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7 Tips to Jump Start your Public Speaking Success
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Profitability - Pricing Strategies To Make Money
At a meeting the other day, a marketing consultant opened her
talk by asking the group, "What are you worth?" She went on to
discuss all the different ways we minimize our worth or discount
our value in desperate attempts to close the sale. After all the
pitfalls of pricing and selling were laid out, she closed the
talk by asking again, "What are you worth?" The responses around
the room were very entertaining as people began to realize or
give themselves permission to adjust their prices to make a
profit!
As a wakeup call for your own business, I want to give you some
options to consider ensuring your pricing delivers the
profitability you deserve.
1. Educate your customers. When prospects approach you or
calls/emails you for an estimate/quote, this is a buying signal.
They are telling you they are ready to buy and willing to spend
money to purchase your expertise. - Provide superior service and
they won't look elsewhere and won't blink at your price.
Excellence is priceless.
2. Many prospects perceive value and price as equal. A lower
price can actually hurt your credibility and sales because they
associate the best quality products and services with premium
pricing. Listen to your customers. - Do some competitive
research and be sure you are not shorting yourself.
3. Periodically calculate your profit margin to be sure what you
charge, after expenses and overhead, pays you a good living.
Covering expenses, overhead and payroll is not enough.
4. Periodically do the numbers to be sure that the actual
cost/hour and price/hour give you the necessary profit margin.
Your daily rate may sound reasonable. But if you bill for 7 or 8
hours and put in 12 -14 hours, you may actually be paying
yourself less than your lowliest employee or intern.
5. There are ways to keep your prices fixed to maintain value
and yet be flexible. Add the flexibility by designing different
bundles of
services or different packages of hours/month or
hours/project to be contracted.
6. Set your fees just a bit above what you feel comfortable
asking for. Then, bump them up incrementally until clients
complain or you stop getting reorders.
7. When asked, be upfront about your prices, and then zip it. Do
not apologize for your prices, defend your prices, or justify
how you derived the price.
8. Yes, there are strategic times when negotiating a price is in
your best interest. For example: a unique packaging of services
for a new type of client, or the pilot or beta testing of a new
product or program.
9. If you still think your initial consultation/sales
presentation with a client should be for free, set some
boundaries and expectations and clearly state the value and your
investment in preparing for that initial consultation. Another
way to approach this is to charge for the initial consultation
at your full rate and if they purchase your product or service,
that fee gets applied to the final invoice payment.
10. If you close the sale and get paid on that one sale but
provide value-added services of following up in a number of
ways, are you losing money from the opportunity costs? Maybe you
can charge a small premium to provide stellar customer service.
Clients will value it more if they have to pay for it.
You have to appreciate what you are worth before your clients
will. Decide what you are worth in the marketplace. Be sure your
fee or rate has a profitability factor built in. You are worth
it.
About the author:
Kerri Salls, MBA runs a virtual business school to train,
consult and coach small business CEO's and entrepreneurs in 10
key strategies to make more profit in less time. Learn more at
http://www.breakthrough-business-school.com/products.html or
sign up for a free weekly newsletter at
http://www.breakthrough-business-school.com/newsletter.shtml
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