November 11, 2026

Couldn’t Alice just raise her rates?

In response to yesterday’s message, a few alert readers wrote in to ask some version of the following question:

But if Alice’s team got faster, couldn’t she just raise her hourly rates?

In theory, she could.

But she won’t.

But even if she did, she almost certainly wouldn’t increase it enough to compensate for her team’s increased productivity.

But let’s say she DID increase it enough to compensate...

Then her hourly rate would be at least 2-3x higher than her competitors, which would make it very hard for her to retain existing clients or close deals with new clients.

Hourly billing punishes efficiency.

There’s no way around it.

Yours,

—J