I need some advice on making the psychological shift from being a business employee to a business owner. I started a couple of businesses five years ago, and I’m surviving as it is, but I’m right on the lower limit. I can feel that it’s my own psychology that is holding me back. I don’t struggle with the practical running of the business, my problem is feeling like an exploitative schmuck because I’m charging people money for stuff. I can push just enough to let myself survive, but after that I freeze. It’s a big block for me, and I just can’t seem to get past it on my own.
I know there are tons of business self-help books out there, but I don’t have the time/money to sift through all of them to find the non-icky diamonds in the rough. And I figure there have to be at least a few people out there who have made this transition and faced the same problems. So:
- Have you confronted this problem for yourself? How did you approach it?
- Were there any resources you found helpful to wrap your head around the transition?
- Do you have any experience with business coaches and/or associations, and were they helpful (ie. worth the money)?
- Are there any Lemmy/Reddit/Discord/other groups you found supportive/helpful?
Thanks much in advance,
~Archie
Ok, let’s work it out. What do you mean by “overcharging”? I use the same word, but everyone has their own definition. In my head, that means asking for more than I need, regardless of what my service is nominally “worth” on the “market.” Whatever those two terms mean…
Hah, exactly that. Basically whatever is “fair” in my head. But that pretty much comes down to “any more than I need” like you put it. What makes it worse is the majority of my business is local family owned farms so I feel like I’m taking food out of someone else’s mouth if I’m not giving them the best price I can. Even if it’s already well below “market value”.
I really think growing up dirt poor broke how my brain sees money and fairness.
I mean, I know people who grew up poor and became voracious sociopath capitalists… Personally, I think you’re on the better team :)
Ok, I have the same feeling, but I come from a very different context: professional parents who always did well but were never business owners or at all entrepreneurial. Where I really resonate is the sense of taking from others in order to service myself. Somehow I don’t see the transactional aspect of it, i.e. that although I’m technically “taking” something, I’m also giving something up in order to earn the right to take it (if that makes sense). I guess I don’t feel like I deserve it.
Out of interest, how big is the margin between market rate and how much you charge? Could you split the difference?
At least 50% or more. Probably close to 100% if you factor in the quality (I’m very good at what I do, just not good at getting paid for it). And yes, I could easily split that difference and I doubt anyone would say much, let alone go somewhere else. At least a couple times a year for the last few years I tell myself “I’m going to increase my rate 30-50% to be more in line with others”; and I do for a couple days and then fall back into old bad habits.
I’ve considered hiring someone part time just to do the billing and be a bulldog about it, they would probably more than pay for themselves.
Oh, wow, you are definitely selling yourself short! But you do also manage to push yourself to charge more… for a while. Which is not nothing.
Is there an emotional cue that makes it difficult to stick with it? I think I know the answer already, but do people express the fact that they’re hard-up and need a discount? Because I’ve been told (though I struggle to accept this myself, obviously) that a lot of people actually like paying good money for good work. They don’t like to get ripped off, but they also get a positive feeling from supporting you, support which you obviously deserve. They also get the personal ego-boost of being able to pay for something expensive. Which I super don’t understand because I don’t really care about status symbols or expensive things.
Something I’ve found helpful with my service-based business (as opposed my sales-based writing/music one) is that I’m legally required to have a contract before I can start working with someone. And, of course, a part of the contract is the service fee… So once it’s changed on the contract, it’s as if it’s out of my hands…
Personally, as I think about my responses here, I’m starting to realise that my problem is more with marketing than charging, though they’re closely related. By marketing, I’m stating that I’m good enough for people to pay for highly complex, nuanced work (which feels arrogant), and by charging, I’m demanding money for that arrogance. And, weirdly, charging them money feels like I am causing them pain, or harming them in some way.
If there is, it’s subconscious. But entirely possible.
That I fully understand tho. I am that same way. I recently needed a part that is not currently available in the US. I found a guy local that refurbishes them out of his garage. Did a stellar job and charged me next to nothing. I left 3x what he asked and walked out completely happy. Because I thought it was still fair at that price; and because I wanted him to still be there if I needed their services later.
I realize now we’re doing the same thing (offering a quality niche service in the middle of nowhere), and screwing up in the same way (not charging for what our services are realistically worth). I’m sure some of my customers feel the same way, but it’s hard for me to comprehend.
That’s true. But also where I sabotage myself. I’ll try to quote the cheapest possible price first instead of adding extra for the unknowns that are bound to pop up. And then when the inevitable happens, I just eat it up until the point I’m not profiting anything and tell myself I wont do that next time. Until the next time, lol. Definitely something I need to work on.
That is exactly what it feels like. Even tho almost no one complains about the price.
But like the example above, It’s easy for me as an outside observer to see the value in someone else’s service. But when he wrote out my invoice, he probably thought like I do, “they know this really only took me 30 minutes so I can’t charge that much”. Even tho it’s years of experience, training, and thousands of dollars in tools that made it possible to do in that short of time.
Appreciate you talking it out. Also some other good advice in this thread. I will make a better effort at evaluating and charging what I should. Best of luck with your businesses!
You too :) Getting feedback from real humans is super helpful.