Here's a profound statement about price...
Too many business owners don't charge enough for what they do.
Let me give you a few examples to back this up. See, my position is that price is only an issue when there's nothing else to talk about.
One of my coaching group members has a contract cleaning business. For some time, they thought they had to compete on price but when we examined what they provide against what the market, their value proposition stacked up. Their staff are covered by public liability and workers compensation; they get Superannuation and a bunch of other benefits as stipulated under local legislation. This means that in the event of accident, everyone's covered. Backyard operators who only sell on price don't have this protection.
Their clients are provided with a business invoices, meaning that their service is fully deductible as a business expense. Again, someone doing cleaning for cash in between jobs or moonlighting doesn't give invoices.
There are a whole lot of other reasons but the fact is that this client has increased their fees by almost 30% and secured some higher-level clients along the way. What matters is that the 30% fee increase is pure profit as the fixed costs of delivery don't increase. Say the fee increase was $10 per hour and you were billing 1,000 hours per month, that's $10,000 per month or $120,000 per year incremental NET profit. Not bad...
Another member is a travel agent. They provide a passport photo service for which they have been charging a whopping $11. We canvassed the group and asked what they would happily pay for a passport photo if their travel agent offered. The lowest price was $20 and the highest $30. Imagine we increased the price from $11 to $20. That's $9 and at one per day, 6 days each week, that's $2808 in incremental net profits per annum.
Another (no names to protect his highly unique identity) was offering free membership to his program. Conversions were running at 5 - 10%. Now at $1,500, conversions are running at 70%. How much did he leave on the table?
Your ability to increase prices comes as a result of the way you package what you sell; by illustrating the value differential you provide. It also comes with confidence - confidence in the way you sell.
The best clients are those who understand value and are willing to pay for it. Confident people deliver value. Confidence in sales comes from understanding and applying a process that works.
My final thought before I go grab another beer and relax for the evening? On Monday, go put your prices up. You can afford it.
How a Simple Change Earned This Contract Cleaner Thousands - To learn more about this author, visit James Yuille's Website.
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Leanne Hoagland Smith
Are your sales where you want them to be? Will you be one of the few who achieves sales success or one of the many who have failed to change? So what are you doing to change those results? Let’s be honest, with companies moving globally and at lightening speeds, the traditional business solutions are outdated and dead. My approach moves your business out of its comfort zone and secures your competitive advantage now. If you are seeking to increase sales, build customer loyalty, create a culture of great attitudes or just achieve some sleep filled nights, then we should talk because my clients have experienced exactly those types of results. Learn more about customer loyalty at http://www.processspecialist.com/customer-loyalty.htm Give me a call at 219.759.5601 for a free strategy session. P.S. If you are seeking a motivational speaker, sales trainer or small business expert that will leave your audience smiling and remembering, please feel free to contact me at 219.759.5601. - Visit Leanne Hoagland Smith's Website |
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James Yuille
(Visit James's Website)
James Yuille is best known for taking a
straightforward approach to customer
generation and retention. His sales career
started when he sent a direct sales letter
to a potential employer who hired him
without even interviewing him. For 33
years he has generated new business in a
variety of markets; representing
multinationals and small business with
both products and services. He has sold
the 'unsellable' and has taught hundreds
of salespeople how to improve their
results. He provides practical, sensible
cosultancy services to small and medium
sized businesses and has been responsible
for many successful on and offline
marketing campaigns. More than a marketing
consultant, yet not a business coach,
James partners with his clients to see
things from their side of the desk.
He is a trainer, consultant and copywriter
who is interested in two things; helping
you identify what works and keeping you in
focus.
Find out more about James Yuille at www.Jam
esYuille.com
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