In The Trenches with Tom Morkes provides behind-the-scenes look into the life and work of entrepreneurs, writers, artists, warriors, and leaders.
Episodes
Monday Nov 11, 2019
Monday Nov 11, 2019
Jonathan Stark is a former software developer who is on a mission to rid the world of hourly billing. He is the author of Hourly Billing is Nuts, the host of Ditching Hourly and writes a daily newsletter on pricing for independent professionals.
During today’s conversation, Jonathan breaks down the idea of ditching hourly rates and why you should think about shifting more towards the less limiting avenue of value pricing. My big takeaway from today’s conversation was that if you are selling services professionally, hourly billing is probably not the way to go. It limits your upside profit potential and it can also harm relationships with longer term clients.
In this broadcast, Jonathan and I talk about:
- How did Jonathan venture into this space
- What are the issues with hourly billing
- In what ways could hourly billing seem like a trap
- How does switching from hourly billing increase efficiency
- What are the benefits of selling outcomes vs selling time/hours
- What are the issues of trust with buyer and seller in relation to time and cost
- What is the importance of discussing desired outcomes with buyer to minimize wasted time
- What are the negatives of a buyer hiring someone on a project basis
- The benefits of offering a guarantee
- How does value pricing work
- What is the difference between value pricing and tiered pricing
- How to create incremental options
- What is the process when booking a client
- Why does Jonathan call the meetings an “interview”
How to Connect with Jonathan:
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