The Most Overlooked Principle To Raising Your Prices
Finding customers is not usually the hard part of selling. It is"closing" that can drive you mad. You know the excuses. They wish to shop around a little longer, they are not sure they can afford the purchase price, they will need to get approval from a superior. The list continues on and on. Your challenge is to figure out ways to close prospects at a greater speed, and thus accelerate growth and increase earnings.
One sure fired way to raise earnings without damaging your reputation, is to educate your clients into your cost increase first before doing this. You don't need to be concerned about raising your costs. Most individuals are reluctant to raise their costs.
By way of instance, one of my first companies operated in a marginal cost only under the standard for the industry. We have a lot of company and kept the customers coming nevertheless, we did not get a lot more business than the next man whose prices were higher. We're always afraid to raise our costs and lose clients.
Ultimately, we did. We got as many clients and improved our bottom line by 35%. We then decided to increase our prices . Still - same quantity of customers.
We ended up raising them higher to nearly double what we had initially started at. We did lose clients at that point. But, we had increased our prices so high that our margin was much greater than it was before and we doubled our company. All by simply increasing our costs.
We'd already delivered quality work and were confident in our services and products. All we did was increase our costs.
To conquer people just searching for cost, educate them.
What we did was let them know about a few of our follow-up solutions, our customer service program, things that we obviously included in our support which other advertising companies didn't. By instructing them and showing them exactly what they were getting, they were happy to cover our pnces.
Why would anyone pay more for exactly the same thing? Once they found out what we were offering, they did not perceive us as supplying the identical thing as the other advertising companies. If you don't teach them, they perceive you exactly like another organization.
If all things are equal, they will select the cheapest price. As soon as you convince them and educate them, you do not need to think about it. Cost is just what you pay for something. Value is what you get. The client wants to know what he is going to get. Every client wants to think they are going to find decent value.
Your clients do not really care about the low cost, particularly if they're going to get poor workmanship and poor services or products. They want value. If you give them value, you may also charge them for it.
Do not wait for them to tell you you're expensive or they can not afford it. If they are telling you this, it is too late. You have not educated them about the value they'll receive from your services and products. You will need to instruct them right from the start from the time that they request your no price report or book. Your customers aren't automatically inclined to purchase the cheapest thing they could get.
Boost your costs. Get paid. You are worth it. If you've assembled in a terrific warranty, which should be one of your plans, then you're on your way to provide quality services and products to your clients at all times. You do good work, give them excellent quality, instruct them, you are much better than your opponents you should get compensated for it. If you think you're worth it, then your prospects and customers will believe it also.