Price formation of the konsaltingovykh services
Estimation of consalting

Mikhail Ivanov, Mikhail ferber.
Fragment from the book "management on marketing of konsaltingovykh services"
Free councils frequently bypass too dearly.
Unknown author

After being introduced to this chapter, you will obtain information about principles and methods of the formation of the cost of konsaltingovykh services. You learn, why it is worth avoiding "round" numbers with the designation of price and as selecting the correct tactics of the negotiations about the cost of your work, why low price elasticity and for what reasons to you ever it cannot be dempingovat' on the market for some types of konsaltingovykh services.

By however known there was your company and no matter how were necessary to client your services, if you establish on them incorrect price, you will lose order. If you name too great a number, which, in the opinion of client, will exceed the benefits obtained by it and exceed the scope of his budget, you will not obtain contract. But if in client impression is formed, that the fee declared by you is too low, and therefore he speaks about the absence in you of sufficient knowledge and professionalism, then contract also not will be obtained.

You should always remember that the adequacy of one or other price or another is determined not by you, but by your client. You also must clearly understand that the fact that you sell not the active memberships, which in the case of failure can be resold, but something intangible: its knowledge and experience, which are expressed in the promise to solve the problem of client. This fact has one additional important consequence: never begin work without obtaining of preliminary payment, since you sell the irreplaceable service life, namely - your time.

It is necessary to especially thoroughly approach the price formation still and because not one konsaltingovaya company can conduct the unlimited quantity of projects simultaneously. If you undertake project, then this means that, until you bring it to the end, you will not be able to take new. Therefore the first priority task of marketologov konsaltingovykh companies is the maintenance of optimally high prices. As shows analysis, an increase in the price has clout on the profitableness of company, than an increase in the volumes of sales or an increase in the portion of rynkay.

For establishing the optimum prices it is necessary to forego the traditional expensive approach, with which to the prime cost additional expenses and rate of profit are added, after which final price is established. Correct approach provides for collection and data analysis about nature of the interrelations of price and demand, prices of competitors and cost behavior in the long-term period. Simply stated, be focused not on your expenses, but on the value and the benefits, obtained by client.

Never you hurry to call the cost of project with the first encounter. For the designation of optimum price to you necessarily in more detail to become acquainted with your client, with the problems, which one must solve, with the periods, which will be required for fulfilling the work. You should correlate the time, which will be spent on the project, with the current load of your consultants. Only after attentive acquaintance with all facts propose final price, leaving to itself possibility for the retreat, since practically always in the process of negotiations clients deal, and this is normal. However, under no circumstances you must not reduce price more than of 40% of the initial. In this case any price change must be substantiated, for example: your work will cost to 10% less, but in this case the colleagues of client will participate in the collection of information on your task.

If your form of konsaltinga allows the partition of service into the individual parts with obtaining of intermediate results, you can use this with the trade. If you see that the client is not ready to pay total price for entire complex of services, you will divide your work and fee into the stages, after leaving to client the possibility of "output" from the project after the completion of each of the stages. After carrying out the part of the works and after recommending itself from the positive side, you will be able to obtain orders also for the remained services.

Avoid "round" numbers with the designation of price. Meeting such numbers, client always suspects, that the rounding occurred not into his benefit. Our practice shows: the less the "round" price, the client to it relates greater the confidence with which.

Price elasticity on the market is low in view of the specific character of nature of konsaltingovykh services. This occurs for a number of reasons.
Buyers do not possess full weight of information about the services and the prices. To clients it is sufficiently difficult to carry out the comparative analysis of the market for konsaltingovykh services. In contrast to the standard methods, accepted by the commodity markets, here it is not possible to produce control purchases, to analyze models, etc.
The cost of switching to another consultant is high. To client, who already once paid for that so that the consultant would be introduced to his business, and also to granted to him confidential documents, it is difficult to change him by other consultants.
The risk of the purchase of poor quality service is very great. This is connected with the lack of development of market and the specific character of services.
The purposeful segment of users considers that the stamp is characterized by the high gross value addition, which profitably distinguishes it from the goods- competitors.

Price elasticity inside the segment usually is considerably higher than between different segments. This means that the competition between PwC and KPMG can be price, and between KPMG and by the average Russian auditorial of companies - cannot. If PwC will lower prices of the services, then it will rather draw clients from the average segment, than will be obtained clients KPMG. and vice versa, if BKG Profit Technology raises price of the services to level BCG, then it will not obtain clients from the highest segment, but, it is faster, it will lose its. It is possible to draw users of the low segment to the acquisition of more qualitative services by reduction in the prices, but not vice versa.

For the substantiation of the cost of operation some konsaltingovye firms use the artificially designed coefficients, which connect expenditures for konsalting and profit, obtained by client from their work.

Index of the success of projects. With the negotiations about the cost of operation you can use an "index of the success of projects". This artificially calculated by you index is equal to the ratio of the value of a yearly increase in the actions of your company- clients to the index of an increase in the fund market. For example, if index RTS grew since the beginning of the year by 25%, and the summary index of the actions of companies - your clients - to 50%, then the "index of success" was equal to two. This index indicates that you work only with the first-class companies and your work is of the perceptible benefit. If the actions of your clients do not quote on the fund market, it is possible to use data about an increase in the volume of production with respect to the growth OF VLADIMIR PUTIN. Is given below an example of use Bain&.Company of this index (see Fig. 16)1.

Ris.y'

Never attempt to dempingovat'. In this case you will lose face in the professional association, you will obtain the brand of "cheap consultant" and forever you will remain with the low prices. Reduction in the prices will not bring to you new clients, but it will move you into the cheaper segment. Furthermore, low prices can frighten away serious clients, since price is often the prompt, which speaks about the quality of service. To you in no case it is not possible to make any reductions. Clients can perceive this as consequence of worsening in the quality of service.

Forms of the establishment of prices of the services

A question about the forms of the establishment of fees for the konsaltingovye services is examined in many studies; therefore we only briefly will pause at the description of basic approaches. In the world practice are accepted four basic forms of the establishment of price of the konsaltingovye services:

Hourly wage. The cost of the man-hour of the consultants of different qualification and the approximate volume of works immediately is specified with the hourly wage. It is psychologically difficult to pay to many clients on $50-100 per hour of the work of specialist; therefore most frequently hourly fee adapts, when the work on the project occupies several weeks. Usually clients do not agree to this form of payment with the more prolonged project, preferring to establish the fixed payment. Moreover, to clients it is difficult to control, are how much hour you actually they spent on project, which practically always creates tension.
By the way. Never attempt to take money from the clients as the work, during which you, becoming acquainted with the problems of enterprise, attempt to sell your services. This is direct method to the loss of order.

Fixed payment for the project.

In the practice of konsaltinga increasingly more frequently is used precisely this method of establishing the cost of operation, with which the cost of project is specified immediately. Many important companies, which traditionally used an hourly wage, pass to the fixed form of payment. This helps clients, and to consultants to check their budgets. However, this form of payment is unacceptable if the results of project greater depend on client, than from the competitor, for example in the case with the restructuring of enterprise.

Payment as percentage of result. Sometimes clients propose to consultants the form of payment, which depends on the result of the realization of project, for example as percentage of the obtained profit. Theoretically this form of payment is ideal, however, the authors consider that in the majority of the cases this form of payment must be slanted by consultants for the following reasons:
they pay to you for the council, but responsibility for his realization completely lies on the client, but not on the consultant;
in order to determine, client obtained profit or loss, the independent arbiter, for example auditor was necessary for you. Naym of the independent auditor will require time, and money. Under the contemporary Russian conditions, with the dual calculation, to set, did obtain the client profit or loss, it is generally impossible;
often the councils of consultants make it possible to avoid errors and to avoid incorrect actions. In that case the consultant does not bring profit, but he helps to avoid losses, which is not less important. However, in this case almost it is not possible to quantitatively estimate the contribution of consultant;
effect from the work of consultant can be obtained only after a certain time, during which its work remains unpaid;
before beginning project practically it is not possible to sufficiently accurately quantitatively estimate the value of future profit or another benefit of client.

Kombinirovannaya form of payment.

Under the Russian conditions often is used the kombinirovannaya form of the payment, when, for example, consultant obtains the guaranteed base payment and reward for the result.

Despite the fact that important companies with the payment of their services always adhered to policy only "available", market changes and dictates its rules. At the heighth of the technological boom of the end of the 90th is annual McKinsey it neglected the program of "service in exchange for the action", within the framework of which it assumed on account of the payment of its work of the action of clients from highly technological branches. Thus company destroyed one of the basic principles of konsaltinga - independence from the client, i.e. the rule of objectivity. Sufficiently soon this program was convoluted. It is possible to say that company A.D. Little ruined in 2001 after unsuccessful investment in the action of technological companies - its clients.