Pricing is one of the most difficult things to figure out when you are running your business, but I also think that many of us are under the definitely false impression that if we charge less for our services that we will get more clients and make more money.
When I was running my web design business I would find that if I took on a project at a discounted rate, it would mean that I didn’t have time to find clients at a higher rate and also, people who pay less, still want the same level of service – so it is a false economy to fill up your time working with people who aren’t really able to afford you.
My big epiphany was when I realised that I was marketing to the wrong audience. One of the keys to creating a successful business is to be selling your products and services to those who can afford it. By creating enough value in your business and your offering and targeting the right customer base you can transform your business, to one that is thriving and profitable.
In the video below I share the 5 signs that you are too cheap and would really like you to think about whether you can take away any ideas or inspiration for your own business.
5 Signs that you are not charging enough!
1. You’re too busy
If you are working loads and not rolling in dough, then odds are you are not charging enough. If people value what you have to offer, they will be willing to pay a decent amount to work with you or buy your product. If they aren’t willing to, then perhaps it’s worth looking at how you can increase the value.
2. People tell you that you are not charging enough
Recently I had about 5 people come up to me after our business club and tell me that we weren’t charging enough for the value that they received out of the club. One person said that she almost didn’t come because she wasn’t sure that there would be enough value. If people are telling you that you are not charging enough – believe them! Look at what is going on in your marketplace and who is charging what and figure out how you can move up the pricing ladder.
3. You give your time away for free
So many women fall into this trap. We feel such a strong desire to help people out that we forget our own needs and offer to help for free. DON’T DO IT! By spending time giving away your free services or products, you are devaluing what you have to offer and you will be using the time that you are spending with them and not helping people that are willing to pay. That is not to say, that free can’t be a great marketing tool, but to be effective, it needs to be leveraged, meaning that it is helping out loads of people, not just one person.
4. You only have 1 price point
Have three different types of offering around the same product. A basic, middle and premium option. Think about the different types of value that you can offer. And, if you’re anything like me, you’ll always want to give as much value as you can – but the problem is, that often, people only want one element of that. You’ll be amazed at how many people will go for the premium option and it is guaranteed to bring in more revenue into your business.
5. You allow yourself to be negotiated down
Move away from financial discussions and offer a value exchange instead. If someone wants to pay you less, then you give them less value. You know the value of what you have to offer, don’t let others take that away from you. Find a way to give them an additional piece of added value that will not cost you time or money to deliver.