PRIVATE HEALTH PRACTICE BUSINESS COACHING Blog

The High Cost of Low Rates: Why Getting Paid Well is Key to Private Practice Success

The High Cost of Low Rates: Why Getting Paid Well is Key to Private Practice Success

You’ve spent countless hours building your business and attracting clients to your private practice. While we usually think about lead generation or marketing opportunities, we often overlook our pricing strategy. Getting paid well for your services isn’t just good for business — it’s essential to long-term success.

Setting fair and profitable rates is critical regarding the profitability and sustainability of your private practice. It can mean the difference between trading dollars for hours and resenting your business versus having a profitable practice that supports the financial freedom and lifestyle you deserve – and even saving some for retirement!

Unfortunately, many private practitioners hesitate to raise their rates or charge what they’re worth. They may fear losing clients or worry their rates are too high for their target audience. 

It’s important to remember that getting paid well not only supports the growth of your business but also provides you with the freedom to focus on what truly matters – serving your clients and building a thriving practice that allows you to live the life you want.

If you’re like me, when you started your business, you likely did it with a purpose and a passion for helping people. 

Unfortunately setting low rates is a common trap that can quickly lead to doubts and second-guessing the decision to start your business in the first place. 

Doubt creeps in and you start asking yourself, 

“Are I fulfilling my purpose?” 

“Was this a huge mistake?”

Sound familiar?

You don’t have to choose between success in your private practice and doing meaningful work. You deserve to be paid well for the quality services you provide—and you don’t have to sacrifice your values or put yourself in an unprofitable position to do so.

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The first thing to do is remember why you started in the first place. 

Don’t let the fear of not getting clients hold you back from setting fair prices that will lead to the fulfilling and sustainable business you deserve. According to Inc.com, fear is the #1 reason business owners don’t raise their prices. Many businesses wait for years before making any adjustments to their prices!

By charging fair rates that reflect the value of your education, specialty, location, and business goals, you can attract higher-quality clients willing to invest in themselves. A good pricing strategy can also help level out seasonal lulls in business and ensure a steady client base throughout the year.

I’ve struggled with pricing strategy more than I’d like to admit so this topic is close to my heart. 

In this post, we’ll explore the high cost of low rates for health professionals in private practice and why setting fair prices is vital to achieving success. We’ll discuss the importance of pricing strategies, bundling offers, and the pros and cons of offering discounts. For inspiration, I’ll also share a real-life success story of a dietitian I’ve worked with who has increased her rates and is thriving thanks to her new pricing strategy.

The Consequences of Low Rates

While setting low rates so everyone can afford to work with you is tempting, undercharging your services has severe consequences. Low rates can lead to burnout, resentment towards clients and your business, financial insecurity, and an inability to reinvest in your practice or save money for retirement.

Besides your financial compensation, low rates attract low-quality clients and “tire kickers” – these folks who generally aren’t invested in achieving results. These clients are likelier to cancel appointments or not show up, leading to lost time and revenue.

Additionally, low rates can give the impression that your programs and care provided are low-quality or not worth the investment. With referrals being a critical factor in the success of private practices, this can have lasting consequences for your reputation.

On the other hand, setting fair and profitable rates can attract clients who are more emotionally invested in their results. According to the Harvard Business Review, clients who pay more are more likely to stay loyal and invested in their progress. These clients are more likely to commit to the process, show up for appointments, and refer others to your business. 

How to Decide on Your Fees

Pricing is almost always a hurdle we face as entrepreneurs. While there are no hard and fast rules, there are a few things to consider, such as your expertise, experience, and the needs of your target audience when determining your fees.

Ask yourself:

  • What makes your practice unique?
  • What problems do you solve for your paying clients once and for all?
  • How does your experience and training help you stand out from the competition?
  • What makes people decide to work with you?
  • What tools or modalities are you using to generate results?
  • How much is your time and expertise worth?
  • What amount of money or payment feels good to you?
  • What price can you confidently offer without feeling like a fraud?

Remember, feeling good about what you charge is vital to confidently closing sales calls and attracting the right clients.

There’s no rush to the finish line when it comes to deciding your rates and nothing is set in stone. You can always change your prices in the future so don’t get hung up on perfection. If you’re still stumped, ask for feedback in my Multiple Streams of Income Facebook group exclusively for health professionals. 

Key to Getting Paid Well in Your Private Practice: Bundling Offers and Discounts

One effective pricing strategy for health professionals in private practice is bundling offers and providing discounts.

Imagine you’re at a restaurant, and the menu offers a combo meal with a drink, entree, and dessert for a discounted price. You’re more likely to choose that option than to order each item separately, right? The same principle applies to bundling offers in private practice. For example, offering a package deal for multiple sessions can encourage clients to commit to a longer-term relationship and be more emotionally invested in their results.

But what about discounts? Should you offer them or not? 

Although they can help attract new customers, they also have certain drawbacks. Offering discounts too frequently or steeply can make your services appear lower quality or undervalued. However, when used effectively, discounts can be a win-win for you and your clients. For instance, offering a referral discount can incentivize clients to spread the word about your services, leading to more business for you.

So how do you know when to offer discounts and how much to give? It’s essential to consider your client’s needs and preferences.

  • Do they value convenience and simplicity? Consider bundling offers. 
  • Are they price-sensitive or looking for a deal? Offer a limited-time discount. 

When deciding on your pricing strategy, consider your target audience and what will motivate them to invest in your services. 

As a private practice business owner, it’s important to remember that pricing isn’t a one-and-done decision. 

You can experiment and adjust your pricing strategy as you go. For example, you might mean raising your rates to reflect your high-quality services or bundling them to make them more convenient and appealing to clients.

It’s also essential to consider your client base’s unique needs and preferences when adjusting your pricing. Consider what your clients value most and how you can tailor your pricing to meet those needs. 

Have fun and experiment with your pricing and service offerings until you find the right balance that works for you and your clients.

Case Study: How Brittyn Tripled Her Income and Created a High-Value Signature Program

Meet Brittyn, a dietitian who was feeling overwhelmed and exhausted from constantly trying to book clients without much success. When she reached out to me for coaching, she was hoping to find a way to increase her income and create a high-value program that would benefit both her and her clients.

During our first call, Brittyn shared her struggles with me and how much she wanted to create her own signature program. With my guidance and support, she was able to develop a program that truly reflected her expertise and value proposition, and she was thrilled with the results.

Brittyn also re-evaluated her pricing strategy and increased her rates, which led to astounding results. Within 45 days of working together, she tripled her income and made back her initial coaching investment with me, all while providing high-value services to her clients.

The high-value program that Brittyn created allowed her to support herself financially while also providing an unparalleled service to her clients. And with the added confidence and encouragement from our coaching sessions, she felt like a rock star and was ready to take on anything.

Brittyn’s success story demonstrates just how essential it is to set fair and profitable rates for your health business. By increasing her rates and creating a high-value program, she achieved financial stability, and professional growth, and provided invaluable service to her clients.

So what can we learn from Brittyn’s success story? Here are some key takeaways:

  • Don’t undervalue your worth: Brittyn realized that her expertise and experience were valuable assets that deserved to be compensated appropriately.
  • Set ambitious goals: Brittyn didn’t just raise her prices a little bit – she doubled them. This bold move paid off in a big way and opened up new opportunities for growth.
  • Focus on quality, not quantity: By attracting higher-quality clients who were invested in their results, Brittyn was able to work smarter, not harder, and achieve financial stability.
  • Re-evaluating your pricing strategy and increasing rates can lead to significant income growth.
  • Confidence and encouragement from coaching sessions can have a significant impact on success.

What could you accomplish if you followed Brittyn’s example and focused on creating a high-value program and setting ambitious pricing goals for your private practice? It’s usually scary to take that leap, but the rewards could be life-changing.

Setting Fair Prices: The Key to Building a Thriving Private Practice

In this post, we’ve explored pricing strategies for private practice professionals, including setting your prices at a competitive rate, bundling offers, offering discounts, and raising rates to reflect the value of your expertise and experience. We’ve seen how these strategies can increase revenue, attract higher-quality clients, and encourage long-term relationships.

It’s crucial to set fair and profitable rates for your private practice to achieve financial stability, professional growth, and emotional investment in your work. It’s also essential to be aware of your competition, target audience, and market rates.

Successful private practitioners have taken the time to craft pricing models that work for them and their clients. They understand that setting fair prices is vital to building a thriving private practice. By following Brittyn’s example, you can take control of your success story and create the life and career you want.

The Downside of Attracting Low-Quality Clients

Building your private practice is hard sometimes. It’s only natural to want to attract as many people as possible. Attracting low-quality clients can be a double-edged sword that can hurt your business in the long run. 

While setting low rates may seem like an excellent way to build your business, it only attracts people who are not invested in their results and want a lot of upgrades for free. They don’t see the value in your expertise and experience and are likelier to cancel appointments or not show up. That means lost time, lost revenue, and virtually zero referrals.

Even if you provide excellent care, clients may perceive it as less valuable because of the low rates! which can lead to a lack of interest from potential star clients willing to pay a premium price for high-quality care. This is especially true in the healthcare industry that we’re in, where our ideal clients are looking for the best care possible.

It’s essential to understand that attracting high-quality clients takes time and effort. It involves creating a solid brand, building a reputation, and providing exceptional care consistently. It’s about showcasing the value of your services, demonstrating expertise, and creating a top-notch client experience. 

Remember, building a successful private practice takes time and effort, but with the right strategies and support, you can create a thriving business that provides excellent care to your clients.

Pricing Strategies for Successful Private Practitioners

I encourage you to experiment with different pricing strategies and see how they affect your business. Don’t be afraid to try something new and take calculated risks. 

Remember that setting fair and profitable rates is essential for the growth and sustainability of your private practice. 

Remember the lessons from Brittyn’s success story, and always be willing to evaluate and adjust your pricing strategy as needed.

If you’re interested in learning more about pricing strategies for your business, book a call with me or enroll in one of my courses or coaching programs

Together, we can work towards building your thriving and profitable private practice and create a pricing strategy that aligns with your values and goals. 

My coaching programs offer personalized support and guidance tailored to your unique needs, and I’m here to help you every step of the way.

Remember, investing in yourself and your business is always worth it in the long run. So, take the first step today, and let’s start building the private practice of your dreams.

Lesli Bitel, MBA, RDN, LDN, is a sought-after Business Strategist and Mentor specializing in guiding integrative and functional medicine professionals through the complexities of practice building.

Her mission is to unravel the confusion associated with the business side of running a successful private practice. Lesli focuses on real-world marketing and client attraction strategies to seamlessly integrate multiple income streams into the private practice business model, including

  • 1:1 coaching to online courses
  • Group programs
  • Online courses
  • Passive income products
  • Memberships
  • And more

In her work, Lesli draws on her experience running her own 6-figure functional nutrition practice, specializing in helping patients with neurological disorders. She also has a 13-year tenure in the pharmaceutical and diagnostic testing industries, where she excelled in marketing and sales, eventually reaching high-level executive roles.

For over a decade, she has empowered practitioners to overcome business challenges, attract ideal clients, and diversify income streams for thriving practices. Lesli offers private coaching, classes, webinars, and more, dividing her time between Salida, CO, and Lake Geneva, WI.

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