Do your prices reflect what you think customers are willing to pay, or what you’re actually worth? Here’s how to make sure you’re not selling yourself short.
Many small business owners go into business to make money and support their families by doing what they love. Trouble is, once in business, they charge less than they’re worth thinking they’ll attract more customers and build their business quicker. But it can do more damage than good.
Pricing is a part of our branding after all. It sends a message to our potential customers about the value of our products and services and the level of our experience and expertise. Customers don’t expect to pay bargain basement prices for high quality products and services. So here are five tips to help you make sure you’re charging what you’re worth.
1. Value yourself and what you do
When what you do comes so easily to you, it can be hard to believe that someone would pay you good money to do it for them. But for others to value you, you first need to value yourself and what you have to offer.
Listen to your clients’ feedback, look at the results you generate for them and take each referral you are given as proof of the good work you’re doing. Start valuing what you do and charge accordingly, and soon you’ll see there are others who value you too.
2. Work out how much it would cost to replace you
If you want to put a real value on your time, work out what it would cost to hire someone to do everything you do in your business. You will soon see just how much your time is worth and how valuable you are to your business.
Want more articles like this? Check out the pricing strategy section.
3. Compare your pricing to your competitors
Do some research into your competitors and compare your pricing to those who have similar experience and expertise as you. If you find you are below the asking price of many of them you might want to rectify that – and quickly.
The last thing you need is a potential customer thinking your products and services are less valuable than your competitors.
4. Work out the value you offer
To make sure you are charging what you’re really worth, look at your products and services and determine the value you give to your clients. What benefits do they gain? What results will they experience? How often will they use what you have produced for them? What specialised skills and knowledge are you providing them with?
Start charging based on the value your clients will receive from your products and services. If your customer has the potential to gain great benefit from you, then charge a larger amount. Your clients will expect to pay more for bigger benefits and will be happy to pay more if the value is there.
5. Determine what you need and want to earn
Instead of being limited to only earning a certain amount per hour (remember, time is your most limited resource – you will only ever have 24 hours in a day) take a more entrepreneurial approach and determine what you need to earn and want to earn, and then develop and sell products or services to help you achieve that figure.
When you start to charge what you are worth, you’ll find something incredible happens: you’ll attract better clients – clients who see the value in what you provide and are more than happy to pay your bills.
So today, take a look at your pricing strategy and be honest with yourself – are you really charging what you are worth? If not, start valuing yourself and give yourself a much-deserved raise!
Do you charge what you’re worth and, if so, what is the response from your clients?