Most if not all businesses begin with a vision, supported by a business model which correlates sales volumes with pricing and cost assumptions into expected revenues and profits. We all know from that point there are many variables which determine the actual outcomes of that business. Pricing is one of those variables and a very important one. Price too high and we constrain demand, price to low and we fail to realize a fair return, or even worse lose money. But an even bigger problem in the professional services industry is the failure of companies to control and realize the price they planned to receive for their service offers.
Have you ever heard these statements around the office?
- "Our average list price is $185/hr but our average realized price is $132/hr - why?"
- "The sales team is complaining that our rates are too high"
- "The competition has much lower rates"
- "That approach to pricing will never work in my market"
- "PS margins are too low - we need to lower labor costs"
If any of these sound familiar, then this white paper is a must read. Focusing on how to improve the often under-developed discipline of pricing in professional services operations, this paper will examine and present ideas on how to get control over pricing execution, enabling your operation to realize your pricing strategy and related margin objectives.