phoenix845•2mo agoTop Commenter

My agency just hit 40% profit margin for the first time

We've been running at around 25% for years, so seeing that number on our Q3 report was a shock. I think the big change was switching to value-based pricing on our web design projects instead of hourly billing. We also cut two software tools that weren't being used much, saving about $400 a month. Has anyone else made a pricing shift that led to a big jump in profits?

3 comments

3 Comments

casey_campbell2mo ago

Yeah, switching to project-based pricing was the single best move we made. We stopped selling hours and started selling the end result, like a website that converts at a certain rate. Clients stopped nickel-and-diming every change, and our average project value went up by about 60% because we were finally getting paid for our expertise, not our time.

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harperc792mo ago

Sounds good but scope creep is still a real problem. You can sell the end result but clients always want just one more thing. Gotta have a real tight contract or the project price doesn't matter.

the_eric8d ago

Yeah, @harperc79, I used to think the same way but this totally changed my mind.