Price Setting & Income Inequality

I recently had an exchange with someone who objected to my offering facilitation training for a set fee, and the conversation raised issues I thought worth exploring.

My critic was concerned about income inequality—which I am as well—essentially making the case that people ought to pay more equally in terms of what they could afford (the idea, roughly, being that someone making $25,000 annually should pay half of what someone making $50,000 annually should pay). In his view, sliding scales do the trick and he strongly advocated that I adopt that approach.

While I try to be sensitive to the social change implications of my work in the world, I'm not so enamored of sliding scales as the solution.

My critic pointed out that setting fees at a fixed amount effectively offers well-off folks a discount at the expense of those less well off, since a set price is axiomatically a smaller fraction of assets for those who are better off. While I follow this reasoning and agree that a sliding scale offers some redress, I've come to favor a different approach. Following are various considerations that led me there.

1. In my experience, sliding scales tend to suppress net revenues. That is, the amount offered above the target average does not tend to cover the deficit of those who are paying less. And it complicates knowing when I have a enough students to have a viable class. (That is, the amount I pay Amtrak to get to and from a training location does not vary by how many students I have, but if the amount each student pays is variable you cannot equate a certain number of students to an income-projection.)
2. I like setting the price for my services such that I think it's serious money yet still a clear value. There's nuance in doing this that gets watered down with a sliding scale. (My critic was advocating for a slide where the top is five times the bottom; if I went with that, the top would be embarrassing for me to ask for, while the bottom would devalue what it's worth.)

Part of what I'm concerned with is being a market-maker in my field—setting a standard for the value of high-quality process consulting. A generation ago, when I first got started, there were few practitioners and no common understanding of the value of the work. In addition to establishing a viable business for myself, I've been increasingly interested in making it easier for my students and those who follow to be able to make decent money. With a sliding scale, you are leaving a smear; not a clear mark.

3. I've found it valuable to encourage students to get organizational support for facilitation training, and I believe a sliding scale undermines the motivation for participants to seek this out. (If a person gets a price that's acceptable via a sliding scale, why bother to ask others for support?) 
To be fair, my critic points out that the extra work of enlisting organizational support falls unevenly on those with less income, as the better off are less likely to need help. Still, I prefer this for two reasons: a) it secures support for those with less income other than by my accepting discounted compensation; and b) it enrolls more parties in the investment of process training. If organizations subsidize the training they'll be more inclined to us it, helping to impact the whole organizational culture—which is a prime objective for me in offering the training in the first place.

4. I've worked hard to create a facilitation training model that keeps costs to a minimum (food and lodging for students are exchanged for outside facilitation) and fees go solely to compensate the trainers. In addition, we offer thinking and assistance for students to get financial support from cooperative groups with which they are affiliated (perhaps in exchange for a commitment to practice their new skills or to teach others what they've learned). If that's still not enough, I try to work out a barter in exchange for lower fees.

This mixture maintains the integrity of the price, while creating a viable safety net for those who truly want the learning yet find the price beyond their means.

5. My observation is that people tend to value a thing in proportion to what they pay for it. While I wish this weren't so (and I get the opportunity to work my side of this equation by paying no attention to how much a student or client pays when giving them my attention as a teacher or consultant), I have encountered this too many times to ignore it. People who get a thing cheaply, tend to value it cheaply, and I detest working hard for a client only to have the group respond indifferently because they paid little or no money for the offering.

Thus, I prefer establishing a clear non-trivial marker for value, and then creating numerous ways for people strapped for financial resources to be able to bridge to the opportunity. Does this make it possible for everyone to have straight-forward access to what I offer? No. My approach requires a certain baseline ability to be self-motivated, and an ease in asking others for support (because is is not just handed out), and I'm OK with that.

6. Sustainability is a major catchword these days. For most of my professional life I'd say my work fits under the subheading of social sustainability—what does it take for people to live together closely and happily in cooperative culture, given that we've been raised in competitive culture? In recent years, however, I've expanded my focus to embrace various aspects of economic sustainability—how do we fairly and honorably exchange goods and services such that people are operating in integrity yet are not expected to be wholly self-sufficient?

In this vein, I want to operate as a process consultant in such a way that encourages people to do personal work in relation to the meaning of money in their life—which, I believe, many of us have not done. If I offered a sliding scale for my services, people would have to determine where they fit on the scale, yet I'm not convinced that that examination would go much deeper than comparing their bank account with their sense of fairness. While that's not a bad thing, I want something deeper.

I've been doing that work on my end, and I'm OK asking that others meet me there. If they want my services and don't see how they can afford me, I'm willing to roll up my sleeves and be an ally in helping them find a mutually acceptable solution. I'm just not willing to start by offering a discount.