Study Reveals How Price Affects Meal Perception

Hispanic Family Sitting At Table Eating Meal TogetherA recent study done by Cornell University found that diners rate the quality of their food higher if they pay more for it.  In addition, the people who pay less for the exact same meal report feeling more guilty, bloated and uncomfortable after eating.

In short, how much people pay for food has a big effect on how they experience the food.  If they pay more, they have a better experience than if they pay less.

To read the article about this study in full visit http://www.huffingtonpost.com/2014/05/05/expensive-food-taste_n_5267707.html.

This news should give any of you personal chefs out there, who are charging too little for your services, courage to raise your prices.  But I know how difficult that can be.

Why?

Here are 3 reasons personal chefs don’t raise their prices when they should…

Reason #1:  They base their prices on what other personal chefs charge

All too often the first thing personal chefs do to decide what to charge is look at what others are charging.  This is a mistake especially since many personal chefs are charging too little for their services to begin with.

In addition, your services, niche, positioning, work location, experience, and financial goals are likely very different.  There is no way what you charge should be the same as what someone else charges.  It’s just not the right way to go about pricing your services.  In addition, if you are too focused on what others charge, you will be less likely to raise your prices to a point above what others charge.

Reason #2:  They fear losing existing clients and turning potential clients away

This is a big reason why personal chefs don’t charge their worth.  They are too afraid of losing business and being rejected, but it’s better losing a low-paying client or not getting the business than it is to work really hard and not be compensated.  Over time, you are going to feel taken advantage of if you don’t charge your worth.  And keep in mind that a price that is too low can actually turn prospects away because they associate a low price with low quality as is mentioned in the Cornell University study.

Reason #3:  They don’t value themselves or their services enough

Sometimes personal chefs charge too little because they don’t value themselves and their service as much as they should.  If you don’t believe in the value of what you offer, no one else will.  You must have absolute confidence in your services and your prices.  Get rid of thoughts like “I am not experienced enough yet”, “I didn’t go to culinary school so how can I charge more?” or “I wouldn’t buy my services at the prices I charge so why would someone else?”.  You will never get the business at prices you deserve with this kind of thinking.

If you feel you are working hard for little money or you are afraid to raise your prices so you can be compensated fairly for the work you love to do, sign up for the free teleclass Top Secrets to Charging More and Getting It! that I will be hosting this Thursday, June 12 at 7 pm eastern / 4 pm pacific by clicking here http://www.chefindemand.com/pricingsecrets/chargemore.

Why Charging Hourly Doesn’t Work

Time is money conceptFiguring out what to charge and how to charge for your personal chef services can be an ongoing struggle for both new and established personal chefs.

There are so many issues that arise including the following…

  • What should I charge for my standard personal chef services?
  • Do I or don’t I include groceries?
  • How do I pass on a price increase without the risk of losing a client?
  • Should I increase my prices or lower them?
  • What do I do if too many people say they can’t afford my services?
  • Do I offer discounts?
  • What about bartering?
  • How do I price my services for family and friends?
  • Do I put my prices on my website or not?
  • Do I charge if I am doing something for a non-profit organization, charity, or good cause?
  • Does it ever make sense to give my time away for free?

And the list goes on and on…

I won’t be able to delve into all of these issues during this short blog post; however, I do want to share with you one important thing you should NOT do when it comes to the way you charge for your services.

Don’t charge for your services on an hourly basis.

Here’s why…

Downside #1:  Clients will be more likely to question time spent

What can all too easily happen if you do charge by the hour is your clients will begin questioning the time you spend and whether it is warranted for the meals they receive.  Sometimes, something that appears like a simple dish to your clients is actually a dish that is very labor intensive, but your clients won’t get that because they aren’t as knowledgeable as you about what it takes to prepare and cook food.

Downside #2:  Clients like knowing what they’re going to pay up front

It is much less scary to commit to your services if costs are known up front.  There is nothing open ended.  In addition, when costs are known up front, it is easier for your clients to budget their money effectively.  This is particularly important for clients who don’t have lots of money at their disposal.

Downside #3:  You may hesitate to charge for the hours worked

When you charge by the hour you may sometimes feel guilty charging your clients for the hours you actually did work because you are afraid your clients won’t understand why it took you so long.  You might also question your efficiency, and if you think you weren’t efficient (even if you were in actuality), you may be uncomfortable charging for the extra time you deserve.

Downside #4:  You aren’t being compensated for the value provided

The value of your service goes well beyond what you are paid for your time.  A person who hires you for your services is often struggling in some way.  He is trying to lose weight before undergoing gastric bypass surgery.  She wants to spend more quality time with her family.  He needs to get his food allergies under control.

The value of your service to these kinds of people is often priceless.  By charging by the hour, you aren’t capturing the true value of your service, and are, in essence, short changing yourself.

Downside #5:  You aren’t rewarded for doing a good job

This may be the strongest reason why you should consider not charging by the hour.  Just think about it.  Let’s say you charge $50/hour, and let’s assume this is a rate that other personal chefs charge too.

What happens if you are an efficient and experienced personal chef who can get a lot of meals prepared in half the time that it takes other personal chefs?  You will make half as much as the other personal chefs who aren’t as good as you for a similar service.  I’d much prefer to charge for my services as a whole instead of by the hour so as I became more efficient and better at my job, I would make more for my time.  Wouldn’t you?

What do you think?  Do you prefer to charge by the hour or charge for the service?  Why?

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Struggling to charge what you are worth?  Tired of hearing potential clients say they can’t afford your personal chef services?  Join Sandra Hoedemaker Client Attraction Strategist at Chef in Demand for a free training call by clicking here ==> Top Secrets to Charging More and Getting It! so you can end your pricing and money struggles for good.

Free Teleclass for Personal Chefs: Top Secrets to Charging More and Getting It

TopSecretsAd_Coins_CroppedHow You Price Your Personal Chef Services Can Make or Break You

If you charge too much for what you offer, no one will hire you.  If you charge too little for what you offer and get the business, you may end up feeling under appreciated, overworked and resentful.  In either case, you aren’t likely to earn enough to make ends meet, and you are definitely not going to feel prosperous.

So what do you do?

During my upcoming, free training call Top Secrets to Charging More and Getting It, I am going to share with you how you can have prices that compensate you well while still getting prospects to say “yes!” to hiring you.

This training call will take place on Thursday, June 12 at 7:00pm eastern / 4:00pm pacific time.  To learn more and to register visit http://www.chefindemand.com/pricingsecrets/chargemore.  And if you know of any other personal chefs who may benefit from this free training, please share this information with them.  I look forward to you joining us!

Are You Over Delivering and Undercharging?

Portrait of overworked woman cookWe are told that we should always exceed our customers’ expectations, go the extra mile, and add lots of value to whatever we do.

As a personal chef, you probably take these sayings to heart.

After all, giving everything you’ve got to wow your clients is what you do.  And because you are a personal chef, customer service is paramount.  You must tailor what you do to each of your clients and pull out all the stops to impress them so they will hire you for the long-term and rave about your services to others, right?

Here’s the thing…

You can take things too far if you aren’t careful.

When what you give goes beyond what you earn, there is a problem.  Here are some of the tell-tale signs that you may be over delivering and undercharging:

  • You feel as if you are working very hard and have most of your cook days booked, but you are struggling to make ends meet financially each month
  • At the end of a cook day or catering event you feel resentful because the amount of money you earned doesn’t seem like much compared to all the effort you put into what you delivered
  • You are often doing tasks that go beyond cooking for your clients like running errands, babysitting for the kids, feeding the dog, cleaning up non-kitchen areas of the home, etc…
  • You find yourself saying “yes” to whatever your clients want instead of setting boundaries
  • The scope of work expected by your clients is always expanding
  • People who use your services tell others to use you because you are cheap instead of a great value

Now I am not saying that you never go the extra mile to service your clients because doing so will turn your clients into raving fans, BUT you need to be absolutely clear what extras you are willing to give and what extras go beyond the scope of what you want to offer.

Here’s a simple exercise to help you figure this out…

Step 1:  Sit down with a paper and pen right now so you can jot down everything your service provides at a minimum.  Be very clear about this.

Step 2:  Brainstorm for a few extra things that you will be comfortable doing for your clients even if you don’t get paid more money.  This is how you exceed your customers’ expectations.  You don’t tell them about these extras upfront.  They are things you offer once you have been hired.  They come as pleasant surprises.

Step 3:  List all the things that go beyond what you are willing to offer or what you are willing to offer without charging more.

Once you are very clear about what your services include and don’t include, you will be much less likely to over deliver and undercharge, but you also must pay attention to how you are pricing your services to begin with.

You need to make absolutely sure you aren’t charging too little to earn what you should for the services you do want to provide.

TopSecretsAd_CoinsTo help you with pricing and charging your worth sign up for my upcoming free training call Top Secrets to Charging More and Getting It! by visiting http://www.chefindemand.com/pricingsecrets/chargemore.  This call is for you if you want a simple, 3-step formula to help you get a “YES! Sign me up for your services” instead of a “No, I can’t afford it” response.

Don’t Make These Money-Sabotaging Mistakes

Losing moneyMany personal chefs are extremely uncomfortable when it comes to asking for money for the services they provide.  As a result, they sometimes end up making a number of critical money mistakes that prevent them from building a thriving personal chef business.

Often these critical money mistakes occur because of negative money mindsets and beliefs that were established many years before, but these mistakes can sometimes be made because of a lack of clarity about what you are offering or your inability to truly believe in the value of your personal chef services yourself.

Now while I would love to talk about how to deal with negative money mindsets and beliefs as well as any of the other reasons why you may be uncomfortable having the money conversation, this is a topic for another time.

Today, I want to just shine some light on a few of the more common money-sabotaging mistakes that are made by personal chefs so you can either stop making them or never start making them at all.

Mistake #1:   Discounting or Giving Away Your Services for Free

If you are a personal chef who is uncomfortable charging what you are worth the following statements may resonate with you…

  • I couldn’t charge them my full amount, they’re family!
  • She is such a dear friend and has done so much for me, it wouldn’t be right to charge her for my services.  I owe her.
  • It’s for a good cause and I want to give back.
  • He couldn’t afford my services and he needs me.
  • I had to give her a discount because it is better to have some money than no money at all.

Do any of the above sound familiar?  The only times you may want to discount your services or give them away for free is when it is part of a well thought out strategy.  For instance, when you are planning for the upcoming year, you take a look at your finances and decide how much you can give back to support your one favorite charity, and then you don’t give out more than what was planned.

Doing this is much different from giving your services away for free without regard to your financial situation or a charity’s fit with your personal or business goals.

Mistake #2:  Charging Too Little

Sometimes personal chefs just don’t charge enough for the time and effort that goes into servicing a client.

A great way to determine if you are charging too little is to pay attention to how you feel after a cook day or catering event.  If you feel any sense of resentment or disappointment because the amount of money you earned doesn’t feel like enough given all the time, energy, great food and wonderful service you have just provided your clients, then you are probably not charging enough.

Also make sure you don’t do more than what was agreed.  Sometimes personal chefs have very needy clients who ask for extra services that fall well outside the contract or agreement.  When this happens, it is important to remind your clients what is provided by your services, and if you want to do anything that falls outside of your service agreement, be sure to ask for extra compensation.  Now this doesn’t mean you can’t sometimes go the extra mile once in a while for one of your best clients without compensation but don’t make a habit of it.

Mistake #3:  Agreeing to Barter

There are a few situations when bartering may make sense, but usually it doesn’t and too often I see personal chefs use bartering for the wrong reasons.  They’ve decided to barter because they have some kind of deeper fear or issue related to money.  They are approaching the potential business relationship with a scarcity rather than a prosperity mindset.

For instance, personal chefs usually choose to barter because either one or both parties believe they don’t have enough money to pay for the services they want because they are feeling a sense of scarcity when it comes to money.  Consequently, they try to come up with a fair exchange of services to get what they want without using money.

However, it is often difficult to come up with a fair exchange of services, and this is one of the reasons why bartering can leave one or both parties angry and frustrated in the end.  But let’s assume for a moment it is possible to do and everyone is happy with the arrangement.

I would then argue that there is no reason why both parties can’t pay for each others’ services using money if the value of the services being exchanged is truly the same.  Neither party will be better or worse off financially in the end.  And by using money as the expression of the value of the service, there is a lot less chance for misunderstandings or misgivings to take place.

In addition, I bet each party will feel as if the value of what they are doing is being recognized and valued more when money is exchanged which in the end will help to increase the feeling of prosperity that you have.  When you’re feeling more prosperous, you are likely to attract even more money and prosperity going forward.

A Way to End Your Money and Pricing Struggles for Good!

Do you struggle when it comes to figuring out what to charge for your personal chef services?  Do you freeze and become anxious whenever you have the money conversation?  Are you tired of hearing the words “I can’t afford your services?” and you wonder if you should be doing something differently?  Are you ready to break through your money and pricing roadblocks once and for all?

TopSecretsAd_CoinsIf you answered “yes” to any of these questions, you’ll want to check out the Top Secrets to Charging More and Getting It! free training I will be leading on June 12 by visiting http://www.chefindemand.com/pricingsecrets/chargemore.  We’ll be talking about the above mistakes in more detail plus a whole lot more.