michael
THE 5 MINUTE FRACTIONAL CFO

069: 3 Non-Obvious Hacks For Raising Prices

Jan 26, 2024

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069: 3 Non-Obvious Hacks For Raising Prices

Jan 26, 2024

Read time: 3:05 minutes  

In today's edition, I'm sharing 3 non-obvious hacks I have discovered that have enabled me to increase the pricing of my CFO services without working more.

Most fractional CFOs (incorrectly) believe that pricing is a function of things like: 

โŒ How pretty the website is
โŒ How many hours you spend per client
โŒ The complexity of your charts and graphs

And since we (incorrectly) believe those things, we spend inordinate amounts of time and money on building a better website, finding ways to spend more and more time on each client, and hiring UpWork gurus to beautify our spreadsheets. 

This results? 

โœ… Prettier websites
โœ… You working more hours
โœ… Fantastic looking spreadsheets
๐Ÿคฎ The same pricing you had before all of that investment

So how DO you raise prices for fractional CFO services? 

After running my firm for almost 8 years and coaching hundreds of other firm owners, I've found the top 3 factors that result in charging higher prices for fractional CFO services.

By solving for even 1 of these 3 factors, you'll be able to bump up your prices, increase your profits, and do it without working a minute more.

Let's go...

Factor #1: Mo' Money, Mo' Problems

The first lesson I learned when it comes to charging more for my CFO services is that I have to work with bigger clients.

So let's kick this off by stating the obvious: 

The smaller the client, the less likely they are to be able to afford your price increases.

There are 2 primary drivers here: 

1: The math doesn't work.

A business that is doing $500,000 topline doesn't have the margin to afford $5,000/month fractional CFO services. 

It's a simple matter of math - and the math isn't working in your favor.

2: Small businesses have small dollar problems.

The problems that smaller businesses face typically have smaller financial consequences to them. So it's hard to justify paying a larger monthly amount for the person who's providing the solutions to those problems. 

In other words, the ROI just isn't there.

That's no shade against you or your skills, there's just not enough meat on the bone.

And here's the juicy part - as you start working with bigger and bigger clients, not only will you be able to increase your pricing for those clients - but those bigger clients will EXPECT to pay more. 

Factor #2: Increased Pricing Requires Increased Confidence

One of the biggest unlocks I've discovered when it comes to increasing my prices is that there's one HUGE prerequisite: 

Before I can increase my prices, I have to first have confidence in those prices.

Buyers will sniff out your insecurity and lack of confidence REALLY fast, and your price increase will be dead before you start.

So how can you get a level of sales swagger that will land you bigger price points? 

Here are a few tips: 

โœ… Have a sales call framework: The number one thing you can do is have a dialed-in sales call framework. I teach mine HERE absolutely free
โœ… Know your value: It's easy to charge 2x more when you know you're delivering a 100x ROI. But how do you know what the ROI is of working with you? Track it! Quantify the results you get for your clients. This will give you the confidence you need to charge more. 
โœ… Get reps: The surefire way to get more confidence is by getting more reps. You can't hack this. You just have to do the work. 

Factor #3: Focus On Better Outcomes (Not Doing More Things)

The biggest mistake I see when it comes to raising prices is the idea that you need to increase the number of hours you spend on a client or the quantity of deliverables you provide to justify a price increase. 

This isn't true.

Clients only care about one thing: outcomes.

So the question you have to ask yourself is how can you create better outcomes for your clients?

In the world of fractional CFOs, outcomes come in the form of: 

  • Lower risk
  • Lower taxes
  • Increased time
  • Increased cash
  • Increased profits
  • Increase revenue

Find ways to create those outcomes and you'll be on the fast track to justifying higher prices. 

In summary, there are a lot of distractions that will try to lure you away from the real things that will unlock higher prices for your fractional CFO services.

Focus on: 

๐Ÿ‘‰ Serving bigger clients with bigger problems
๐Ÿ‘‰ Increasing your confidence
๐Ÿ‘‰ Delivering better outcomes

Higher prices will follow.

Your Coach, 
Michael

Whenever you are ready, here areย 2 ways I can help you:

  1. The Inner Circle - every month my team and I go live and share the most impactful lessons we've learned in our journey to start, scale, and optimize our own CFO firm (including live Q&A). Plus you'll get access to our private community of nearly 200 fractional CFOs.
  2. If you'd like more amazing (and free!) content about starting, scaling, or optimizing your Fractional CFO firm check out The CFO Report.

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