Sliding Scale Pricing -- Why I Don’t Recommend It

Over the years I’ve noticed many solopreneurs experiment with sliding scale pricing or pay-what-you-can (PWYC).

I respect their compassionate intentions!

However, I don’t feel it’s a good method for most soulpreneurs.

While seemingly generous, these pricing schemes can create more problems than they solve.

While there might be exceptions, I believe most of us would build more sustainable businesses and serve our clients better with simpler, more transparent pricing structures.

The Burden on the Buyer

The core issue with sliding scale or PWYC is that it shifts the pricing responsibility onto the buyer.

Potential clients are already navigating a complex landscape of marketing messages and “buyer beware” scenarios. They’re working hard to discern if a product or service truly meets their needs.

Adding the task of determining the “right” price on top of this decision fatigue feels like an unnecessary burden…

For many heart-based clients (like the ones I have), who are especially mindful of the service provider’s well-being, sliding scale introduces an extra layer of pressure. They worry about paying fairly, both for themselves and for the business’s sustainability.

This is especially pronounced in direct interactions with the provider, where concerns about causing offense by paying too little can arise.

Cultural nuances amplify this — in many cultures, avoiding offense is paramount, making price negotiation emotionally taxing.

Beyond the worry of offense, sliding scale can also trigger a “deal-seeking” mentality. Customers might become preoccupied with finding the lowest acceptable price.

This can lead to internal conflict and potential dissatisfaction, regardless of the price they ultimately pay.

For example, years ago, shortly after college, there was a vegetarian restaurant in my neighborhood that had PWYC (pay what you can) pricing.

The menu, devoid of prices, induced anxiety…

To avoid appearing cheap and to ensure the restaurant’s survival, I consistently overpaid (around $20-$25 per plate when comparable restaurants charged $12-$15). I did this even when my own finances were tight.

This highlights how PWYC can backfire, causing customers to pay more than they might have with fixed pricing. This is driven by anxiety and a desire to “do the right thing.”

Sliding Scale Resentment

While sliding scale, often linked to income level, seems more structured than PWYC, it still carries risks. These include negative feelings and unintended consequences…

Imagine a client with a higher income who simply appreciates a good deal. They might resent having to pay more when a lower price is available. This can feel particularly unfair in some cultures.

Or what if you discover a client used the lowest end of the sliding scale based on technically low income, but the reason they’re not earning much income right now is that they are actually retired and financially independent? Or perhaps they have significant family support?

Interestingly, I’ve observed that those with substantial financial resources are often the most adept bargain hunters. Meanwhile, those with less financial security might be more inclined to pay full price.

The truth is, many clients, regardless of their financial situation, may not fully disclose their financial realities.

Furthermore, how do clients paying different rates perceive each other? The potential for misunderstanding and emotional entanglement is significant.

For solopreneurs and small businesses, this complexity can be overwhelming.

A reader asked: “What do you think about sliding scale that has clear guidelines about who might fit in lower, middle, and top end of the range? For example — ‘As a guideline, the bottom end of the scale is for folks who regularly struggle to come up with their rent’ or ‘The top end of the scale is for those who regularly spend more than $40 on a meal’ etc etc…”

While I appreciate the compassionate intent behind such guidelines, I still find them problematic.

Some individuals struggling with rent might occasionally spend $40+ on meals. While some with high incomes (like myself) rarely spend that much on a single meal, or only for special occasions.

Moreover, if I knew a client was struggling with rent, my instinct would not be to offer a sliding scale, but instead, I’d want them to access free resources… directing them to relevant blog posts or one of my many videos that they can take their time with.

Also, having experienced financial hardship myself early in my career, I wouldn’t have wanted to reinforce a “struggling” identity by accepting discounted pricing.

Perhaps a middle ground, instead of publicly advertised sliding scale, is to offer it privately, on a case-by-case basis. This allows for compassionate pricing adjustments without the public complexities and potential for resentment.

A Healthier, Tiered Alternative

Instead of PWYC or sliding scale, I recommend a tiered service/product model. This ensures business viability and broader accessibility.

Offer a range of options at different price points. For example, you might have 1-on-1 services at $150/hour, group programs at $50/month, online courses from $50 to $500, and books from $5 to $20.

This structure naturally accommodates various budgets, making your offerings accessible to a wider audience. This extends all the way to free content.

For more about this, read this blog post — Concentric Circles Business Model.

Fixed pricing at each tier isn’t about exclusion; it’s about clarity and boundaries. It guides clients to make informed purchasing decisions. It guides us to invest the appropriate amount of energy per client at the various levels.

For newer service providers, another helpful approach is my “tapering strategy”. Read about it here — Tapering Strategy for Solopreneurs.

This allows you to gradually increase your prices as you gain experience and confidence. It offers more accessible entry points initially.

Furthermore, by building connections within our niche, we can create an ecosystem of service providers at different price points.

This allows for referrals based on client needs and financial capacity.

To those who argue that tiered offerings reinforce inequality, consider a deeply admired teacher or mentor — would you want their income to fluctuate based on their students’ financial situations? I believe most of us would want our service providers to thrive financially.

Another reader shared their experience: “I used to see a bodyworker who transitioned to sliding scale and it did put a lot of burden on me. I did not want to be the one deciding for the practitioner what his time was worth, or what was right for his business. I hated it. I saw him less because of it.

We ended up becoming friends and talked about it years later. He told me he thought I was the only client he had who was comfortable with it. That basically people he thought could likely afford a higher amount, often came more often and paid the least and those who struggled often waited and paid more.

He thought I was comfortable with it because I paid differing amounts. I paid differing amounts because it was my personal “F U for making me do this.”

I only did this with him because I really valued him as a practitioner and as a person after seeing him for flat rates before he changed. I would never choose a coach or practitioner who had this as a policy.”

This anecdote powerfully illustrates the unintended consequences of sliding scale, even for well-intentioned practitioners. It shows how the burden of choice can negatively impact the client-practitioner relationship.

Yet another reader commented: “I tried it (sliding scale). I think it makes things really messy & uncomfortable for clients. Any time it’s been an option for me, I generally pay the full price and then feel like that sucker who didn’t pay less. I was also left wondering if it was actually worth the full price when every one else likely payed less. Gah. I’d rather just have different things at different price points. People can enter at the price/level that works for them. I will add, the folks who I paid this way, really believe that it is the best way and that they are doing it well (it is something they teach). As the consumer, it didn’t feel great.”

If we truly want to be compassionate, we’ll focus on offering scalable free resources and strive to keep our overall prices accessible — and consider giving profits back to customers, through something like an affiliate program, as I do.

Sustainable Compassion: Giving Back Profits

I deeply admire and value compassion in business. However, I believe we need to channel that compassion in sustainable ways.

These ways should support both our businesses and our clients. We need to model pricing strategies that ensure the viability of small businesses.

For me, this means keeping pricing simple, transparent, and free from potential misunderstandings or negative emotions.

This allows us to dedicate more energy to providing excellent service and creating valuable free content — content that is accessible to everyone, regardless of their financial circumstances.

Instead of sliding scale or PWYC, my preferred approach is to prioritize giving back profits.

I aim to pay myself a sustainable wage and then share profits with clients and students through my affiliate program.

Profit-sharing is a deeply rewarding aspect of my business. If you’re interested, learn more about the George Kao Affiliate Program.

By focusing on clear, tiered pricing and profit-sharing, we can build businesses that are both financially sustainable, and feels generous. These businesses can serve a wide range of clients, without the complexities and potential pitfalls of sliding scale pricing.

Originally written in 2022. Updated in 2025.