You want to know the fastest strategy to scale your advice firm?
Increase your fees.
It’s so blindingly obvious to me, and kind of ironic that with so many firms seeking to use what they’ve already got to make more, the answer is often sitting right in front of them.
I have developed this super power through the years of being able to build a practice fee model in 90 mins (with the aid of my trusty tool feemodeler.com.au).
Sometimes it’s a great 90 mins full of light bulbs going off all over the place, but it’s not worth diddly until it’s implemented.
And that’s where the questions start, “…I can’t do this for all clients though, right?” “I’m not sure my clients will go for it…”
“Let me think about it. I’ll just need to check those numbers”
Ok. Let’s play numbers.
How fee sensitive do you think your clients are?
If you increased your fees by 5%, how many clients would leave you?
How about 10%? How many extra would choose to go?
What if you did 20% across the board?
How about if it was 30%?
(BTW, if you’re listening to this thinking, “I do asset based/ commissions…” don’t fall into the trap of thinking working out your cost recovery margins isn’t relevant to you. Trust me, when you don’t decide your price directly, it’s DOUBLY relevant)
Let’s put aside the fee increase vs. clients leaving question for a moment, because there’s an even better question than that. Two actually.
How many would have to leave after an increase for your revenue to drop?
How many would have to leave for your profit to drop?
Get ready to be amazed, because the maths alone will make you realise how powerful this is.
I only wish I could film your face whilst you watch it, the video link is here.Stu PS. If you want the detail underneath this calculation, reply and I’ll share. If you want help from me just email me back at [email protected].
Want a next step?