Consider this scenario.
I’ve just given advice to a client.
It took me eight hours to complete the work, at £200 an hour. (Totally made-up figures for the purposes of this story!)
Thanks to that advice, my client saved £37,000.
So, how much should I charge?
£1,600 – based on my time?
Or £7,400 – say, 20% of the amount I saved them?
After all, the advice was incredibly valuable. It was worth far more to the client than the hours I put in.
That’s a £5,800 difference to my bottom line — without doing any extra work.
There’s no right or wrong answer here. These are simply two different pricing models. But in my experience, the second one — pricing based on the value you deliver — is significantly under-used by business owners.
Now, this might sound like an issue that applies just to consultants or advisers — but it’s not. Value-based pricing can apply to a wide range of businesses:
- A software company that helps clients eliminate costly inefficiencies
- A manufacturer whose product improves uptime or reduces waste
- A training provider whose course leads to major performance improvements
- A creative agency whose rebrand helps a client win new business
In each case, the value delivered far exceeds the time, materials or inputs used to deliver it.
Yet most business owners still default to cost-based pricing. It’s easier to calculate. Customers expect it. And often, owners aren’t fully sure of the impact they’re having — so they play it safe.
Sometimes, it’s also a confidence issue.
Charging based on value usually means charging more — and that voice creeps in: “Is my work really worth that much?”
But here’s the reality: If your pricing isn’t aligned with the value you deliver, you could be holding your business back.
You might be working harder than necessary for less profit. You might even be undercharging to the point where you’re struggling — especially in today’s inflationary environment, where costs are rising and margins are getting squeezed.
That’s why it’s not just about choosing the right pricing model — it’s about revisiting it regularly. Because what worked last year may not be working now.
If your service delivers meaningful, measurable results to your clients, I urge you to consider whether value-based pricing could be a better fit.
It can lead to a major increase in profit without increasing your workload. It elevates how your service is perceived. And often, it leads to more satisfied clients, because you have the resources to invest more back into what you offer.
So here’s the real question:
Have you ever stopped to truly consider the value you provide?
You may be surprised by the answer — and it might just change the way you price.
That’s where we come in.
At Insight Associates, we help business owners like you gain real clarity on your cost base and the true worth of what you offer. We’ll ask the tough questions, challenge your assumption and help you find the pricing model that makes the most sense for your business, your market and your clients.
Getting your pricing right is one of the most important levers for profitability and sustainable growth — which is what we’re all about.
To find out more, email garry@insightassociates.co.uk or call 01279 647 447 to book a consultation with me or one of our specialists.
Warmly,
Garry
You might also be interested in: Pricing is not a maths problem. It’s a judgement problem – Insight Associates Limited
