Who’s time is being devalued anyway?
The topic of charging fees comes up in travel agent forums on a regular basis, and this week was no different. In the most recent discussion, some of the travel agents complained about how clients don’t value our time, which leads to their resistance to paying fees.
They are wrong.
I do not think it is our time that clients devalue. I believe it is their time that they do not value. Some of my clients balk at paying fees, while others whip out the checkbook without blinking an eye. And I’ve even had a few clients tell me over the years that I’m not charging enough. When I look at some of these clients specifically, what sets them apart?
The ones that have chastised me for charging too little include two CPAs, an architect, and an attorney. All professionals that charge fees themselves, but also professionals that do not make any types of commissions on the backend. My clients that have readily paid fees without balking have included doctors, financial planners, and business owners. One financial planner and I have talked extensively about the practice of charging fees. He charges fees for his services, even though he does make commissions on certain products that he sells. But like travel professionals, he knows clients can take his advice and use it to invest elsewhere. So he charges upfront fees. He never waives them (not even for me!), and he doesn’t apply those fees to anything. But he’s also more willing to provide clients the products that don’t pay him in any manner, because he’s working for his clients, not his own pocketbook.
So when you are marketing for new clients, or get a new referral, how can you assess in advance if this is a client that will pay a fee or run in the opposite direction? Before you sell yourself, you don’t want to hit them with “Are you willing to pay my fee?” The answer will likely be “no.” They have to know what they’re getting for that fee. You have to sell them on why you are worth whatever fee you charge.
If you are having a casual conversation with a new potential client, or telling your network group what the ideal referral looks like, ask questions like these:
- Do they use a CPA for tax preparation that they can recommend? They’ll either refer you to their CPA, or tell you that they happily do their own taxes.
- Do they have a landscaper or gardener that they can personally recommend?
- Can they recommend a good housekeeper or cleaning service?
- Where do they go to detail their cars?
- If they are a business owner, ask them who they use for website design, graphic art, marketing, etc.
The answers you get will be telling. If someone values their own time, they’ll be more likely to hire someone else to clean the house, pull the weeds, detail the car, do their taxes, etc. One of the CPAs that told me I don’t charge enough explained why he was willing to pay someone else to do his vacation planning. He estimated that it would take him a minimum of 10 hours to do the Internet research to figure out where to go, how to get there, where to stay, what to do once he was there, etc. He knew how many tax returns he could complete in that same 10 hour period, and based on that he calculated what his time was worth to him. Paying my fee saved him time, which in turn saved him money (or made him money, depending on how you looked at it).
Whether you already charge fees, or are thinking about implementing fees, don’t get discouraged when someone won’t pay your fee. They aren’t saying you aren’t worth it; they are saying their time isn’t worth it. They have nothing better to do with their time, so they’ll spend it surfing the web looking for that next $199 five-night air included all-inclusive “deal.”
Susan Schaefer is the owner of Ships ‘N’ Trips Travel located in Tennessee, and specializes in leisure travel with a focus on group travel and charity fundraisers. Through their division Kick Butt Vacations, she focuses on travel for 18 to 23-year-olds. Susan can be reached by email at email@example.com or by phone at (888) 221-1209.