Inside Strategic Coach with Dan Sullivan

Key Takeaways on Pricing for Entrepreneurs

Introduction

• Host: Shannon Waller
• Discussing Dan Sullivan's unique approach to pricing
• Pricing is a major concern for many entrepreneurs

Dan Sullivan's Take on Pricing

• New book on capitalism breaking it down into a five-part method
• Five-part process (5 Ps of Capitalism):
  • Pricing
  • Property
  • Productivity
  • Profitability
  • Prosperity
• Key focus: Pricing lies in the aspirational future of clients

Common Pricing Issues

• Most people have their pricing determined by employers
• Employment mindset doesn't involve negotiation
• Entrepreneurs must learn to price their time and talent independently

Shifting Mindsets for Entrepreneurs

• Moving away from competitive pricing
• Engaging with clients who see price as an investment, not a cost
• Ambitious entrepreneurs often see value in solutions like Strategic Coach

Strategies for Effective Pricing

• Focus on Unique Value
  • Unique offerings lead to less competition
  • Differentiation via unique thinking tools and support
• Psychological Aspect of Pricing
  • All pricing is negotiable and psychological
  • Value based on client's future ambitions
• Selling the Future, Not Just Products
  • Emphasize the future potential and happiness rather than the cost

Practical Steps for Entrepreneurs

• Focus on specific check-writers (clients) and their future ambitions
• Ask clients what must happen for them to be happy with their progress
• Offer a unique relationship and future-oriented value proposition

Dan's Pricing Formula

• Develop comfort with higher pricing over time
• Pricing should incite confidence, even if it scares you initially
• Formula: "Price that scares you + 20%"

Case Studies and Examples

• Mike Trout's Contract: Psychological value in major league sports
• Business valuations often have a wide range based on future potential
• Entrepreneurs should avoid making comparisons and instead focus on unique value creation

Summary

• No 'right' price exists; it depends on the unique value provided for someone's unique future
• Entrepreneurs need to develop confidence in their value proposition and pricing strategy
• Success comes from focusing on unique abilities and client-specific futures, not competition