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Is Value Pricing the Way of the Future? We Asked and You Said Yes!
by Andreas Noodt, Member, IFAC SMP Committee | July 25, 2014 | 2
Back in early June we published a 3-part series of articles, “Pricing on Purpose: How to Implement Value Pricing in Your Firm.” Authored by Ron Baker, founder of the Verasage Institute and one of the foremost advocates of Value Pricing, the articles describe this new and fast emerging approach to pricing and explain how to get started.
When we launched the series we noted that Value Pricing, which primarily but not exclusively sets prices on the value to the client rather than on the cost of the service or historical prices, was catching on in certain markets. For example, in the US increasing numbers of accounting practices are adopting Value Pricing over billing by the hour—both to better align their and their client’s interests and to avoid commoditizing their services. But we were keen to see whether you thought it had more universal appeal so we posed the question: Do you think that Value Pricing will be the pricing strategy of the future?
The results are in! You reported a resounding yes—77% of respondents said it was likely or very likely that Value Pricing would be the pricing strategy of the future. While the results may not be globally representative, they indicate Value Pricing's growing popularity. We hope that you will find the articles, which are based on Ron’s sixth and latest best-selling book, Implementing Value Pricing: A Radical Business Model for Professional Firms (John Wiley & Sons, Inc.), helpful as you implement Value Pricing.
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