One of the key steps on the route to having a calm and healthy agency is to have, and be able to justify, premium pricing.
That gives you enough margin to really invest in talent and professional development, in evolving the agency by placing research and experimentation bets to explore what's ahead, and in developing systems and processes to support the work.
It also means you can build up a good enough cash buffer to ride out the tough times.
And you, as the leader, are able to spend more time on the high-altitude long-term leadership of the agency, rather than having to be firefighting all the time.
So by charging more, your agency is able to become better for clients — and worth more money.
Conversely, if you compete directly on price or simply let your offer become commoditised (where clients see your offer as being so similar to others that price is a key factor in their procurement), your margins become squeezed. This leads to you seeking cheaper staff, cutting investment in training, and having low cash reserves.
This in turn leads to your attention as a leader being very short term and low level. It becomes more stressful and time consuming.
These are known as the virtuous and vicious cycles of pricing, respectively.