I’m Victoria Tretis, and this is the podcast for ambitious and driven Virtual Assistants who want to move into the Online Business Manager role. If you’re ready to take action today, head over to the show notes and download my free guide ‘Five steps to go from VA to OBM’.
Now for the main part of the show.
Hello, I hope that you are good and that you’re having a really, really good week. I can’t believe we’re nearly at the end of September this year is flying by.
So today I promised you an episode on three ways that you can move away from trading time for money because I am sure as a Virtual Assistant, you are probably charging by the hour. So that could be a pay as you go rate, or you might offer retainers bookings; you may even have some kind of discount scheme going on where a client might buy a block of hours and then you give them like two hours free or something. But the problem with all of that is trading time for money and hourly rates means that you are always going to be limiting your earning potential based on the number of hours that you can physically work. I want to dig into three different ways that you can price OBM services so that you can potentially earn more as well, to be honest with you.
So, let’s have a look at these. The first one is a package. This is where you’ve got a fixed project or a fixed scope, so there’s a defined outcome of you working on this project and you’ve agreed a price in advance. It doesn’t matter how long it takes you, the client is paying for the delivery and that outcome. To give you an example here, I have a content manager who works on a package basis. We’ve agreed what the scope is, what that role actually involves, and I will pay her that amount, whether it takes two hours or 20 hours, it’s the same. But the point is she’s going to get quicker over time, and she won’t be out of pocket. Obviously, I’m very fair. If I were paying her for two hours, but she was actually doing 20, we would have a conversation about it! But I’m paying for the outcome regardless of time. There’s a specific scope, there’s a fixed price, and it means that the more efficient she gets, the more money she actually makes.
So next one I want to talk about is value-based pricing, so this is pricing based on the transformation that the client gets. You’ve probably seen all these power hours that people are doing, and this is a really good example. So, let’s say you see a seventy-nine pounds power hour, or a ninety-nine pounds power hour. This is a tongue twister! Or even more.
Now, that amount might not be the typical hourly rate for that person, so. Ninety-nine pounds an hour might not be your usual client work rate, but the power hour is priced based on the knowledge you’re giving to the person you’re speaking with to fast track their transformation. So, for instance, I’ve paid for power hours to help me with a social media strategy so that I don’t make mistakes, I’m learning from somebody’s expertise and I’m happy to pay for that so that I don’t do something wrong. Like, I’m paying for their expertise to fast track me. I’ve also done power hours to help me with my weight because I’ve been a bit of a yo-yo-dieter in the past and I want to try and lay that to rest. So, I’ve paid for that as well. I’m paying for somebody’s expertise because I believe that they can give me the transformation that I need.
And another example would be I’m in a mastermind. The price doesn’t reflect the amount of time the group owner spends with me. The price reflects how much knowledge the group owner and other people within the group have that can help move my business forward. So that’s value-based pricing.
The last one I’d like to talk about today is incentive-based pricing. So this is where you’re working with a client on a regular basis, you’ve really dug into their systems, you really understand how everything works and they’ve got a new product that they’re launching or a new thing that they’re launching.
So what you can agree in advance is to have a base pay and then also receive a sales commission based on the number of sales that that launch sees. I’m not saying that this is a commission only. You’re already getting the base pay, but on top of your base pay, you’re getting a bit of a bonus tied into the launch and sales of this new product. So this may mean that you need to work a few extra hours, you may need to be on call on the day of the launch and if that’s the Saturday, that might mean working Saturday to iron out any last-minute niggles or details or everything or anything. But it gives you a greater earning potential and it gives you that motivational factor as well because it’s incentivising how you’re working as well. This works really well if the client is launching a say, digital product. So that’s got that scalability with it, they’re not having to physically type every digital product out, it’s a one to many style product.
To recap the three different pricing structures that you may be able to deploy in your business.
We’ve got packages or projects. We’ve got value-based pricing, and we’ve also got incentive-based pricing as well.
Now, in next week’s episode, I’m talking about whether you can offer both VA and OBM services on the same website or on the same social media profile.
So, tune in to next week’s episode to learn all about that.
Thank you so much. Have a good week.