Value-Based Pricing And Charging As Much As The Market Will Bear - Kitces & Carl Ep 202
Michael Kitces • 2 days ago
What This Video Is About
The conversation between Michael and Carl explores the value of time and pricing strategies for advisors, delving into the ethics of charging higher rates and the importance of building goodwill in business relationships.
Major Ideas Discussed
- The value of time is a critical consideration for advisors, with some arguing that it's unethical to charge more than their initial value, while others believe the market dictates the price.
- There is a spectrum of acceptable pricing, with different industries having varying levels of flexibility, such as healthcare and utilities having stricter regulations, while luxury goods have more flexibility.
- Building goodwill into a business can be beneficial for long-term client relationships and trust, with Carl sharing his personal preference for maximizing impact rather than profit.
- Capacity and client relationships are essential factors in determining pricing strategies, with advisors needing to manage their client load and prioritize providing value to their existing clients.
- Morality and ethics in pricing are complex issues that require careful consideration and transparency, with Carl cautioning against making blanket statements about what is morally acceptable.
What to Watch Next
Advisors should consider their own values, business model, and client needs when determining their pricing strategies, and be aware of the importance of transparency, legality, and client willingness to pay.