All of us struggle with pricing at some point in the life of our business. Many of my clients, especially the small business owners, are struggling with pricing right now as COVID-19 moves to its next phase and the price of everything continues to increase, pricing is front and center. There’s a sense that the airlines and some other businesses are trying to make up for the last 18 months with excessive price increases. Others of us who are aware of the dilemma that many of our customers are in financial distress, take pause. And yet, the cost of doing business and living is on the rise by leaps and bounds. So this blog is a reminder of things to consider.
Pricing is a combination of the cost of doing business and what the market will bear. As the age of micro niche has come into full effect, I consider how it has become increasingly important to:
- understand where your ideal customer lands on the pricing and economic spectrum,
- avoid minimizing the value proposition and impact of your product or service, and
- keep scanning the marketplace to see what others are charging for the same or similar products or services.
Next,I run the numbers, and I suggest that you do the same. So, Ask yourself these questions:
- What does it cost to deliver the product or service including overhead?
- What does it cost in terms of time and real marketing costs to acquire that next set of customers?
- What is the impact of not raising my prices?
- When is the best time to raise my prices?
Then I experiment with where pricing changes will impact my goals and profitability.
Pricing is as much art as it is science and math. If you are struggling with pricing, now that everything is opening back up, let’s talk. Use this link to schedule a consultation.