If you’ve transitioned into coaching full-time, pricing strategy is probably at the top of your mind. This field isn’t like a traditional nine-to-five where you’re clocking in and out. Now, you’re the boss who gets to set the rules. That freedom is beautiful, but it comes with challenges like figuring out your optimal rates.

This article will give you the rundown on business coaching pricing strategy while helping you find a sweet spot in your rates.

4 Pricing Strategies for Business Coaching Rates

There are four main pricing strategies available to fit the varied needs of business coaching. Explore these most common pricing models below. Remember that you can use a combination of models and can transition from one to another as your business matures. 

1. Hourly Rates 

Charging by the hour is one of the most straightforward pricing strategies. It’s transparent, easy to calculate, and ensures that you get compensated for each minute you spend coaching. The focus is on the time spent during sessions, and it’s easy for clients to comprehend. This strategy benefits coaches with variable workloads or who offer specialized consultations that require deep preparation or follow-up.

With this model, clients know exactly what they’re paying for, and coaches get compensated fairly for their time. There’s no ambiguity, which is often appealing to both parties. Additionally, this model allows for flexibility. If clients want to extend a session on the spot because they’re deriving significant value from it, they can easily calculate the additional cost.

Disadvantages of Hourly Rates

Hourly rates create a ceiling for your income since there are only so many hours in a day to coach. This model also focuses squarely on time rather than the value you provide, which will devalue your expertise in clients’ eyes. 

There’s also the administrative hassle of time-tracking and billing by the hour, which can become overwhelming. Lastly, hourly pricing can discourage long-term commitment from clients, as they may opt for a la carte sessions, affecting your ability to forecast income and plan accordingly.

Example of Hourly Rates 

Let’s say your standard hourly rate is $100. If a client books a session for 90 minutes, you will multiply 1.5 (the number of hours) by $100, leading to a total charge of $150. This rate is adjusted upward or downward based on the complexity of the coaching needs or any extra materials or preparation time involved.

Worksheet: How to Calculate Your Business Coaching Rates
Get this free worksheet and many other templates, guides, and client tools in the Coach Factory resource library.

2. Tiered Package Pricing 

Package deals offer a set number of sessions at a discounted rate, incentivizing clients to commit to longer-term coaching. Not only does this approach ensure more consistent revenue for you, but it also fosters a deeper, more sustained relationship with your clients. A package deal usually requires an upfront payment to increase cash flow and reduce the administrative burden of billing after each session.

Disadvantages of Tiered Package Pricing

With multiple options, clients may need help deciding which package suits them best. Additionally, lower-tier packages may cannibalize sales of higher-value offerings if not structured carefully. There’s also the risk that some clients may opt for a less comprehensive package to save money but then feel short changed when they don’t achieve the results they were hoping for. This can lead to dissatisfaction and negative testimonials or reviews, harming your reputation in the long run.

Example of Tiered Package Pricing

If you typically charge $100 per session, you might offer a basic package deal of ten sessions for $900. To add tiers, increase the value equally across three package deals. The next tier would be 15 sessions for $1,300, and the highest tier would be 20 sessions for $1,700. 

This tiered offer creates the perceived value of free or less pricey sessions while you get the benefit of locked-in clientele. 

3. Retainer Rates

In the retainer rates model, clients pay a monthly fee to secure your ongoing coaching services. This agreement establishes a long-term relationship between you and the client. Within this model, clients generally expect a set number of sessions per month and other value-added services like email support, resource materials, or even emergency consultations. This model is appealing because it offers both parties financial and relational stability.

Be sure to read how Brent ‘Spillly’ Spilkin compares his coaching retainer to that of a lawyer and also to an all-you-can-eat buffet on the Coach Factory Podcast

Disadvantages of Retainer Rates

Retainers often deter new or hesitant clients unwilling to commit to a long-term financial obligation upfront. You may also find yourself locked in with clients who aren’t an ideal fit, leading to reduced job satisfaction. 

Example of Retainer Rates 

For a monthly fee of $3,000, your client receives six 90-minute coaching sessions, weekly email check-ins, access to an exclusive set of resource materials, and priority booking for additional consultations if needed. This comprehensive offer goes beyond just the hourly meeting — it provides ongoing support.

“… when I stopped thinking about hours and just focused on outcome, my whole thinking about what I was charging needed to change, because now I’m no longer counting hours.”

Howard Mann on the Coach Factory Podcast

4. Value-Based Pricing

In value-based pricing, you set your fees based on the tangible or intangible benefits you provide, not just the hours you put in. This pricing model requires a deep understanding of your clients’ pain points and goals and the unique value you offer in solving their problems. It’s an approach that requires you to clearly articulate and deliver measurable outcomes, making it more results-oriented.

retainer method is a great pricing strategy for business coaching

Disadvantages of Value-Based Pricing

Failing to meet high expectations can result in client dissatisfaction, negative reviews, and damage to your reputation. Additionally, the value-based pricing model may limit your customer base to only those willing to make a significant financial investment, potentially alienating clients with smaller budgets. Calculating the value you provide is also subjective and may require frequent adjustments based on market perception and client feedback.

“Your price becomes a reflection of the results that you create for somebody.”

Howard Mann on the Coach Factory Podcast

Example of Value-Based Pricing

A business coach specializing in reviving struggling small businesses could offer a comprehensive three-month program that promises to increase profitability by at least 30 percent. Given the significant value and potential return on investment, it would be wise to charge a premium fee of $5,000 for this program.

Avoiding the Risks of Underpricing and Overvaluing Your Coaching Services

Starting a coaching business is thrilling, but setting prices can be a real headache. If pricing is too low, you risk burnout, but if they’re too expensive, you risk scaring off potential clients. So, let’s unpack two major pitfalls of mispricing your services and explore solutions.

1. Insecurity with an eagerness to scale

New coaches often undervalue their services due to market insecurity or overvalue them based on unique selling points. Both approaches aim to attract clients quickly but can lead to long-term problems. 

To combat this issue:

  • Start with market research to understand competitors’ rates.
  • Air this with a realistic self-assessment of your skills and unique selling points.
  • Instead of rushing to attract clients with low prices or inflated rates, focus on delivering high-quality service and adjust your pricing as you gain experience.

2.Inconsistent client attraction and retention

Underpricing tends to attract less committed clients, and overvaluing aims for higher-value clients. However, both can backfire. Low-commitment clients are draining, while high-value clients are demanding and expect high return on investment for the premium they pay.

The solution lies in value-based pricing. By setting your rates according to the genuine value and unique expertise you provide, you attract a quality clientele willing to invest in what you offer. This ensures a fair revenue stream and a satisfying, sustainable coaching relationship for both parties.

So it’s an important factor to say, “Look, I’m not selling you hours here. I’m selling you an outcome. And I’m selling you this picture that we just sat for a few hours and painted.” 

Melanie Benson on the Coach Factory Podcast

Free Worksheet for Calculating Your Rates

Need help crunching the numbers for your business coaching rates? We can help! First join Coach Factory as a VIP member (for free). Then download and print the Worksheet: How to Calculate your Business Coaching Rates to guide you through the process. 

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Written by The Coach Factory Team

We're a team of coaching enthusiasts who hire and work with coaches. Members of our team run businesses in the coaching industry or provide services that support coaches, and several of us are coaches ourselves.

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