be disciplined to do one thing really well for one specific type of client. Again, the reason people don’t do this is because their ego gets in the way.

Robin Waite  21:46

I like the variety of clients I get to work with. I like the variety of the work which I get to work with, right? But then you’re a jack of all trades, master at none. There’s a responsibility, actually, to build like a really boring business in many respects, right?

Robin Waite  21:58

One thing really well for one specific type of client, and then you do it 1000 times, you become an expert at expert at it. You can get repeatable, the same, repeatable results for each and every client which you work with.

Robin Waite  22:08

So again, just as a simple example of this, so I had a client who was a virtual assistant. So they’re very traditionally, like hourly rate type work, or you can buy bundles, and like 10 or 20 hours a week, for example. So she was, she was charging about 25 bucks an hour for her work, and struggling to get clients.

Robin Waite  22:24

She just couldn’t, like, you know, she was doing anything from email management, diary management, writing blog articles, doing social media posts for you name it, just general sort of admin work for small business owners.

Robin Waite  22:34

But she really struggled to get clients on board with that, because it was like, Oh, well, I’ll do anything you want. And the business owners, they’re going, I’m struggling, but I can’t think of anything that I need to give to you. To give to you right. When we were chatting, it took a while to sort of doing some digging. And, like I always liken myself a bit to inspect to clue that, you know, you have to Miss Marple.

Robin Waite  22:51

You’ve got to go out and find the clues like, what? What is something? Where’s the gold within this? The clue that we, you know, the thing that we can hang our hats on. And so with her, we got talking about podcasts. And she was, like, she loved podcasts.

Robin Waite  23:03

If I could make some money out of doing something in podcasting, I would absolutely give up my VA work. I said, Well, funny enough, actually. And this was a few years back, so I was, I was starting to get on the podcast, or the training guesting. And I said, Listen, do you think you could find me a few podcasts to guest on?

Robin Waite  23:19

So I said, Look, what if? What if I paid you to go, a fixed fee to go and find me 10 podcasts. And so during that when I ended up paying her $1,000 so I was her first customer. I was a slightly tricky customer being the first, because she had to start building up the processes, systems and the database to, you know, the podcast that she I could guest on, and start to sort of, you know, build their pull everything together.

Robin Waite  23:42

But the second client came along, and guess what? They were another business coach. So she went to the same podcast post that she booked me on. They’d had a good experience, hopefully, and so then it became a really smooth way to get them booked onto podcasts, because she didn’t have to go out and do masses of extra research.

Robin Waite  24:00

And what happened was she got to a point where she could book somebody onto a podcast within 15 minutes, on average, that was the amount of time it would take her to do few emails, bit of back and forth, get the diary booking done right, move on to the next one.

Robin Waite  24:15

And if you work that out, she had effectively moved her hourly rate up to 100 bucks an hour, so $1,000. Ten podcasts, and she was doing it in 15 minutes. So she 4X’d her effective hourly rate just by doing that one thing really well for one specific client.

Rob  24:32

Interesting. When somebody does that, do they need to change their branding? Do they, I mean, how do you because then all of a sudden they’ve done and operated differently. Does there need to be any changes at all from the business standpoint, or is that just like, hey, we’re just transitioning?

Robin Waite  24:46

Not even that, really. I mean, in her instance, because she was so small and didn’t have many clients, it like she didn’t really have to change anything. It was just a, you know, she when, when she started sort of outreaching and networking things like that, she just changed their messaging.

Robin Waite  25:01

Again, this is something which business owners get, like, hugely wrong. They think that they have to have, like, the perfect product with the perfect website and the perfect branding, and, you know, all of these things. I’m the I always say to people, it’s the opposite way round.

Robin Waite  25:14

You need to test the market first and see, see if you can stimulate some demand for this product or service, right? Because there’s no point spending a year like perfecting everything and then launch it into cricket, you know, and get no feedback.

Robin Waite  25:25

So I’m very much like says another an author, guy called Daniel Priestley, who is just brilliant. He’s sickeningly smart. This guy is just a really unique take on sort of everything in regards to business. And really look up to him.

Robin Waite  25:39

But he has a book called over subscribed, where he talks about essentially creating a wait list. So before you do anything, before you even really design your product, create a wait list. Because if you can’t get 100 people into a wait list to sell, like, 10 units of your product, you probably shouldn’t launch the product, or your messaging is wrong, or there’s something not quite right there.

Robin Waite  25:59

And wouldn’t that be great if you could spend a week trying to get 100 people in people into an email list, but as a part of that process, then find out, well, actually, nobody’s really that interested in it. All you’ve done is you’ve lost a bit of time building waitlist.

Robin Waite  26:11

You haven’t, you know, put energy or emotion into building a product, so it’s an incredibly effective, like, way around things. So yeah, big fan of waitlist, big fan of getting oversubscribed, then when you sell 10, then build it. Bit risky, but it does work.

Rob  26:26

Yeah, I am too. I There’s a lot of people that you know I’ve talked to who just want to I’ve got this great idea. I’m gonna build it, but let me start working on it. Like, how do you know you’re not solving a problem nobody even knows existed and wants to even solve like that makes, to me, it’s, yeah, sounds like maybe a good idea. But have you had people ask for that or that kind of thing? So yeah.

Rob  26:43

And I just got a conversation with somebody this morning about something very similar to that, and they were trying to decide whether or not to repeat something that they just did. And it’s like, okay, so a series of questions comes up with, probably not, let’s not repeat that, because that was actually not as productive as we thought. Yeah.

Rob  26:57

So yeah, I I hear that. I think the the one of the questions that I wanted to ask you about too, with pricing is there is a psychological barrier for some people. I don’t know how many times you’ve seen this, but to me, if I’m talking to somebody, let’s say, and I feel like this is going to require that I charge instead of, let’s say I’m charging $1,000 I now need to charge $50,000 and to me, I just can’t, I can’t imagine doing that.

Robin Waite  27:24

Yeah…

Rob  27:25

Have you encountered people that have that issue and ever had that problem? Because I know a lot of people do, but have you encountered that before?

Robin Waite  27:32

Yeah, all the time. Actually, it’s, it’s really common.

Rob  27:35

How do you, how do you deal with that? Then, how do you? How do you as a somebody that’s helping them in their business. How do you get them to get past that mental block? Because to me, that block, as soon as you release that block, I had that block, and I had somebody help me with that, and it was like life changing. How do you help them change?

Robin Waite  27:56

The best way I can do it is by doing a bit of a role play. Would you be open to that? Rob?

Rob  28:01

Yeah, sure.

Robin Waite  28:02

…and then I’ll break it down afterwards as well, so that we everybody get the gist of it. You’ve had some help with this, so you might have to hammer up a little bit just to pretend you’re kind of new business owner starting out. But let’s look. It’s helpful if we bring a little bit of reality into it.

Robin Waite  28:17

Okay, so imagine there is a product which you would you would love to sell. It can be one which you’ve kind of just been thinking about to necessarily be directly related to your business. Do you have a product in mind?Something big and expensive that you think, Oh, be a dream to sell this.

Rob  28:32

Let’s say I want to sell high end cars.

Robin Waite  28:35

High end cars. Okay…

Rob  28:37

It sounds odd. Or is this something would be better.

Robin Waite  28:40

I think a service would would work better, either related or just something you’re interested in. I noticed you’ve got, like, you’ve got a picture of some waves behind you. Do you like traveling?

Rob  28:50

Those are the Cliffs of Moher. Yes.

Robin Waite  28:51

Okay, so, so imagine, imagine you were setting up a travel agency, a luxury travel agency, okay? And yeah, let’s say, for example, if you were, your sweet spot is helping high net worth individuals to book the holiday of a lifetime. So it could be like an adventure holiday, or a sailing holiday, or the trip around a Mediterranean or the Caribbean, or some, I don’t know, something, just something big for all of their family, right?

Robin Waite  29:16

Imagine we were starting out. How would you how do you think you would charge for that currently?

Rob  29:20

Yeah, well, I’d say I would probably look to find out where you want to go, and then look up pricing online, and probably add a percentage to that.

Robin Waite  29:28

You’d add a percentage, okay, so, and what would be a fair percentage?

Rob  29:32

Maybe 20% at the most.

Robin Waite  29:35

Okay, so let’s say, for example, the client had a budget of 100k to spend. So you’re, I can add 20% on top of that. So your, your cuts going to be 20, 20k right? So what would it?

Robin Waite  29:48

How would it feel, though, if imagining the actually you were going to put together, maybe a package that was 250k for that client, but you get to keep the vast majority of it, because, you know that the cost base is kind of fixed, but you can create a holiday, massive, a really great holiday concierge service, you know, it gives you a bit of bandwidth. So actually, your mark.

Rob  30:09

Wait, so this person is going to get a $250,000 vacation for the same price.

Robin Waite  30:15

So imagine that, yeah, so imagine that you’re, essentially, kind of like creating extra bandwidth on top of that 20k that you’re going to earn from it. So maybe, actually you’re, if you were going to charge a fixed fee for going out and finding…, like, regardless of whether the holiday is like 10 bucks or 250 bucks, you’re going to charge a fixed price rather than the percentage.

Robin Waite  30:36

So you can find this fee is like now you were talking now about 20k but what if, actually, it was maybe 50 or 100k.

Rob  30:43

Okay, okay, I’m listening. Okay, great. Okay, I’d be interested. I don’t know how I would do that, but yeah,

Robin Waite  30:49

Great. So, so we’re kind of like you, so what we’re trying to establish here is what we call pricing bandwidth. So a lot of people see pricing as being or selling a product as being binary. It’s either too cheap or too expensive. Iremember out it’s a yes or no, yeah, I can do it, right?

Rob  31:03

So yeah, the back of my head I’m thinking, that’s really expensive for a vacation, for a holiday, like, that’s crazy.

Robin Waite  31:10

You could blow that on four days on a Mediterranean sailing cruise, right? If you hire a lot of yacht and you know, all of everything that goes with it, right? So you can do it. You can spend that money quite easily. I would like, I’d love to be in a place where I could do that same.

Robin Waite  31:24

So what we what we’re trying to establish is like,how wide is that bandwidth for you? So you’re just thinking about your fees within it. So we start at 20k because that’s where you initially pitched me at. But imagine if three years time, actually, people come to you and they’re willing to spend actually, not just for the whole holiday, but just just for your cut, because you’re so well known at finding people amazing holidays, $250,000

Rob  31:48

Wow.

Robin Waite  31:49

Could you see doing that?

Rob  31:51

Yeah,

Robin Waite  31:52

Okay, good, but maybe not today.

Rob  31:54

Not today.

Robin Waite  31:55

Okay, so in the future, yes, version of Rob could sell that. But today, we’re kind of round about the 20k mark. Okay, what I’m going to do now, and this is, you know, you don’t necessarily have to say anything at this point, but I’m going to say some numbers, and we’re just looking for a few signals, just to know when it’s starting to get beyond the realms of possibility, okay, when it gets a bit uncomfortable.

Robin Waite  32:12

Okay, so, and we’re going to go and we’re going to jump in numbers, because it just for expediency. Okay, so we’re going to start at 20k so, 30k 40k 45k 5k, 50k, 60k we’re starting to lift right, interesting. So you vocalized that.

Robin Waite  32:28

So what I’m looking at as we just for the benefit of those listening to this, I was looking at Rob’s tonality, body language and pacing and his eye movements. I was looking at lots of different things were going on there, but Rob also vocalized it, which was quite helpful.

Robin Waite  32:42

And what happened around about 50, because it’s a podcast, yeah, 50 to 60k was where we went from uncomfortable, or sorry, from comfortable into outside your comfort zone, right?

Robin Waite  32:52

So here’s the interesting part, when we try to solve that pricing problem intellectually, up here, 20k was the number we ended up with, right? I know we didn’t put too much thought into it, but 20k was where the rationale, the rational point where we went, Okay, yeah, 20k I felt it, yes, right?

Robin Waite  33:09

Then we tuned into Rob’s subconscious, how he feels about himself, how he values himself, right? Which doesn’t have a voice necessarily. It has to voice it through Rob. But how much you value yourself? Rob spoke to us and said it was worth two and a half to three times. What intellect our intellect settled at right? Do you see? Tells you a lot? Yeah, exactly.

Robin Waite  33:29

So a lot of the time, people try and solve meaningful problems like pricing, as we do, because we think we’re smart, and we try and intellectualize it. We put it into business plans, which is sensible, but we we run spreadsheets and run the numbers, and we look at what our competitors are doing and all these different things.

Robin Waite  33:45

But deep down, most people know that they should be charging more. They feel it. They’re like, they get that little and, you know? And we know when we’ve done it, because we get off a call and the client’s been really quick to say yes, and we get damn I should have charged more, right?

Rob  33:58

That’s, that’s the worst, right? Yeah, everybody has that. At some point in time you’re gonna hit that, yep.

Robin Waite  34:02

Yeah. And it’s, and it’s not because they’re greedy, it’s just because they’ve had this moment of realization, I am worth more. Yeah, right. So, so that’s, that’s one way that we look to establish sort of that pricing bandwidth. And yes, there is a future version of you that could get to 250k in, in in this product, right? But what we would do is we would Okay, great.

Robin Waite  34:22

Now go and pitch the next 10 people who come to you want a luxury holiday we’ll pitch them at 50k fixed fee, no matter what their budget is, so the holidays on top, but to get you to book their holiday of a lifetime, where there are never any problems, everything is all taken care of, from luggage to the towels to everything like you, name it. We start 50k we pitch 10 people, and we sell one or two.

Robin Waite  34:45

From there, we get immediate validation. In fact, the validation typically comes just before we sell something. In the pitch, just before we sell something, just hearing ourselves say those words, you hearing yourself say, Yes, sir, it’s just 50k to invest in me to book your holiday, you learn something about yourself. You go, oh, yeah,

Rob  35:05

Yes, but you just taught yourself, yeah.

Robin Waite  35:08

So, so we always we work in those sort of milestones, right? First, we just want to get you pitching a new price, send a big number and get comfortable with that. And yeah, we’ll talk about sales objection handling and all that good stuff.

Robin Waite  35:18

But let’s just hear you say the price, then we close the deal that validates now that somebody wants it, if we can get two over the line, it’s now a happy accident. It’s not just a, you know, luck. It actually we we made a plan and we sold two, and it’s starting to become a bit of a pattern.

Robin Waite  35:35

And then what we do is we go through the same exercise again. Great, right now we’re starting at 50. We’ll do 60, 75, 80… Oh, okay, right. So next 10. You picture 80, so we graduate the pricing until we hit our dream number, essentially. there are these really done rules, which I don’t know who made them up or where they came from, that we just assume a gospel and write.

Robin Waite  35:55

So one of them, which you kind of alluded to, was only prices up by 10% right? Um, who made up the rule that we can only put our prices up on January the first and by maybe five or 10% which dumb idiot made that rule up? Right? Because you can, you can sell to 50k to somebody yesterday and 80k to somebody tomorrow.

Robin Waite  36:13

It doesn’t make it immoral or unethical, because the agreement was, it was with each of those individuals. Obviously, if they speak, it could be a bit awkward. You can raise your prices 12 times a year if you want to 24 times, 100 times you want to. It could get a bit confusing if you do it that many times. Yeah, right.

Rob  36:28

But I mean, there’s something to be said that if your if your workload is becoming a bit much because of your pricing too, you have to raise your price because you’re out of time. And to layer on top of what you’re saying, that if you’re changing your price to a point that you’re extremely happy, you’re able to make a lot more money, you can take on less clients, you don’t have to worry about it so much.

Rob  36:50

You have a lot more confidence then Right? So there’s a psychological confidence that comes up when you start doing it, as soon as you start selling at the numbers that are beyond what you’re comfortable with, you’re exactly what you said, which is you start hearing yourself saying it, and you start hearing yourself saying phrases in the sales process that you are like, I can’t believe they came out of my mouth.

Rob  37:09

But just by saying when somebody asks you an objection or a question, that you’re like, I mean, I had somebody that, it’s been a little while now, but somebody that came back to me and said, Boy, that price seems a little bit a little bit more than I expected. I just had somebody else tell me it was like 30% less whatever the number was.

Rob  37:25

And my answer back out of my mouth was, why do you think that is? And let them explain why, why my price is higher, because they can see my work, right? So that that whole mentality is a totally different mind shift when you start putting yourself into this position of knowing that the numbers that you’re charging are, yeah, they’re arbitrary, but they’re where you need them to be to do the work that you need to do, and they’re comfortable with it.

Rob  37:52

I wouldn’t charge somebody those numbers if they couldn’t afford it and it wasn’t worth it for them. If it was not worth it, and they couldn’t get the money back out in some form, way or another, then I would never do that. I would rather have them work with somebody that’s really inexpensive, that can help them basics, get those things done, right? Yeah.

Rob  38:08

So there’s a lot to be said. I mean, I, I think I just feel like that, that whole conversation you just had had me work through a work you know, just conversation like that, role play, that role play is a great example of how you as a listener, needs to think about how to price things and where are your limits. And if you don’t know where your limits are, you gotta find out where they are.

Rob  38:30

And then you need to keep pushing those numbers up until you feel like, okay, this is uncomfortable. Keep going. Don’t stop. The only way you should stop is that people tell you, No way. I’m never praying any that much. And it happens over and over and over again. And then you get to back it down a little bit, because that’s where the threshold is for the market, not for you, right?

Robin Waite  38:49

That’s it.

Rob  38:50

Am I off?

Robin Waite  38:50

No, no, you bang on. And I always say to people like, don’t, don’t believe everything you think, right? Because

Rob  38:57

That is a great I’m going to use that phrase, don’t believe everything you think, because that is so true. That is so true.

Robin Waite  39:03

Because you’ll have these crazy thoughts, like, you know, I use one which is, oh, we can only put our prices up once a year, you know. But you again, you alluded to something earlier on, which is like, Oh, we not every year, we go through our client base and we knock off 10% of our clients. Again, who made up this dumb rule that we can’t let clients go, or that no is an acceptable answer.

Robin Waite  39:05

Like, the goal in business is not to go around collecting as many clients as you possibly can do. The goal is to run a sustainable, profitable and, most importantly, fund business at the end of the day, you know, the moment you get those knots in your stomach tightening up because, well, in fact, I had it recently. I’ll share with you. Typically, I don’t tend to work before 10 o’clock.

Robin Waite  39:42

That, as a rule, has been for me, just because I do school run and like a bit of decompression and to have my morning coffee, and then I kind of get into my day. And for whatever reason, I booked in the point, which I thought was important at 9:15 so I had to rush back from the school run. Probably missed my morning coffee, be a bit grumpy and get on this call.

Robin Waite  39:59

So, anyway, that person canceled that morning as I was out on the school run, I felt relief. And ordinarily, like, asked me this, like five or 10 years ago. You know, I have been in business 20 years, but five or 10 years ago I’d have been mortified. Oh, God, was it me? What did I do wrong? Why didn’t they want to speak to me today? I hope they’re all right. I’d have really worried over it, but I was felt relieved.

Robin Waite  40:20

And I was like, that’s interesting. Why do I feel relieved? Yep, and you know, my head’s telling me one thing, but my heart clearly was in the space of God. I’m glad I didn’t have to do that. Call that morning lovely person. Like, don’t get me wrong, but

Rob  40:31

Yeah, well, there’s a there’s a difference… There’s a difference between, you know, who you are as a person, and that, that, that what, that reinforcement that you get from the potential clients or other clients, right? What they tell you? If they tell you, No, it’s just, it’s fine. Like, it’s move on. Who cares? Like, it’s okay, you couldn’t have that person, okay, no problem. Like, it’s not like, a big deal.

Rob  40:53

It’s like, almost as if you’re going to a stoplight and it turns red on you, okay, you can’t control it anyway. What’s the difference? Right? So what and if it stays green? Oh, good. Okay, great. It matters not in the rest of your life. What does matter is what lessons you learn along the way. And I hopefully, as people have listened to us chat a little bit about this, they’ve learned a little something so Robin and I really appreciate your time. I hope we didn’t miss anything that was really important.

Rob  41:18

But one of the things I do want to make sure that people understand or know is, if somebody wanted to get a hold of you, how would they do that?

Robin Waite  41:23

Yeah, absolutely. So two ways, actually. Well, I’ve got one, one something you can do to help me. The second one is a gift, which I’d like to give to, to you and what you’ve you’ve got one already, but to your listeners. So I’m trying to grow my YouTube channel. I’m trying to put out regular videos on there talking about all of the good stuff that we’ve been talking about today.

Robin Waite  41:39

So hopefully, if people just go and jump onto that onto YouTube and search for Robin Waite with an E on the end of it, they should find my channel and give it a little subscription. That would be amazing, because I’d love to spread the word to more people and just help more business owners.

Robin Waite  41:51

The second thing is a gift. So you’ve got a signed copy there, but I’d like to give a free sign copy to everybody who’s listening to this as well. Doesn’t matter where they are in the world. I’ll sign it, pop it in the post. Pauline loves me down at the post office because she gets a little time I take a parcel down there so, but they can get hold of that at Fearless.biz/tys, for take your shot.

Rob  42:12

Nice. Okay, great. Yeah, great book. It’s a nice, nice, easy read. Like it’s, to me is like, I was reading through it. I’m like, I I’ll finish it. Because this is not one thing with me. Is like, I get into books and I’m like, Okay, I can’t read this.

Rob  42:24

This is, this is something I can’t finish. Yours is, like a story that is engaging, and I’m like, I want to know what happens to this guy. So, like I said, I didn’t get a chance just for because I had about 24 hours to get through as much as I could with getting back from time away and and I just didn’t get get it in time

Rob  42:39

But I highly recommend, I will put a link to your book too, on Amazon. I think you have it on Amazon, right? Yeah, I saw it. Yeah, both. Yeah. I’ll put a link to it. Somebody wants, but if they want to send you a note, by all means.

Robin Waite  42:49

Yeah, I It’s one of my greatest passions, very I don’t know whether it’s a bit sad or geeky, but just when people reach out to me and want a signed copy of it actually means a lot to me to know that I’m actually putting something real into people’s hands.

Robin Waite  43:01

I think, like, probably my parting words are, like, in this digital era, like doing physical stuff is really, really meaningful and makes a big difference, so it’s the least, like.

Rob  43:11

There’s something to be said about that. Yeah, I’ll tell you what. You know, what? If you’re listening to this, no link for you, you’re you’re gonna have to go to Robin’s website and request it, tell them how to do it again.

Robin Waite  43:21

Fearless.biz/tys

Rob  43:24

All right, cool, Robin. I really appreciate your time. Hopefully people got something away from it. I put some links in the show notes so that everybody has it, how to get a hold of you, and also how to find you on YouTube and so forth.

Rob  43:34

I’ll use the link so that if they do go there, they have an automatic ability to subscribe, so that, because that always helps. And I really appreciate your time today, and it was a pleasure speaking with you about this. So until next time, everybody remember, let’s slow down and you’ll close more.

Rob  43:50

Thank you for listening to The Slow Pitch. Do you have a question about sales? Call or text your question at (608) 708-SLOW. That’s (608) 708-7569. Or you can email them to Questions@TheSlowPitch.com. Slow Down and Close More.

Rob  44:40

Thanks, as always for listening today. If you like this podcast, please subscribe and leave us a review. We really appreciate it. Follow us on Twitter, Instagram and Facebook at The Slow Pitch. We were mixed today, as always, by Johnny Polakis, and we were produced by High Gravity Studios. Music credits and other notes are in the show notes section on TheSlowPitch.com. And we’ll be back with another episode soon.