How to Price Your Work
Value-based pricing and the discovery process that makes it possible.
One of the first questions people ask when starting a consulting practice is: “What should I charge?”
It’s the wrong question. The better question is: “What is my work worth to this specific client?”
Don’t Compete on Price
When thinking about pricing, your goal is to avoid easy comparison to other options. If clients can line you up against five other consultants and compare hourly rates, you’ve already lost. Someone will always be cheaper. If you’re based in the US and not running an AI-powered operation, you will not win a price war.
Instead, compete on quality. On accuracy. On client experience. On customization. On fit. On the specific value you deliver.
Don’t Sell Your Time
The most common pricing model is time and materials. You estimate hours, multiply by your rate, and send a quote. It’s simple. It’s also the lowest common denominator.
Selling time makes you a commodity. It invites clients to comparison shop. It focuses the conversation on cost rather than value. And it caps your upside: if you get faster and more efficient, you earn less.
This doesn’t mean you shouldn’t know how much time something takes. You need that to understand your margins. But it shouldn’t be how you sell.
Sell the Value Instead
Value-based pricing focuses on what your work is worth to the client, not what it costs you to deliver. Money saved. Money gained. Risk avoided. Opportunities captured.
If your engagement helps a client avoid $500K in support costs, or accelerates a product launch that generates $2M in new revenue, the value of your work isn’t measured in hours. It’s measured in outcomes.
This is easier said than done. To price based on value, you need to actually understand the value. That requires a real discovery process.
Price the Client, Not the Work
Here’s something that took me years to fully understand: the same work can be worth very different amounts to different clients.
An enterprise company and a Series A startup might both need help with the same type of problem. The deliverables might look similar. The process might be identical. But the value is completely different.
Enterprise clients have more on the line. The upside of getting it right is larger. The downside of getting it wrong is more severe. A product launch at a Fortune 500 company might represent $50M in revenue. The same type of launch at a startup might represent $500K. Your work isn’t worth the same in both cases.
Enterprise clients face more complexity. More stakeholders. More regulatory requirements. More technical integration. More organizational politics to navigate. Your work has to account for all of this.
Enterprise clients have more budget. This isn’t about gouging. It’s about alignment. A $200K engagement that delivers $5M in value is a bargain for an enterprise client. That same $200K might be impossible for a startup, even if the work would be valuable to them.
This doesn’t mean you can’t work with smaller clients. It means you should think carefully about how you price different types of engagements. You might offer a lighter version of your service to smaller companies at a lower price point. Or you might focus exclusively on enterprise clients who can afford your full offering.
The point is: don’t set a single price for your work as if it exists in a vacuum. The value depends on who’s buying.
Discovery is the Foundation
Consulting engagements are often “complex sales.” You can’t just send a quote. You need to understand the prospect’s situation, goals, constraints, and context. Often over multiple conversations. With multiple stakeholders.
This takes time, but it’s not wasted effort. Discovery is where you learn what the work is actually worth to them. It’s where value-based pricing becomes possible.
If you can, consider offering a paid diagnostic engagement. This is a short, scoped project where you’re paid to deeply understand a client’s problem and recommend a solution. Examples include:
A design audit that assesses their current product experience
A process review that identifies bottlenecks and inefficiencies
A strategy sprint that defines priorities and a roadmap
A technical assessment that evaluates their infrastructure
Diagnostics let you get paid to do discovery. They also establish your expertise and often lead to larger engagements.
The Questions That Uncover Value
I’m not a professional salesperson, but I’ve sold a lot of consulting engagements over 20 years.
The approach that resonates most with me comes from a book called Let’s Get Real or Let’s Not Play by Mahan Khalsa. It’s a weird title, but the methodology is logical and works well for value-based pricing.
Here are the questions I use, most adapted from that book:
Understanding the problem
What are all the issues you need help resolving? Get everything on the table. Ask “why” multiple times to get to root causes. Confirm you’ve captured all the issues. Ask them to prioritize.
How do you know these are problems worth addressing? Begin to understand the impact. Connect their problem to larger business measures.
What is the impact on the business of not addressing these issues? Try to get specific. Would support costs increase? Would customer satisfaction drop? Would churn go up? Put dollars to it if you can. These numbers will later justify your fee.
What would the payoff be if success is achieved? Sometimes this is the inverse of the pain. Sometimes it’s new opportunities: increased market share, fewer heads needed, annual savings of $X. This is the value you’re pricing against.
Understanding the context
Who else is affected by this? Who else benefits from the solution or is harmed by the status quo? These people may help make the case for funding. Also identify hidden stakeholders who need to accept any solution you propose.
How does this fit into the big picture? Are there company goals or OKRs this aligns with? Executive initiatives? A conference or press event this needs to support? Connecting to larger priorities helps justify investment.
What has stopped you from addressing this in the past? This uncovers gaps in expertise (which you might fill), timing issues, lack of alignment, political challenges, or simply that the pain wasn’t acute until now.
Understanding the buying process
What investment feels appropriate? It’s uncomfortable to talk about money, but you have to. Sometimes clients have a fixed budget. Sometimes they need to make the case for it. Remind them of the cost of inaction and the payoff of success.
What kind of internal resources can you bring to bear? You’ll likely work with client stakeholders. Identify who their core team will be. The work shouldn’t just be thrown over the wall when you’re done.
What is your time frame for starting? How quickly does the sales process need to move? Are there external deadlines driving urgency?
Along with yourself, who really cares about this decision? Uncover other stakeholders who need to approve any proposal. This might be a VP or executive you haven’t met yet.
Where are you at with evaluating options? A fair question. You’re investing time to develop a proposal. You should know if they already have a preferred partner, if you’re competing against six firms, or if they’re just starting to explore.
What criteria will you use to make your decision? If they tell you, you can address it directly. Is it domain expertise? Cost? Speed? References?
What other options are you considering? Besides other consultants, they may be considering software solutions, an internal effort, or just not tackling it right now.
Where will the money come from? Another uncomfortable question, but important. If budget is pooled from multiple groups, you’ll need to speak to the value for each.
You mentioned a start date. What needs to happen before that? Helps you understand the process. Maybe they need to talk to two more firms. Maybe they need internal alignment first.
What are our next steps? More meetings may be needed. More materials to review. Figure this out before ending your conversation.
What Comes Next
At some point, you’ll have enough information to propose a solution. In the next post, I’ll cover how to structure a proposal, why I always offer three options, and the most important thing most consultants forget: making your buyer successful.
What’s your current approach to pricing? Are you selling time or value? Reply and let me know.
–Greg