Fee Phobia
How To Raise Your Fees And Earn What You're Worth
 
OfficePRO magazine, June/July 2002
By Stacy Brice
 

In my last Virtual Office column, I wrote:

"The average hourly rate for an experienced VA who is a "generalist" will level off at about $65/hour. VAs who are deeply niched will earn far more."

What's surfaced is that VAs seem afraid to raise their fees, and they just can't do it. Here are some of their reasons:

"It's not a good time… 9/11 was difficult for a lot of people." "I haven't raised my rates in two years — I'm not sure I can do it now or how my clients would take it." "I don't think my clients make enough to pay me more. I can't ask them to do that."

Can you hear the fear in those statements? It's certainly understandable. For many VAs, growing businesses and especially raising fees are leaps into unfamiliar territory. Why wouldn't this be scary?

What's interesting, though, is at its core, the fear described isn't about how to deal with fees, it's about being afraid to value their services (and themselves) appropriately.

In her new book, Stand Up for Your Life, Cheryl Richardson writes:

"When you decide to stretch beyond your familiar comfort zone and behave in new, more empowered ways, there's a good chance that you'll emotionally look over your shoulder expecting to hear, 'Who do you think you are?' Challenging the rules that told you to stay in line or not get too big for your britches means exposing yourself to criticism, judgment, and the opinion of others. It is this fear of being exposed that lies at the core of what holds us back from standing in the fullness of who we are."

Who do you think you are? Chances are you're a talented, capable, fabulous VA who creates a vast amount of value for clients. Can you value yourself enough to be ok with some people thinking you're too big for your britches?

Your business is a business. You must make decisions about what's best for it and you, rather than on how your clients will respond to them. Still unsure? Ask yourself whether you care more about yourself or your clients. When you value yourself, it becomes easier to do what's best for you and your business — it's the only course of action that makes sense. And, the first step in realizing your earning potential is simply recognizing that you deserve to realize it fully. If you don't value yourself and your work, no one else will, either.

You'll ultimately be setting initial fees, then raising fees with new clients and existing clients. How do you do it?

As a "newbie" in the virtual world (which you are, regardless of your prior experience as an administrative professional) you need to consider a lower-end rate. I usually suggest $30 - $35/hr. You need to know that you can't make a profit if you charge less than $30/hour. Your fees could be higher, but you don't want them lower (there's an actual formula for figuring this out — if you'd like it, email me and I'll send it to you).

Once set, you'll want to work with clients for several months, gaining experience in how virtual relationships work, and how to get things done in the virtual world. Then, with greater confidence, push the envelope in talking with prospective clients. Instead of quoting $30/hour, you would quote $40/hour. Get more experience, learn additional skills, hone your resources, and a few months later, newer clients get quoted, $45 or $50/hour. In this way, your fees keep pace with the value you create.

Things often feel more complex, however, when it comes to raising fees for existing clients. This is where it may really starts to feel as though you're out of line. Often, the surface fear is that the client won't be ok with the new fee and will leave the relationship. Being afraid of the outcome, however, isn't a good reason to not raise your fees. Remember — if you care most about yourself, there is only one path to follow, and that's doing what's best for you. Earning what you're worth is what's best for you. Settling for less is never a terrific strategy.

Before you begin, think. You wouldn't want to raise you fee from $30 to $50, but you might go to $35 or even $40. What makes the difference is how much you've grown, and how much more you bring to the relationship as a result. Every single thing you learn makes you stronger and more valuable to all of your clients.

You also have to believe you deserve more money, and be ready to take this step without regard to what the client might choose to do. If you aren't ready to hear a "no," do the hard work of getting ready before you raise the subject. If you raise your fees but back off when a client doesn't like it, you've killed equality in the relationship.

Consider letting clients know your new fees via email with a message that says something like: "I wanted to let you know that effective September 1, my rate will be $40 per hour. I look forward to continuing our wonderful partnership!"

There are two key elements in that message. First, you've behaved as if your client will have no problem with your new fee. Chances are if you don't have a problem with it, neither will your client. Second, you've chosen a starting date for the new rate at some period in the future; 60 days seems to be quite fair.

In the absence of hearing to the contrary, you're done. Your fees have been raised, and you've lived to tell the tale. More importantly, you've learned that you can value your services highly and find that other people do, too. This experience will make you better able to do it the next time.

But what if a client won't pay your new fee? While it's hard to hear that "no," and you would clearly rather continue in the relationship, a client who doesn't value your contribution needs to go. When you fill your practice with clients who don't fit, you won't have room for those who do. Let those go who don't see your value. You'll find better clients, who will happily pay you more.

Lest I sound mercenary, let me say that none of this is actually about money. It's about valuing your services and working with clients who clearly see that value. You deserve that. Your business growth depends on it. By honoring yourself and your services with appropriate fees you'll be a stronger you, with a far more successful and profitable business. And isn't that a big part of why you became a VA to begin with? 

Stacy Brice is a naturally recognized expert on "virtual assistance" and president of AssistU, an organization that trains and coaches virtual assistants. Reach her at stacy@assistu.com.

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