If you are looking to price your product or service then you need to consider what pricing system you are going to use.
Discounting can be a quick trip the poor house, while value creation may mean financial freedom for you and your family.
Read on to find out why your pricing strategy is so critical.
Here are 5 things you can do in order to make your small business thrive even in the toughest times, without having to discount your prices in order to get approval from the lowest-level customers.
If you price yourself into a position where you are just barely getting by, then not only will your business suffer, due to lack of overhead, but your personal life will also suffer, because there won't be anything left to take home.
Your small business pricing strategy is something that you should address as soon as you start your business.
Many of the decisions that you make in your business will be designed around this pricing strategy.
When you choose the right pricing method, you will be able to weather the storm of economic downturn much better than a business that is just trying to outbid it's competition with the best deal.
Discounting can be a quick trip the poor house, while value creation may mean financial freedom for you and your family.
Read on to find out why your pricing strategy is so critical.
Here are 5 things you can do in order to make your small business thrive even in the toughest times, without having to discount your prices in order to get approval from the lowest-level customers.
- Add value- here you are going to show your customer that the sticker price is not what they are truly paying for the product.
Maybe your product lasts twice as long, or perhaps it costs less money to use the product. - Make it scarce- If you make your product or service hard to get, people will want it even more.
Customers love to have things that the other people around them do not have. - Make it expensive- If your product or service appears to have heirloom quality, then you can charge a lot more money, giving the product the illusion of exclusivity.
- Get rid of the price buyers- Only 20% of your customers buy on price, so why bother pandering to their every need.
These people have no loyalty to your business and they will drop you in a heartbeat if they can find the product cheaper down the road. - Make it unique- If you are the only business in town that sells a certain thing, then you get the corner on that market.
You can raise your prices and those customers will keep coming back, because they want the exact thing that you have for sale.
If you price yourself into a position where you are just barely getting by, then not only will your business suffer, due to lack of overhead, but your personal life will also suffer, because there won't be anything left to take home.
Your small business pricing strategy is something that you should address as soon as you start your business.
Many of the decisions that you make in your business will be designed around this pricing strategy.
When you choose the right pricing method, you will be able to weather the storm of economic downturn much better than a business that is just trying to outbid it's competition with the best deal.