The No BS Profitable Pricing Model
Pricing.
It’s a minefield for agency owners, and usually involves spreadsheets, scribbles on scraps of paper, rate sheets that you’ve edited a dozen times, and after all that, you’re still clueless.
As I was suffering with this too, I came up with a profitable pricing model that really worked when I was struggling in my agency, and turn things around so fast that I’ve never looked back.
Want me to share it with you?
The best profitable pricing model I’ve used
Say you want to make $35,000 a month in revenue.
You know that 50% of that month will be spent on delivering client projects, which leaves the other 50% for marketing and then the sales calls, admin and onboarding.
So, in any given month, you only have 50% of the time (or 10 working days, if we exclude the weekends) to bring in $35,000.
That really focuses down the time you have to have those sales calls and close those clients.
Given that you only have that limited time, you’ll have to make some decisions so you meet that goal.
You’ll need to prioritize going after only those warm prospects where you have a high probability of closing, and hanging out in places (on- or offline) where you know you’re going to meet more of your ideal clients.
You may even want to ramp up your referral game, by simply asking your best clients for recommendations.
That’s the marketing piece.
What about the sales and pricing?
If you’ve only got a limited time to make your sale, the price has to be high enough to match that.
Going back to our example, if you predict that you could make 1-2 sales a month, and your goal is $35,000/mo, then your project price has to be at least $17,500, or even the full $35,000.
Now it’s time for a gut check.
Can you realistically sell a service at that price?
If it’s no-brainer, that’s great. You now know how you need to be spending 50% of your time each month.
If you think you’d struggle, then you’ve got a few options:
Lower your monthly target, so that you can make offers you know you can confidently sell.
Adjust your 50-25-25 time allocation, so you are spending more time on the marketing and business development if you need more time to make a sale.
And that’s all there is to it.
In my Program, I break this down in a lot more detail, and my students get a tricked out spreadsheet where you plug in your key numbers of your offers, monthly revenue goals, annual revenue goals etc. and it spits out how many offers you need to sell, over how long etc.
Then you just play around with those until you get a combination that works for your agency.
It’s beautifully simple - I love it!
Grow a sustainable business MACHINE
Once you’ve got the 50-25-25 model into your agency, you’re going to need a way to keep your agency building profits.
That’s what I call building a sustainable business machine - somethat that reliably, predictably keeps going so you can scale up.
The other bonus is that your business keeps generating leads and revenue in a way that doesn’t burn you out, and lets you take much needed vacation time with your family and friends, and have time to go after any other creative interests that you love to do.
And you can even build a lifestyle that lets you work from anywhere, if that’s what you want!
Here’s how to get the machine going.
In all parts of your business - whether it’s delivering the client work, onboarding new clients, offboarding clients coming to an end, marketing and sales, you need to identify where your strengths are, and where you’re weak, and really should delegate to someone else.
Once you’ve got that clear, work out what you want to outsource, and how much that would cost v. the benefit of that for your agency.
Then, do the math to work out what, if any, changes you need to make to your pricing, so that you hit your profit goals, and cover all the expenses, including the outsourcing of anything you’re really weak at.
Rinse and repeat every 6 months, so that you’re ongoingly keeping on top of the highest priority and highest value tasks, and offloading anything that is low value or important but can be done much more efficiently by someone else.
This is something I regularly do in my agency, and I show my students the power of having this set up in their agencies.
It takes you out of the trap of burnout, as you stop doing ALL the things, so when you’re closing clients into your projects, you know that you’re only ever going to deliver the best quality, which in turn leads to great testimonials and more great clients.
It’s also a clear path to scaling, and bringing on more people to your agency, if that’s what you want. I’m all about scaling without employees - running payroll is no fun, trust me. But you can expand your team of outsourced people, and keeping track of where your highest value tasks are will help you see where the gaps are, and where you need to hire in talent to fill those gaps.
Set boundaries the right way
One of the quickest ways I lost revenue and profits in my branding agency was when I didn’t have any boundaries in place.
Correction. I HAD boundaries, and then I never stuck to them.
Which is basically the same as not having any.
I would end up working round the clock on client projects, and since they would drag on for weeks and months, that pace never let up.
When I went on vacation, my laptop was always there, and I was always sneaking away to check on it to keep up with the latest thing my client needed.
Fast forward to now, where I’ll only take on projects that I know I can start and finish in a given time, and that allow me the time I need with my students, with my family, my son and all the other great things I do in my life.
No more burnout, no more crappy boundaries.
So how did I get here?
After I started selling only Brandshrink™ and Brandup™ as my design packages, it was really clear to me what I could and couldn’t get done in any given week or month.
Since my clients loved this way of working, and I knew I wanted to do more of it, I decided that my branding agency just has to operate this way - like drawing a line in the sand.
Did I still get prospects wanting me to do things the old way?
Of course! In those cases, I would politely decline, and then I would gladly refer them to any of my branding agency colleagues who still operated on the traditional model.
And really, it was no loss to me or our agency.
By knowing I had a finite start and end time for each project I worked on, I had time freed up to go and nurture relationships with my ideal clients - people who had been on my radar for a while, but we’d never sealed the deal.
So I knew that every time I said no to a project or prospect that didn’t fit with the boundaries I had set up, I wouldn’t be saying no revenue.
In fact, I was saying no to the headaches and hassle of negotiating rates, start times, end times, extras etc. - the other branding agencies were welcome to that!
The other great thing that reinforced my boundaries, was the level of work I was turning out for my clients.
I was able to be more present and focused by literally clearing the slate of anything that wasn’t their project for a few days every month, and they always got my best work.
Even I surprised myself!
So I knew that if I wanted to keep this up, I couldn’t go back to how things were before.
I started to build a reputation for having an amazing branding agency that delivered high quality, corporate-agency-level work in a small, boutique business, in record time.
And as I started to get out there in the media (Google my name + Forbes or TEDx and you’ll see what I mean), keeping my boundaries in check became even more critical.
I REALLY couldn’t take just anyone who wanted branding - I had a strong reputation that I would need to nurture and protect, so I could really be that industry leader my peers were saying I was.
In other words, getting clear on my boundaries, and protecting them, was an ongoing process that I kept improving over time.
Each time something happened that would require me to keep my boundaries intact, I made the adjustments I needed to.
And I still have to, even though the foundation for setting those boundaries comes from a place of being able to make a big impact with other branding agency owners in the world, not just keeping the lights on.
And this is probably what it’s going to look like for you too.
Maybe start small by saying no that 5th revision, when you’ve only agreed to 3.
Maybe don’t go to that networking event that you’ve had to get up super early for, and you never get any business from, and just stay in bed and give your body some much needed rest.
Over time, it’ll get easier and easier, and clearer and to stick to a schedule that lets you set prices that build your profits, and give you all the time off you need to enjoy your life!
Here’s what you need to get…
Figuring out the right pricing strategy for your agency is key to long-term growth and profits.
The No BS 50-25-25 Formula is a great tool to implement, and keeps you on track financially. It’s also the key to ensuring that when you never fall into the trap of drying up your pipeline when you’re busy on client projects
Alongside a great pricing strategy is learning to set boundaries around your schedule, so you can keep being your best self for your clients and for everyone else around you, and enjoy the financial freedom that comes with running your own branding agency.
P.S. You can always jump on a call with my team if you want to dive deep into my Profitable Pricing Model and all my other tools and strategies to scale up your agency - just go here to get started!