One of the first things I do when I am looking at helping a client increase their income is to look at what they charge for their products and services. In most cases, I find that they are setting their prices too low.
There are many reasons why we set our prices too low. Most of them are psychological and in our own heads. In some cases, we do not think we are good enough to charge higher prices, or we do not believe in our product or service.
Our prices should not be fixed at what we think we are worth. They should instead be fixed at the value that the customer gains in solving his problem by using our solution.
If I charge a client £300 for a coaching session but that client can increase their revenue by £10,000, that is incredible value for money.
We often set our prices low because that is what the competition charges. But our product or service is not exactly the same as the competition. We have different experiences, different values that we bring to our clients.
If we differentiate ourselves enough, there will be no one else who has the same product or service so we can charge whatever we want.
And we often charge lower prices because we are worried that no one will buy our products. That is just fear doing the talking.
If you have a product that is not selling, try increasing the price. You may be surprised.
If you raise your prices, your clients will perceive your offering has more value. You will get more money, in less time, allowing you to work more on your business and advertising, actually increasing your value.
You will get better customers who expect more from you. This will force you to raise your game, add more value, which in turn will allow you to raise your prices even further.
You don’t have to raise your prices. You could be selling a Kia Picanto where the customers don’t care as much about add-ons, top service, or performance. That is a valid business model. Or you could be selling Porsches, where the clients have higher expectations of service and performance.
Either can be good options. You get to decide which model you go for.