Does this sound like you? You offer great quality service, you have an excellent customer base, but you’re still making very little, if any, profit. There could be many reasons for this, but one of the most frequent is that you’re not charging enough. Here’s how to stop under-valuing yourself and get the money you deserve.
Find out what’s behind your excuses.
Right about now, you’re probably thinking that you charge as much as your customers will tolerate. But if your competition is charging more, what’s the real reason for your low prices? Consider these possibilities:
- You’re insecure about the quality of your skills or service
- You haven’t added up all the benefits your client receives
- You haven’t analyzed your competitive advantages and differentiators
- You work extra long hours without getting paid extra
The vicious cycle of low pricing.
When you underprice your services, there are more consequences to your business than minimal profit margins. The more you lower prices, the worse your business gets, and the worse your business gets, the more you’re forced to lower prices.
- You attract problem clients who will nitpick, disrespect your expertise and try to drive your prices even lower
- Problem clients create an environment that repels good clients
- You have no room in the budget for promotions and marketing, which attract more — and better — clients than low pricing does
- Talented staff don’t want to work for you
6 steps to getting the prices right.
- Work on your personal attitudes to self-worth and wealth acquisition, which may date back to childhood.
- Do a competitive analysis: the benefits you bring to clients and ways that you’re different/better than competitors. If you can’t think of any, plan how you’re going to change that.
- Immediately raise your prices to new clients by 20%. Transition existing clients more gradually. See how that works for a few months, then adjust as necessary.
- Charge overtime for excessive demands for your time and talents; or just say no.
- Make a marketing and promotions plan to attract new, quality clients.
- Bring in experts to support your weak areas, such as accounting or marketing.
Valuing yourself at your true worth isn’t just good for your soul, it’s good for your business. Get started on these tips today — you deserve it!