Setting your prices can be a bit of a guessing game but shouldn’t have to be. There are a few things that you should consider when setting your prices.
Covering your costs
There are a lot of costs involved in running a business but think about the costs that are directly involved with producing that product or service. These should be considered when setting your prices.
Are you covering all your costs? Have you taken into consideration the costs involved with delivering that product or service?
If you are a product based business, it’s not just the cost of the item your selling that you need to cover, do you cover things like your packaging, postage, labour involved in packing, transport and returns?
If you are a service-based business, are you covering your overheads, your office costs, subscriptions, and insurances?
You will be surprised how your margin changes when you work it all out.
Think about how you present your packages or prices. Do you have a long list of prices or just 2 or 3 offerings?
A few of the things I find clients trying to overcome is what they are offering? Having too many offers, not charging enough, or not getting the balance right.
If you have several offers or hourly things, try grouping them into a package, people will rather pay for a package in a one-off rate than several little rates. It is just more appealing.
When you have a few offerings, keep it to 2 or three packages and put the one you are most known for or the most popular in the middle. People are most likely to go for that one as they don’t want to go for the most expensive or the cheapest.
Know your worth
It’s difficult not to compare yourselves with others offering the same service or product. Do you think you might be pricing yourselves out of the market if you don’t?
But consider this, do they have the experience, qualifications, the same overheads you have, the same experience, or travel the same distance. So how can you compare like with like? You cannot. You have to travel your own path and work out what is best for you.
Know like and trust
At the end of the day, people will buy from people, not the cheapest or the most expensive but the person they most relate to. If they like you, trust you and know what you can offer they will buy from you.
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