There’s a message I get in my inbox every month or so.
"Have you ever done a corporate training event? Just got a lead and looking for some tips on how to proceed.”
The emails often start with this general question and quickly turn to pricing.
"Basically I just got contacted by a big company about doing a course onsite, which I've never done before. How do you look at these kinds of deals from a pricing perspective? I have no idea how to go about deciding if this is a $1,000 or $10,000 or even $100,000 service!”
Yet another email about pricing...
“How on earth do I price training their developers for a week?"
Once you’ve achieved some level of expertise and reputation, companies will often come calling. They want you to train their people using your expertise. You have the expertise but you have no idea how to price it. Do you price it low so that you can gain experience? Do you price it high in case you underestimate the amount of effort it will take to create and deliver your workshop? Pricing can also get you straight into imposter syndrome, no matter how much expertise you’ve accumulated.
Here’s how I respond
I don’t have enough information about the situation, your expertise and what the client is looking for to give an accurate estimate. However, I can offer a perspective on how to think about it.
I assume you've done your research to see what others are offering that might be comparable but since this is your first time, you're still unsure how to price this. If you haven't googled around a bit, do that first before reading the rest of this message. Having this information will give you a sense of the landscape.
1. Start with your motivation
It’s tempting to start with what you’re doing and the price but resist that temptation. There are many reasons you might want to offer a private workshop. Get clarity by asking yourself why you want do this training.
Is it to...
- Make money?
- Gain experience as a trainer?
- See if you want to do more training?
- Build credibility?
Knowing your main reason for doing doing a private workshop provides clarity on pricing. So for example, if you want to gain experience as a trainer but haven't done it before, you might choose to go on the lower side of your range. (See more on this below.) But if you making money is your primary goal, then you might want to go higher in your range and be less open to negotiating. You can have more than one goal but be careful — having too many goals can make pricing your course much harder as they compete with each other.
2. Understand the value from your client’s perspective
Here’s a common mistake: using your hourly rate for pricing. The method goes something like this: you estimate the number of hours it will take you to complete, then you multiply this with your hourly rate. Don’t start here. Using your hourly rate will often lead you to price your course too low. Using your hourly (or daily) rate focuses on the fee rather than the value.
Before giving a price, asking you a few questions can help you understand the real value of your work to the client. These questions are best to be asked during your initial meeting. If you’ve already had that meeting, send a follow-up email to your client contact.
- What will be different once your team is trained?
- What will these new skills allow your team to do?
- How will the new skillsets or knowledge support the business?
Thinking about the impact of your expertise will have on the individuals and the companies will help you think about the benefits to the client. For example, if your training makes their team more efficient, that can mean ultimately mean more revenue. Let’s say they increase revenue by $250,000 — your course at $10,000 or $50,000 would be a wise investment.
Thinking from a value-based perspective helps you focus on the impact you’ll and ensures you don’t price yourself too low. A great book on this topic is Value-Based Fees: How to Charge - and Get - What You're Worth.
3. Consider the context
Now that you understand the real value of your work to the client’s business, it’s time to consider more tangible factors. Things you might want to consider are: industry, type of company, type of training, the local area and how you got the lead.
Obviously, a non-profit will have a much lower budget than a company in the financial services or technology. Technical trainers can often charge a higher premium than someone who offers training in other areas like say marketing or even leadership. Take into account the local area. If you live in a big, expensive city, the prices are going to be higher than if you live in a small town or suburban area. If the training is in another country, be sure to think about currency differences. Finally, consider the origin of this lead. Since they came to you, there’s a good chance the company is doing well and they have a training budget so they won't expect to pay rock bottom price. Also, if you have an existing relationship with them or someone who knows them, this bodes well.
4. Let’s start pricing
Now that you know why you want to do something, you understand the value to the client and you’ve thought about the context let's add you into this equation to set the price for your course.
- Start with the lowest price you'd do the training for. I call this the resentment number. It's a number at which you'd feel like the work wasn't worth your time. Hence, resentment. Never price below this number. If a prospect tries to negotiate the work to this number, stand firm. If you can’t resolve it and the client won’t negotiate, walk away.
- Now think about a number that would make you really happy. This isn't "I'm going to be a millionaire" kind of happy. It's more like you’d be really content. This number is your ideal number.
- With your range set, (resentment) to (ideal) number - now you can think about the right number, again keeping in mind your goal for booking this work. A tip for finding this number: It's often the amount that makes you feel slightly uncomfortable but you can still say without feeling like you're going to throw up. If this is your first time doing this training, you might want to go somewhere in the middle or to the low end - again, depending on the main reason for wanting to book this.
Hopefully by now you’ve a number in mind or at least a range. Let me know how your course goes!
There are affiliate links on this site, which means that I earn a small commission if you purchase a book but it comes at no cost to you.