Do you set your fees based on your feelings?

This entry is similar to one published in this month’s issue of my e-newsletter: Sales & Marketing Secrets. This is an important topic because, very often, consultants, coaches, and other solo entrepreneurs struggle with how to set their professional fees- many opt for fees which are either too high or too low. When asked about the basis of their fee setting, these professionals will cite all kinds of reasons why they are "worth" the higher fee, or why they are only "worth" the lower fee. Building your fee structure on your feelings is a bad idea, because it’s not solid and can change as often as your feelings do. Better, instead, that you take some logical and clear steps for setting your fee: 1) How much do you need to earn in order to be profitable? (Remember, if it’s not profitable, it’s not a business..) 2) What special skills/experience/knowledge do you bring? 3) Are your rates generally in line with others in your field, OR do you have a clear way of explaining why they are so different? 4) Are you marketing in the right arenas (i.e. among potential customers who can afford your fee?) 5) Do you have a built in plan to give yourself raises every six months or a year? Once you’ve completed each of these steps, you’re very likely to have a fee structure that your market will bear.