Effective Pricing Live: Mastering the Numbers - Understanding Price Calculations and Models

Hey, everybody that I know and everybody else that's here, we're at the top of the hour, so we're going to go ahead and get started. Let me just quickly share my screen.

All right, Can I get a quick drop in the chat? If you guys can see my first slide.

Awesome. Thank you, everybody. Close this window.

Okay, so welcome to session two of this new course that we're doing for effective pricing. If you've heard me talk at all before, you know I get really excited about effective pricing. I'm really happy to be training on this topic. It's one of my favorite things that's really near and dear to the heart of my business and the success that I've had with Mark's program. It really just shot through the roof when I got an understanding of effective pricing and, and how to use it really well. So last month we talked about the introduction to effective pricing and sort of maneuvering your way around the software and the settings menu a bit. Just some foundations and first steps. Today we're going to go on to talk about mastering the numbers, understanding how the price gets calculated, and a little bit of the models. And then in our next session, we're really going to get into a lot more of the specific equations for each type, calculation type, and we'll touch on that in a minute. I'm sure a lot of you may have heard me speak before, so I will just go through my introduction really quickly. I'm in Southern Ontario. I'm a certified professional bookkeeper. And my firm is fairly small. I don't keep a lot of clients, but the clients I do have, we tend to do larger volumes of work for them. So I do have a small team as well, and it keeps us pretty busy. Our firm has been awarded a few awards over the past few years, and I've been a member of Mark's academy. I know we may have some people in the room here that are effective pricing users but aren't members of the academy. But I. I am a member of Mark's academy, so you will maybe hear me mention that a few times today. And also I know different people have different versions of the software, so I apologize if I'm showing anything that's maybe at a level that you don't have access to. And you can always reach out to Sarah on Mark's team. Mind you, she's on vacation right now, so it may take her a little bit to respond. But if you are interested in getting a higher version of the software, if you don't have that you can reach out to her, and she will help you. That I like to call effective pricing and. And what it's done for my business. I. I like to think that, you know, everything that I learned from Mark and all the trainers from all the other sessions is like the gift that I received. And then effective pricing is like the wrapping paper around the outside of it, because it's just so beautiful. If that's not Cordy. Okay, so a little bit of housekeeping.

Oh, before I get into the housekeeping, actually, I showed this slide last time. I went into a lot of detail with it. I'll probably show it every time in case we have new people, but I'll just go through it quickly. These are the first three results that I had using effective pricing. So it does take some time to get your models set up and to tweak them and play around with them and test them to make sure that they're functioning properly. But as you can see, in the first three clients that I sold using effective pricing, these are some of the results I had. So the very first time, it was 13,800 a year more than what I would have previously quoted them. Using my old quoting system, I would have quoted them at 4200 a year. And with effective pricing, it came out to 18,000 a year. The second time, there is, you can see at the bottom, there's a price success metric that you get when you do a quote. So the second time, my price success metric was just over 200% increase from what I previously would have quoted them. And the third time, it was $22,000 more than my previous method. And not only that, it was also 30,000 a year more than what they had paid their previous bookkeeper. So it just goes to show about teaching the value and communicating your value and using the software, the kind of results that you get. And to date, my. My average is still just under 200%.

Okay, now the housekeeping and a couple of quick announcements. So, as usual with all of Mark's sessions and the trainers, make sure that your chat messages are set to go to everybody so that all attendees can can see your comments. There's often some great tips and info shared from your peers. I did see when I was taking a look at who's in the room. We have some very experienced effective pricing users in the room with us today. So if you have a question, drop it in the chat. I will, of course, look for those. If you put a QQ at the beginning of a question, it makes it super easy for me to find that when I'm scrolling through a few times throughout the session. But there's going to be, I'm sure, some great feedback from some of the more experienced users as well. Gabby is here with us in the session. She's going to be dropping a couple links in in just a moment. And also, if anybody's having any tech issues, just drop a comment into the chat and she will look after you. The materials that you're going to get from today's session, you'll have the recording, of course, and the slide deck. And then also there is a handout for how the prices are calculated, which is basically what I'll be teaching you today. But you're just going to get it in a handout format.

And like I said, I will try to remember to point out if I'm showing something that isn't what everybody maybe has access to. So I'm going to leave this slide up for a minute as I explain it. If any of you have attended sessions before, you're familiar with this program. Mark Wickersham Training has a program, a partnership story with B1G1, and they're a great organization that every time a business partners with them and makes a sale of a client, they make a donation on behalf of their company or the person that made the impact. So every time that you use this QR code or the link that will be in the slide that you get, it's what we call an impact. And those impacts make differences around the world. So for the month of July, these are the four causes that Mark has chosen to support. So if you have your cell phones handy and you can pull it out and scan that QR code to, it doesn't cost you anything except literally a few seconds of your time. It just pulls the site up. You click on which one of the four things you want to choose and that's it. Okay. Every little bit really does help. It's such an important cause.

All right, for Anybody in the UK area, there's going to be a meetup on Friday, August 2, from 10am to 12. It's open to everybody. It's not just for members. So if you're in the area and you'd like to attend, feel free to go. You would need to, however, email Sarah as soon as possible. The meeting is going to be located at the Intuit office and they have really strict security there. So if your name is not on the list that Sarah provides to them, you won't be able to get inside, unfortunately. So please be sure if you do want to go that you're emailing Sarah. Also, Mark has made it available with four of his trainers to do one on one coaching sessions that are available again. You can scan the QR code or click on the link when you go to the website. Each one of these trainers has a little bio attached so you can read about them. You can do a session one on one with them for whatever is impacting your business. You don't have to use the same trainer every time. You might be having an issue with E commerce and you want to talk to Terry or you might be having, you know, some concerns about business advisory and maybe you want to talk to Neil or Rennie. So do take advantage of this if you're struggling with something in your business and you need some one on one help specific company.

Okay, so I also wanted to mention that very shortly, as soon as I'm done talking about this, I'm going to be turning my cam off for most of today's session. We're going to be in live demo mode for most of it. And when I'm doing that, I'm actually looking at my other monitors. So I don't want to be showing everybody my ear through the whole session. So I'm going to actually turn my cam off.

And we will continue. So.

There'S several steps we're going to talk about today. Let me just quickly see if there's any questions.

Okay, so there's several steps that we're going to be talking about today and it's all about understanding how the prices calculate behind the scenes. And it's important to understand this whether you're editing one of Mark's models or building one of your own from scratch. Okay. You need to understand how the behind the scenes part that we don't actually see works. So I'm going to be toggling back and forth a little bit between the live demo and the slide. But for the most part I will be in live demo because most of the slides are really just screenshots of what's in the live software anyway.

So do know that when you get the handout and slides for today, you're going to have all the screens that I'm showing you to go to. You'll have an image or a picture of that screen that you can refer to. Okay, so let's go into the software.

All right, so I am in my settings window, which you get to, of course. Could I get a quick response from quite a few people in the chat for a minute of your experience level with effective pricing, I, I'm not quite sure how much I need to break it down but most people know with any software that we use, you go to the gear looking icon to get into the settings. So that's where I went when I went in here. And then I'm going to be spending most of the day today in this model management section.

Okay, so I see.

Oh, good luck, Karen. Yeah, I tested for a couple of weeks but before I went with my first. Oh, and it's this afternoon already. Wow.

Yeah, so I tested over and over and over again when I was first setting it up as well. So this version that we are using.

Is a test version that we have for this course. So in our session last month what I did was I took Mark's bookkeeping full model and made a copy of it. I showed you that when I make a copy of it I like to it will automatically put the date and time that you made the copy. I like to edit the name and just also just put a little bit of information at the end. And I also put to be edited even though I can see like whether it's live or not. It tells me here but it's just visually for me that's what I like to do. And then when I have finished all of my editing for the quote I actually go and I change the name of the quote to or the model. Sorry, change the name of the model to what I actually want it to be. So like cloud setup or forecasting like how Mark has names of these here. So I'm going to go into edit mode and I do welcome everybody to have your effective pricing open and go through some of these steps at the same time. I'm going to try not to go through them too quickly. So this is meant to be a pretty hands on course. And so if you have any questions about, you know, if you're following along and you have a question about something we've just done.

Let me know because I am glancing over the chat quickly.

I see Steve did his first proposal live yesterday. Congratulations, I hope it went well for you. Okay, so let's talk about our base price. So this first screen edit pricing model, this is just where you can change the name. You can select what type of work it is. We went through this a lot last month. You can select whether it's live or not. And then some more information that we're going to get into with the advanced stuff. I'm just going to click save and continue to go past this screen. And now we're into the actual model.

I don't know why I have a line here.

Okay, it's gone.

Okay. So to get to the base price, I'm going to show you where to do that.

So you would go into your.

Expressing price option over on the left. So I'm going to refer to this left menu bar lot. To get to your base price, you would go to expressing price. And then you can see this first box is global pricing parameters. There's a couple other options here. We're going to be talking about those later in today's session, but for now, we're just going to talk about base price.

So the default in the base price when you're using one of Mark's models will be zero. And you don't need to change it if you don't want to. But basically what this base price is is the starting point of where all your calculations will start. If you put a number in here when the price starts calculating behind the scenes, every time you're pricing a client and you're asking them questions, the price is not going to start from zero. It's going to start from whatever you say that your base is. So I like to use this to recover my software costs. I have two programs that are mandatory for every single client to use, and I pay for them through my wholesale billing, and that is QBO and Dext. So I automatically include $100 a month or $1200 a year as my base price for every client. And that gives me more than enough space for what the software costs me and also some wiggle room for those prices that increase during the year Somewhere from the software companies, it's never going to increase more than what my wiggle room is. And then when I reprice the client, if there's been an increase, then I would raise what my base price is. So I always have that buffer and I'm never out of pocket for my subscription fees. I do have questions in my model related to other software fees that I encounter for a client, but those ones we'll talk about when we get into setting up models, because those ones aren't necessarily mandatory for every client. These are the only two that are mandatory for everybody.

I think. You see the slide again, right? Okay. Didn't know it was going to do that. I think every time I click to advance the slide, it's going to let me actually stop the slideshow for a minute.

There. Now you can just see my pricing software and it will not jump over every time I go back. Okay, so step two, once you've got your base price set is the questions. So again, I'm going to my left menu bar and I'm going to click on questions and this is where your pricing really starts to build. It's really the heart of the software and you need to have a really solid foundational understanding of the calculation types that you use for each question.

We're going to go through some of the calculation types today and we're going to go through them in a lot more detail when we get into the next session and the one after that where we start actually building models. So as I mentioned, if you do have a base price, when you start answering these questions, it's going to build on those.

Prices.

Okay. I keep my.

Addition types or calculation types that I use pretty simple. There's. I'll just go into one and show you here.

There's several that you can use. You can have percentage, increase, multiply, add. These two go together. Number of units and unit price raised to power, root and minus. My models are almost all just multiply, add and a few are percentage, increase. I keep it pretty simple. I find there's less room for errors or things to go a little wonky if I keep it simple that way. It's just the way my brain works. So at the end, when you are done answering all your questions and you've got a price calculated, if you go to this review tab.

Yeah.

Do you think since there's so much real estate on the left and right of that screen, you might be able to expand the web, the web page a little bit, make it larger, zoom out?

I think if I do that, I'm losing real estate vertically and.

Oh, okay.

Yeah.

It's just the way the software is. It's not my monitor. It's just the way the software is that there's a lot of space on the left and right. Is it, is it really tough for you guys to see?

If you go up to the upper right hand corner on View.

Click on that. You can enter into a full screen.

On. On my Chrome window.

No, it's actually on Kimmy's. On the zoom. Oh, on zoom. Okay. Because at the upper right hand corner, mine's showing recording and I have a little view. So when I click on it, I can do standard side by side speaker gallery all the way to the bottom. You can go to full screen. That's what I did. That's for each person that's here. That's not for me actually sharing. No, I'm talking about for the person that says she Can't. Yeah, so sorry. Okay, so everyone can go to view and they could go into full screen and then it's a little bit bigger.

That way you don't have to adjust your screen. Yeah. Okay, great. So let me go back in here.

Okay, so edit so you can continue. So once you finish going through all the questions, we're going to take a look at the review screen later. You would have what we call our calculation price at the very end. So there's, there's going to be a couple different types of prices that I'm referring to today.

When I click on, when I go to my review tab and I click on this calculate button at the very bottom, this total price is what I'm referring to will be our calculated price. So I'm just going to go back to questions. The other thing that you can do is break things out into sections. So you can see there's an add section button here. And what this will do is put things. I, I really like using this for, I think it breaks it up visually a little bit for the clients because it will put every section on a separate page that you click save and continue at the bottom. So that way you don't have a long list of questions all on one page. So you'll see in Mark's example, he has a section that's called about your business and then a section that's about bill pay services. So I've called that account specific payable. For me, he's got a section for other things you might want. So in my bookkeeping model, I have about five sections. I have one for payroll and HR related things. I have one for accounts payable, one for accounts receivable, and then another one for scope of work. So breaking those sections out, I think it's just a little me. I think anyway just breaks it up a little bit. When you're going through this with a client.

As you are going through the questions, it's important to know that the price is going to calculate in the order of the questions. So when you're asking this first section first and you, you know, maybe your base price is the default of zero. As these calculations start to build. I'll go back to the review tab. You can see I had made my base price set at 1200. As I'm asking the questions, the price is building in the order that the questions are asked. Okay. There's one exception to that and it's if you choose to isolate a section.

And I'm going to, if you click on this box to isolate a section, what happens to that? And this is in the slide for you. It will calculate the price for that section by itself as a whole total for that section and it will add it up to the price of all the questions before that. So going back to my review tab, if I had this as an isolated section, this bill pay services, I would have a total here for that entire section that would be added to the 4390 which was the last price before that isolated section. So I like to think of it a bit as.

Math and formulas when we're using brackets or parenthesis. Right. So if you have a math question that says 10 plus 10 times 2, it's going to equal 40, right? You take the first 10, you add 10 to get 20, and then you multiply that by 2, you end up with 40. Right? What if you wanted to do the second half of that equation first? What if you wanted to multiply the second 10 by 2 and then add it to the first 10? The first part of your question now the answer is 30. So it changes your answer that you're going to get or changes your price that you're going to get. So it's important to play around with isolating sections and make sure that you test your pricing at the end if you want to use those. I see Mark has a question. So would isolate be used for catch up work since it would be a one off that wouldn't continue into the next year? Mark, I. I wouldn't use it that way. I actually have a separate model for catch up work all on its own. And, and I'm actually going to talk about that in, in a little bit when we get into the payment plan information and how long you can divide your payments over. I don't actually use the isolating sections myself. Again, I like to keep things pretty simple. I think the more compl. Complicated it gets then the more I need to tweak and edit things. If I. Because I'm. I'm constantly kind of changing my models or changing a question or something every time. It's like my service agreement. Every time I learn something from a client who's left, I then change my agreement for the next client that comes on and my models are kind of the same also, if I have things that I've learned from a fact find call that I've had with a client and I know it's a question that I want to specifically put into their model, I'll create a copy of my model and use it just for that specific situation. With that client if there's something that's pretty specific for them.

Okay, the next part we're going to talk about is the global adjuster. So we did see this earlier today in the expressing price section. In this global parameters there's a global adjuster. The default is going to be set to one. But the great thing about this global adjuster is the calculated price that you arrive at at the end. Remember, that price at the bottom of the.

Review page, that's your calculated price is always going to be multiplied by your global adjuster. So where this comes is in really handy is let's say at the end of the year.

You want to increase all of your prices. When you're repricing your clients, you're going to have a flat 10% increase. You have a couple options of how you can do that. Number one, you can go through all of your questions and edit them and make all of the numbers 10% higher. Or you can come to this global adjuster and Change it to 1.1, which is obviously a lot easier. Brian has a question.

Can you please explain again how the question factors can be applied? So Brian, I didn't actually explain that yet. I just really showed them. We're going to talk about them a little bit today, but we're going to get into the details of it in the next session when we start actually building a model. So today we're looking at how the calculation process works with which you really need to understand before you start putting those question factors in and putting your questions in certain orders and putting different types of calculations in them. So we're starting with the understanding of how those calculations add up. And then we will look at a couple of the basic ones today just as I'm demoing things. But then in the next session we're going to go through them in a lot of detail for each one.

So I'm going to table your question for a bit.

Okay, step number four in our how are we doing for time? Okay, step number four in how the prices get calculated. I'm going to take you this time to the pricing parameter section. We're going to spend a lot of time in this section today, but for different steps. There's a lot of things that you can do in here. The software as a whole is really customizable, but there's a lot of things that will impact your prices on this particular screen. So we're going to be looking at quite a few of the specific fields in here and it cal. So what this screen does is it calculates prices based on each of your packages individually. So we need to set up what our package prices are going to be. There's a couple of. We're going to ignore super and Light. You do have options for five different pricing packages, but most of us only use three. So I'm going to ignore super and Light. And as you can see down here at the bottom in the order of reveal section, I don't even have those ones turned on at all. Okay, so we're going to ignore those.

So let's pretend your calculated price is at the end of step three. That review page is $1,000. If we look at the essential package, the first couple of things we're going to look at is these two the relative price multiplier and the relative price add. So let's say our somebody is looking at the essential package and the price is $1,000. If I've gone in here and the default is set to 1 for the essential and add is 0, then that means that the price for that client is going to be $1,000. That's what's come up as the calculated price after they've answered all of their questions. However, if we look at the full package and there's a multiplier, in this case, that calculated price that comes up as $1,000 in this case, the price that's going to be revealed to the client will be 1300. In the premium version, it's going to be 1500. In the light example, if we were using that, it would actually go down in that case to 750. So whatever your calculated price is at the end, it's going this page, this pricing parameters page, is going to automatically take this relative price multiplier and add, calculate that, multiply it by your total price, and then the add box, we're going through these in the order of how the software calculates things. So there is other things in this page that I'm going to come back to because they're in a different order. So this is the first thing that the software is going to look at when it's calculating your price for you on this page. And then you have the add button. So let's say you had your full package. It's going to come up to $1,300. My premium package is going to be $1,500. Let's say for my premium package, I want to automatically add no matter what the price comes out to. If somebody's choosing my premium package, I want to automatically add on a thousand dollars. To whatever the final calculated number is there. Then I can use this relative add button as well. I'm just going to change that default back.

Mark has a question. Would I use the multiplier to offer a monthly service package versus a quarterly. Quarterly service package if the client needs a more inexpensive plan or lower cadence? No, Mark, I would not use the multiplier for that. I would actually use my payment plan system, the number of payments that we're going to defer it over and we're going to look at that shortly. And I also wouldn't do two separate models for that. My models are based on the services that the client needs, not the frequency of how often they need it or how they want to pay for it. So if they're hiring me for bookkeeping services, I'm using my bookkeeping model. But I would change the number of payment plans that are available for that client. So we'll look at that in, in a few minutes and I hope that we'll answer your question a little better.

Okay, so step five. Also on this pricing parameters page, the next way that the software is going to check what settings you have to calculate your price are these minimum and maximum settings. So you can see in my example, in my global parameters, I said that my base price was twelve hundred dollars. So the software is automatically recognized that right off the bat, my minimum price, no matter what, is going to be $1200. You can now go in here and edit these to whatever you want them to be. So when you have finished answering, when the client has finished answering all the questions and you have that calculated price, it is going to compare it against any minimum and maximums you have. So using that $1300 example, if I had a minimum price in here of 1500 on my full package, the 1300 price is not what's going to be revealed to the client. The software will recognize that I have said I want a minimum price for the full package of 1500. And that's what would be revealed to the client. And keep in mind, as we are going through a lot of these numbers today, until we get to payments, these are all annual numbers. Okay? Really important to remember and I'll remind you that next time too when we get into building models. These are not monthly prices, these are annual prices. Okay?

So I shared yesterday, if you were in yesterday's session, I shared that my largest client is currently $96,000 a year on my premium package. That's getting pretty close to this hundred thousand dollar maximum. So what I will do the next time That I am in my software, my version of the software, I'm going to go in and I'm going to increase that maximum price. Because when it comes time for me to reprice that $96,000 client, if I have a hundred thousand dollar maximum in there, that's all it's going to show for them. And they're a client that started, I think they started at 45 or 50,000 and just with scope and changes with their business and things that the extra services they've hired for me, that's how much has increased by, in, in the years that I've been working with them. So it's very realistic that it would increase more than $4,000 in my next pricing with them. So I'm definitely going to make sure that my maximum. You can set the sky the limit of what you want your maximum to be or perhaps maybe your niche market is working with startup clients and they might want the world when they're answering their questions, they might want everything from them but you don't want to charge them a really high price. So you could put a maximum price that you decide on. You know, it's enough to cover your expenses and make the profit and you're willing to do it for that price to still that's what you can do. I call the minimum I get out a bad price. I'm not going to do any type of work for less than get out. So my premium, I believe I currently have it set for about 5,000.

Sorry, really dry. I believe I currently have it set for about 5,000 that I'm not going to do it for less than that. Six thousand. Sorry, 500amonth.

Okay, step number six. As you know from price psychology, it's really important to make our price seem smaller at the end when we are quoting it to the customer. So everything that we've done up until now, like I said, was based on annual prices. But we're not going to actually give the customer the annual price. When we click our reveal, our price reveal button, we're not going to show them an annual price. We're going to divide it over a period of time. So I think it was.

Mark that asked the question about quarterly. So this is where you would do that. You would have a book, have your bookkeeping model, make a copy of it, maybe call it Bookkeeping quarterly. And then you would go into this section here, let me scroll down a bit where it says period spread over. And if it was a quarterly client you would Change this to 4 or however you wanted Them to pay. Okay. Also I use this for my cleanup model where I am charging them up front for the work. Like maybe I estimate that a cleanup is going to take me two months or three months or six months to do the work. Then I would spread this their total amount over the number of months that I want them to pay for the service.

So depending on the model that you're setting up, is the number of months that you would want the annual price spread out over. I just see some chat.

Going to look for questions.

Okay, don't see any questions. I think it's just chat going on there. Okay. So this is what we call chunking the price down. It's. It's that psychology of wanting to make the price appear smaller. So when we have our period spread over for the number of months, when we click on that reveal price at the end, it's going to show them the monthly price rather than the annual price.

All right, carrying on. So step number seven is what the software is going to do when it is calculating your prices is you can set it up to round the calculated price to a certain number of decimal places. So I'm going to take you back for this to the expressing price page and again in this global pricing parameters. This is the third field that we saw in the beginning. So you can choose whether you want to show or hide.

So.

Using the decimal places you would select show or not using them you would select hide. And that will round your pricing up. It defaults to two decimal places. So for example, using that earlier calculated price again of 1300, if I were to divide that by 12, when it reveals the monthly price for them, it's going to be $108.33. I don't want the 33 cents to show in the price. So I'm going to use the rounding feature because I just like to have whole numbers in my pricing. And so by default this setting will be set to round for you in H.

Step 8 is also applied to rounding. It's kind of a step 7B but it's how the software will use this information. So I'm going to go back to the pricing parameters page. It's kind of a two step process to set this up if you're using the decimal places in the rounding. So if you want to have the rounding applied to your packages, perhaps you want your pricing to end in a specific number. Maybe you want your prices to end in number five. No matter what the calculated price comes out to, it will round. If you set this up to End with the number five.

You'll see that you can customize each package individually. So we're looking at this rounding on and rounding amount boxes here. And you can customize each package individually. Okay. So you can, if you do want rounding on one package but not on another one, you can do that here. And what you would do is turn the rounding on and then your rounding amount would be 5. So, for example, if a calculated price came up as $1303 at the end and I had this set, the new calculated price would be $1305. Okay.

Just going to turn those back off.

I actually want to show you. Sorry. Before I turn them back off, I want to show you how this looks on the review page.

So you can see here that our calculated price is coming up as $6,681.40.

But I have rounding turned on that I want my prices to end in five. Sorry, I think I turned them on.

So I have it set that I want my prices to end in five on my premium package. So you can see my monthly price is now coming up to $835. So it is going to round for me. After I've done my testing, I will go through this. I. We're going to go through this a lot when we go have the session where we're talking about troubleshooting.

Oh, that's right. Thank you.

I'm trying to look at two different screens here.

Now we'll go back to the review tab.

Sorry, having some technical difficulties here.

Calculate.

There we go. Now, thank you for that for reminding me to hit my save and continue. Michael. So now my prices are coming up with the five at the end.

After we're doing troubleshooting in another session, we are going to spend a lot of time on this review page going through it in a lot more detail. So what I'm doing when I am pricing a client, I go through and I set them up as a client in my system already. I will go through the model that I'm going to use for them and answer a lot of questions ahead of time. Remember, I've already had my introductory call with this client. I've done my diagnostic review of their books. I've done a fact find meeting. I have a really good understanding of what this client is likely going to be looking for. So I will go through and pre populate a lot of questions. So, for example, if I know that they have three bank accounts and two credit cards, I will pre populate those answers. And what I would do is when I'M I would just say to them, you know, I wanted to save us a little bit of time today. So I, I pre answered some of the questions on your behalf based on the information I've gathered from you so far. I will quickly review those with you and you can let me know if you want to change anything. It could be an example that maybe I said that they average 50 sales invoices a month and that's what I selected for them, but they might want to select 200. Maybe they know about a change that's coming in the future with their business and they want to change that answer. So I still, even though I pre answer a lot of questions and I do it that way, that I tell them we're going to save some time like that, I do always tell them that they have the option to change any of those answers as well. But I like to do that ahead of time because then I can run my test of the model of what I think they're going to select and I can look at the price and make sure that I'm not going to have any surprise numbers show up at the end in my calculation when I'm in the actual live meeting with that client.

Okay.

Step nine.

Is where we will modify any discounts. So the software allows you to modify your pricing on demand if you want, right in the meeting with a client by applying a behavior reward to the price. So we're going to do that over here in this rewards section. Imagine that you have a client where you would want to use this is maybe they're hesitating. Maybe you've hit the reveal price and they're hesitating, or they might come right out and say that it's a little bit higher than what they thought.

You have the option to offer them rewards or incentives, if you will, in exchange for a slightly lower price. The behavior reward can be set to an actual dollar amount or it can be set to a percentage of the calculated price. We call them behavior rewards because on the screen, when we are revealing the price to our clients and they can physically see the screen, there's a little br.

A client is not going to know what BR means. I've never had a client ask me, what does BR mean? Can you click on that button? So I get to reveal it on demand if I want to. But if in exchange, if the discount said, or if the button said discount or even incentive, they would probably certainly then be prompted to ask, oh, are there discounts available? So that's why we call them. One reason we call them behavior rewards. The other reason we call them behavior rewards is because you don't want to give a behavior reward without getting something in return for it. So you want it to be something that's going to be of benefit to you or will make your life easier. You don't want to just give away rewards for things that only benefit them for the price. A reward is something that you get when you've done something good. Right? So we're rewarding them for a positive type of behavior that we want to see. So as you can see in the sample model that we have here, some of the questions are, will you scan all of your purchase invoices with receipt bank that is better for me or dext, it's called. Now, this is an an older model. I haven't customized it yet.

That is a benefit to me because it's easier for me to process their receipts if they do everything in daxt. I also have a question in mind about if they will send me if they agree to send me all of their documents by the fifth of the beginning of the next month. And if they do agree to that, then they get a percentage off or a flat rate off.

So some other things, there's a whole list that you can do with these. I encourage you to be creative. Think about what kind of benefits you really want to see from your clients. Don't just put something in just for the sake of having it. Make sure that it's something that is really going to benefit you and save you time. Because remember, you are reducing your price. So you want it to be something that's making your life easier. Okay. And we are, when we get into building our models, we are going to talk about these a lot more and we will go in to the calculations for them. Just going to do a quick check for questions. Okay. Not seeing any questions.

All right, so step number 10 of how the software is going to calculate your price is you have the option to also offer enhancements. So you get to the end, you reveal the price. You know, the customer says, yes, that's a great price. Let's go. I'm interested in your premium package. You click save and continue and it takes you to another page where there are enhancements. We also refer to them as our optional extras. Some people may call it an upsell, but again, the word enhancements is what we'll show in the software because it sounds better. So we're going to look at those here on this enhancements menu. Again, all of the models that we get from Mark will have some samples in them.

These calculations work very similar to the question sections. So you have the option in here, whereas the behavior rewards you only I didn't show that with the behavior rewards. Let me just quickly show you. With the behavior rewards, you have a couple of different ways that you can either subtract a dollar amount or subtract a percentage. With the enhancements, they work very similar to the questions that you have multiple ways that you can add a price, because now we're adding a price for something that they want. Right. So what I've done with this is my starter plan will have a few different options. I'm just going to go back to this other screen so you can see those sample questions.

I've set it up that the optional extras or enhancements on my starter plan are a few key things from my middle package that I know people usually want, but maybe they just don't want the full middle package. They might only want those few things. And this could be a bit of trial and error for you because it's not something you can customize on the fly while you're in the session. If. If somebody says, oh, geez, I really like that you meet with me monthly in your middle package instead of quarterly in your basic package, I would really like to have that. It's not something that you can set up right then as. As an enhancement in the software. Okay. So it could be a bit of trial and error for you, a bit of understanding about your ideal client, of what sort of things they're usually looking for. And then my middle package, again, has some things from my premium package, two or three things from my premium package, again, that kind of usually stand out to people, but maybe they don't want the whole premium package. And then the enhancements that are on my premium package are.

You know, the sky's the limit kind of things. Like one of my premium package ones, if they want to. To work exclusively with me, I charge a very high amount for that because, of course, my time is extremely limited. But hey, if somebody wants to pay that, why not make the revenue from it, right? And if it ever got to a point where.

You know, my time was getting too full with people wanting to work for me, I would just change my enhancement question and take that out.

Thank you, Jessica. Yeah, I don't like doing it in front of a client. That's why I just kind of said it's not there.

All right, so step number 11, jeez. Last month we went over time because there was so many questions and so the team had asked me to maybe do 90 minutes in case people wanted to stay over. And now today we're on the last step already. So if anybody has sections that they want to see in more detail, start dropping them into the chat, because I'm moving on to the last step here. So the final step that the software is going to do is if you charge sales tax, we can add that to the price to arrive at a gross payment that you send to people. So when you're playing around with this, you'll notice that even if you have your price set to zero decimal places in that earlier step that we talked about, if you set this up that your sales tax is included as a gross payment, it is going to show two decimal places now because it will still show the exact amount including the tax. So not everyone uses this feature.

You can customize this part in your expressing price section. Down here we have sales tax text, show and hide, so you can say whether you want it to be. If you click show, then you get this sales tax text page again. And you can type in plus hst. Or maybe you want it to be including hst. I always leave mine separate. I want to again, diminish that price a little bit, show them the lower price. And I just put a comment in that says plus hst.

Okay, but you can customize that field as much as you want.

And that is the 11 steps of how the software customizes the price and the order that it goes in. So can you. Cheryl says, can you review the relationships among base price and the relative price multiplier? And yes. So base price we set here on this expressing price page. So I just. So that it wasn't set at the default of zero, I did put twelve hundred dollars in as a base price. And then on the pricing parameters page, let's say.

My base price is $1,200. And if a customer answered no to all of the questions, that is going to be my calculated price at the end is $1200 because that's what I set my price up as. So the relative price multiplier, twisting over my words, if they chose my essential package, their price would. Even if they've answered no to everything, that price would still be $1200. If they chose my middle package and I have a multiplier in of 1.3, then it would be that. So the base. The. The multiplier, the relative price section is more on your calculated price at the end, which includes your basic price. But it's not a direct relation between Base price and the multiplier. Somebody would have to answer no to all of the questions in order for that relative multiplier to apply strictly to the base price price. I hope that helps.

Mark says pricing. For example, if certain services cost more than others and you aren't using it in as an enhancement, for example, does a client want a monthly live call or is an email summary or video video in an email sufficient? Would that be the differentiator when using.

The price multiplier between packages or is it a separate question that causes a different price.

So you wouldn't use that premium multiplier? So basically, okay, I'm just going to read through that a bit quicker than I did the first time. So Mark, you, you'll likely get different answers from different people. Everybody does things a little bit differently. We all learn from each other. I've seen sessions that Jessica has done or Terry has done on effective pricing and I'm like, oh, wow, look at how they're using the software. That's great. Myself, the way that you've asked your question, if I understand it, I would actually set it up as separate questions in my software. So I would have a question. I'll just go back to the question and it could be something about, you know, what type of meeting would you like to have with a meme? And then your answer could be.

A drop down answer, right? And in your drop down, we would set. There's another section we'll get into next month when we start building our models where you can build your answers here. So you could say if they wanted monthly live call, it's $500, or if they want a video call, it's $300. So you could ask them the question at the beginning, what type of meeting would you like with us? And then you can set up your choices. That would be a drop down answer. Oh, actually I see. Michael said the same. I should have read the answers first. Michael is saying it exactly the same way that I would do it. But Mark, then no, the, the multiplier, remember, is going to apply to your entire calculated price. Okay. You can't set the multiplier up to work for just one question unless you use multiply as your addition type. Okay, so you can use the multiplier on a specific question here.

But if you're talking about the relative multiplier that we were just discussing, then that would apply to the entire calculated price that we saw at the end of that review page.

So then Steve says, how about some, I think this is a question even Though there isn't a QQ at the beginning. How about someone picks monthly meetings? But I only offer that in the premium package.

So it's one thing that I, I actually wish the software did and, and I hope it comes in the future is the packages that we have. I'm just going to go to that page.

These packages do not change dynamically according to the answers that people ask you. So when you are going through your brochure with the client, you have a screenshot page in your brochure of what your packages are. They don't change as you're going through your brochure. The software works the, the same way you set these up ahead of time and, and you can't change them right in the meeting with the client. So if somebody was really interested in monthly meetings and it's only part of your premium package, as I'm going through the price reveal section with them, I would say to them, I noticed you mentioned that you want monthly meetings that is available in our premium package. Is that the one that you're leaning towards? If they weren't, it might be something that I have as an enhancement on my enhancement page for them if I find that it's something that people are asking for on a regular basis. Or I would say to them, you know, maybe in my middle package I offer quarterly meetings. I might say, do you want to try quarterly meetings at first and see how that goes? When I'm pricing a client for the first three to six months, depending on the complexity of the file, I do tell them that I will revisit their price for the first few months and they are welcome to do the same as well. So if they chose monthly meetings in the beginning and felt it was more than what they needed, they could change it to quarterly or vice versa. Versa. I don't actually sit down with them and go through the entire effective pricing system again, but I am willing to modify the price for them in the first few months that I start working with them.

So Michael said in that drop down style question, he adds the amount for the meetings and then you could multiply them if you want.

Jane has a question. I would like to understand how many templates you would typically use as some customers are more needy than others. I love that question. You know, I'm going to.

I was going to turn my cam back on, but that's okay because I'm still in the software. I don't want to show you guys my ears. So I, I have.

I have probably three templates that I use on the regular, if we go into.

Model management, depending on what version of the software that you have or what level access to the software that you have because there's, there's different levels that people in our audience may have today, you'll see there are a whole lot of models that Mark gives us. And then you can also create your own new model right from scratch yourself. You don't have to start with one of the templates. I have.

I have I think about eight or nine models but honestly most of them are ones that I maybe created for one or two of type situation. It's got a very particular, particular question.

For a specific niche that I work with. And I would use that model depending on what I have found out in my fact find meeting in my diagnostic. But for my standard normal services all the time, I have bookkeeping, I have payroll, I have cleanup. Those are kind of the three that I use on a regular basis.

Mark says PETA Premium, you guys are cracking me up. So Mark says if you have questions that would change the pricing, why would you use the multiplier? By default the questions would change the package. You're right, Mark. I don't use the multiplier. Like I said, I tend to keep it really basic and simple. It's just an option that is there for you if you, you want to.

If you're confused with the overall multipliers used for when the service are, are what is changing the overall price? Are you talking about the global adjuster in the second half of your question.

There, Kimmy, it's the originally underneath your premium basic packages there was this overall multiplier. 1, 1.3, 1.6. What's the point of that? If by default your packages have extra services which are going to cause, which are going to cause differences in the pricing anyway.

It could just be that the, you know, some of the questions that you have, you may, somebody could answer the questions all the same way. Right? And we'll use that thirteen hundred dollar example again. Let's say they answer the questions and the calculated price comes up as the $1,300, right? Because remember our packages are static. You don't want your prices to be $1,300 all across the board for basic premium and, or basic middle and premium. So you can use this multiplier or your minimum maximum price would likely do the same thing as well. Because if you, if somebody answered and you know it came out to $1300 as their calculated price, your middle packages can show.

Sorry, no, I haven't said Anything. I. But your, your premium, full and essential packages by default will have extra bells and whistles, which will cause a difference in price. So why would the multiplier then be used on top of that?

I, I don't use the multiplier, but it can be used be it comes to when those packages being static. Right. When you're talking about your premium, middle and full packages, if somebody's choosing your premium package, this really actually doesn't have anything to do with the questions that they answered. They might have chosen. Yes, we want you to lead or let me go to something that's just premium. Yes, we want regular business review meetings and advice that just calculates the price that doesn't automatically put them in the premium package.

Does that answer your question?

I think as I play with it, it'll make more sense.

Okay, so let me use another example. So let's go to questions.

And let's.

Say, because Kimmy, I feel like all three package offerings are not going to be static because by default each package might have something extra in it already.

No, but when you show this packages page, this is static. This is not going to change.

So if somebody says I want how.

Their checkbox is dedicated account manager. So by default, if they say I want a dedicated account manager, that might change the price between premium and full. And since it's already doing that, you wouldn't necessarily need a multiplier.

No, it, it doesn't do that. That's what I'm saying. It's not dynamic. So dedicated account manager, if they ask you if they want a dedicated account manager and they say yes in the question, it is going to affect their price. Absolutely. According to whatever price you've put in the question, it will change their calculated price, but it doesn't mean that they're automatically going to get the premium price. Okay. So they could say they want a dedicated account manager and that will be worked into their price. But then when they come to this page, they could still choose the full or essential package and they may have answered yes to that question. And it's built into the price already, the payment plan that would get here. But these, these things that are static here, they do not impact the price at all. It's only the.

Oh, I understand. So if they. So for instance, in the full, if they're saying they want less things in the full, but they're picking some premium items, you want to make sure that the premium is at least somewhat more expensive than the full overall.

Exactly.

Okay.

Yeah.

Thank you.

You set these up ahead of time. And they can't change based on what the customer wants and how they've answered the questions. And that's why there's a lot of tweaking with the programs, especially when I started, because it is some trial and error. Do you have your packages already?

No, I'm in the middle of building them now because I'm offering, I'm. I've approached my clients that I'm going to be offering them a whole new suite of packages beginning in, in two weeks.

Okay, nice. Yeah. So these packages, it's the one thing when I started using the software that I thought would be a nice to have feature that yes, if somebody chooses all the premium type answers that I have, like the dedicated account manager is a good one, or summary management reporting that it would automatically put them into this premium package. But it's not. It's a verbal discussion that you have during the pricing meeting where you could say, you know, I know you answered yes, that you wanted a dedicated account manager while we were talking. That is include when I reveal my price, I ask them which package they're leaning towards when I'm in the meeting with them and then I reveal the price. So I would say, because I would go through this, I would be like, okay, our premium package includes all of this. Our full package is all of this, our essential packages, all of this. And I would say, which package do you think is what you need or that you're looking for? And they might say at that time, oh, I really like the premium package because it includes the dedicated account manager. And I, and I really want that. And then I would click on my price reveal button and that's when my prices would show up. But just because they've said they want a dedicated account manager is not going to change anything on this page as I'm in the meeting with them.

Okay.

I see some other users are answering as well with some great tips. So following Jeff says, following up on your previous comments.

I find I frequently. Sorry, my question must move. I find I frequently do need to tweak the base model slightly based on the prospect because certain questions need to be added or modified based on factors like the industry or stage of the business. Is there any means for organizing these pricing models and in model management? So it isn't just one long list of all these various models. Can the list be structured or organized in any way? So Jeff, to answer your question.

I'm curious why you would have models for those types of questions about industry or stage of the business. I have as Questions. In my models I have an industry question, what type of industry are you in? And then I have a drop down and in the drop down I have if they're in construction or restaurants or service and then I have percentage multipliers in there that it multiplies based on the industry that they're in or maybe subtract based on the industry that they're in. If they're in something that's really easy and same thing with the stage of their business. I have a question about, you know, have they been open less than a year or one year to three years kind of thing? And I base my prices on that a little bit as well. So I don't have separate models for that.

If you could maybe just reply like how many models do you have?

I'm just going to go back into model management here.

When we get into the sessions where we start actually building models, I'll probably be toggling back and forth a bit between this demo test version that we're using and also my live versions that I use. And I'll show you, you know, how the options that we have of how we can set things up and then also how I have them set up.

Jane says it would be really nice. I'm just trying to build and it does seem a bit overwhelming on where to start. Jane, it is a very robust software that has a lot of customization involved. That's why in the beginning I really just chose to, to keep it simple with those additions and multiplier type questions, a little bit of the percentage increases and that has really worked for me with phenomenal results. And so I've just kind of stuck with that method and I haven't really tried to make it over complicated with a lot of the other options that are there. The options are there. However though, if, you know, maybe you're really into a lot of advisory type work or a niche that has a lot of complexity with their pricing that you do for them. So it's good that the software has those options. If you need to be able to do that.

Think about the questions.

I see lots of comments. I'm just scrolling for questions. Okay, Derek has a question. The final price offered first relies on the prospect selecting the package. Then this price changes with any enhancements selected to get to the final price. Yes, that's right. So let's.

I'm just going to quickly use this for a quote. I'm going to say Colonel Sanders.

So let's say we go through and so here's that industry type question that I was mentioning. Let's say they are a doctor. They don't have any divisions. I'm just going to pick a few things here.

Say two bank accounts, one credit card account.

One PayPal account.

All right. And now I'm just going to quickly.

Go through everything. So here is our packages list. Right. So this is where I would say to the person, you know, which I would go through my list and talk about them and talk about the value for each thing. Right. We always wanted, we don't want to just say, oh, I'm going to reconcile your bank account. We want to talk about the value of why we're reconciling their bank account. And I would ask them before I reveal any price, I would ask them which package do you think is interesting for you or will suit your needs? Once they tell me that, then I click on my price button.

Wow, that's expensive. This is why I like to test it beforehand. I, I didn't go through this, this demo model to see everything, but then I would click on my price reveal button and so let's say they say, you know what, I am going to go with your full package. So you would collect, click your select button.

Save and continue and it will take you to your enhancements page. Next.

Say they choose.

So on the previous page. Sorry, let me go back one we had, the full package was 12 payments of $8,335. So let's say they say, yes, we want sales tax returns, yes, we want our dividend vouchers.

Yes, we want inventory control. I'm just going to say yes to everything here. And then we hit save and continue again. We are now going to arrive at a new total page. So the previous total was 8, 300 and something. Sorry, I don't remember numbers. I've got too many of them in my head. But you can see that the monthly price has gone up by approximately $400 a month. So that is how the enhancements page will change what your final price is. At the end, Derek.

Jeff says, oh, this is a follow up. I don't have a bunch of models. But sometimes in preliminary conversations, the prospect already rules out items that they want or perhaps want to split out responsibilities with internal stuff. So I don't want to include questions or services that don't apply. That's okay, Jeff. I, I would still have my model. I'm not going to take things out if a customer doesn't want it. If they don't want it, they can say no to that question. I'm not going to create a whole new model just for things that they've said that they don't want because staff are going to do it. I would use my questions for that.

And I would have an option. Actually Michael has said the same thing. You can have a drop down question where it can be a yes or no type question that does calculate a price if they do want it or doesn't calculate a price if they don't. You can set up what you want those drop down options to be. So if it's something you know, there's sales invoices, for example, you could have 0 your as your first answer in the drop down list and then 1 through 10, 11 through 20, so on and so forth. And if they have an internal staff person that is going to be processing the sales invoices and you don't need to do that, they could just select zero for that.

I just need to read some stuff in chat here. I see Mark and Steve have a conversation.

Going back and forth.

With some replies, but the beginning one I'm guessing was a reply to something else earlier and I don't see any qqs. So I'm not going to spend time reading all that because now we are getting to. We've used up the last half hour really good with questions, so that's great. I did just see another question here from Terry Lynn in the last few minutes. Can you briefly talk about what we can expect in future sessions? Absolutely. So it is on the Trello board as well of what we're going to be covering in each session. You can pretty much tell from the title of the session, but in the next two meetings it's part one and part two, we are going to be be building models. We're going to be putting everything that we've learned so far in the intro and in calculating the price to work. And we're going to start building some models. We're going to start using a template and editing, editing it first. So that will be sessions three and four we're going to look at in those sessions, editing the models, setting up your questions, the question types, conditional formatting that you can use, unit pricing and number of units, the one that I briefly showed earlier that go together and then expressing the pricing at the end. The part two of the models is we're going to look at setting up your packages, everything that sort of comes towards the end. So the first session is going to be a lot about the questions and the prices that we attach to the questions and then we're going in the next session we're going to talk about everything that comes at the end. So setting up your packages, that behavior rewards section, the enhancements section, the descriptions. So the software has places where you can change I showed you with the sales tax option where you can type +HST or including HST. You may have seen, I'm just going to go back into my model here.

You may have seen here that there are these tool tip texts. So these are all free form text fields where you can type a description of how you want your packages described. So I like to describe them. That my essential package is similar to having a part time bookkeeper that comes in, you know, once a week or once every other week and does everything for them. And then my middle bookkeeper is comparable to having a part time bookkeeper that's in, you know, maybe a couple of days a week. And then my premium package is like having a full time bookkeeper at your side all the time. So in that session we're going to talk about all the different places where you can change your description. We're also going to talk about how to test your model and get into troubleshooting. When I said we're going to spend a lot of time on that review page, we're going to look at troubleshooting. I'm going to purposely create some errors in the questions and show you what happens and how to fix them. Then after we finish those sessions about the models and building out your questions and everything, we're going to start getting into some of the what what I think starts to get into some of the more advanced things with the software. So creating the actual quote, the fixed price page, the enhancements page, using a payment plan, finalizing everything. Then we're going to talk about the proposals, the templates that are available there for you using keywords, how to manage images, how to put in a price table, headers and footers, everything to do with the proposals part of the software. And then.

On the last session we're going to talk about the some more about the payment plans and integrating it with qbo. I don't actually, it does integrate with Xero as well. I don't actually use Xero, so I'm not familiar with that part. But we're going to talk about how it integrates with Xero. We'll talk a little bit about how you can use Canva with your pricing and then we're going to talk about pricing a couple of different models about pricing for can, cloud setup and pricing for a cleanup Project.

Okay.

Got a minute or two left here.

Derek says he struggles where to peg the initial pricing. I'm experimenting by using 2% of turnover. Maybe future tips on this. Derek, would you, if it's something that you'd like for a future session, could you maybe just post that in the Facebook group? Or you can message me on Facebook as well and I'll make a note to build it into one of the future sessions.

Michael, not sure why you're not seeing that.

It is there.

So here is the effective pricing sessions and here's building your pricing models, part one, part two.

And when you open the card, there is a description about what we're looking at in each session. So I'm not sure why you're not seeing that.

That's something that I guess you would have to message Mark's team about.

Are you a member of the academy, Michael, or are you using just effective price? Okay, yeah.

So Lynn, I'm just going to cover Lynn's question first. We're, we're one minute over, so if anybody needs to jump off, I'm just going to answer Lynn's question quickly. Will you be covering enable individual package pricing and enable additions to selected packages? It wasn't part of the current curriculum, Lynn, but again, I'd be happy to build it in.

You know what? Let me. Actually, no, I'm, I'm going to shut down. Maybe I'll take a copy of the chat and, and we can build that into a future session.

Okay. So I'm going to stop sharing.

And turn my cam back on for a minute.

Hi again, everybody. So I want to thank you all for coming and just remind you that the same way the price builds as you go through the software is the same way that we are going to build as we go through these sessions on how to use the software. As I kind of just reviewed there, we're going to start gradually and work our way into things.

I mentioned it a few times as well. Just keep it simple, especially in the beginning when you're first starting out. Don't over complicate things. You can have almost. I mean, the biggest takeaway maybe from today would be that you can have almost every question as an add or multiplier or perhaps the percentage or number of units and a unit price. I mean, the other options are there, but I, I can't really see anybody when they're starting out needing those. So the next session is going to be on August 29th. These sessions don't run the same way that it's every second Tuesday of the month or every second Wednesday of the month. They're kind of. Because this, this course was built in after the year had already started. We've just kind of fit the meetings in on a random schedul. But then next year it'll be a little more simple. So next session is August 29th at 11:00am and that's when we're going to start looking at the models. So I'm going to monitor the chat for a couple minutes. Gabby's going to play some exit music here. If anybody does have a last minute question, I'm still here for a minute. Okay, thanks and have a great week, everybody.

Sam.

Sa.

Sam.

Wake up.