Super Agent

Overcoming Fees Fears

Even when producers or agency owners recognize the value that they bring to their client relationships, they are often reluctant to put a price tag on that value. According to Alan Weiss, “the toughest part of this sale is to yourself, not the buyer.” Once you’ve established your value with a buyer, offering fee-based services can be an excellent way to generate new forms of revenue and establish a relationship with a client that is based on shared success.

So, why are agencies and producers often hesitant to charge value-based fees? And, how can you overcome your hesitancy?

1) Competition. We often hear producers and agency owners say, “My competition is doing it for free, so I have to.” This is a dangerous thought process that can weaken an agencies value and brand and decrease profitability. To avoid this, be sure that you are clear on how your capabilities are going to improve outcomes for prospects. Understanding the advantages of the prospect will help you stop worrying. 

2) Negative industry behaviors of the past. Free “value-added” services have been lethal for the profitability of many agencies, and can result in a decrease of client appreciation. When services are offered for free, clients will undervalue agency resources which will, in turn, be depleted in the process of implementing strategies that have not been linked to the needs and goals of the client.

3) Fear. Most producers understand the concept of charging for value, but they are often afraid of overcharging or under-delivering. It is important for producers to change the way they think about fees. In his book, Value Based Fees, Weiss explains that fees “are not a ‘necessary evil’ nor a ‘dirty part of the job’, but rather a wonderful and appropriate exchange for the superb value you are delivering to the client.”

The secret to effective implementation: Believe in your own value, establish your value with the prospect, focus on prospect/client goals and outcomes, and understand that the product is mutual success.

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