Pricing your services and building out packages can be one of the biggest challenges as a small business owner. Our emotions and how we “feel” about pricing can really get in the way of making fact base decisions that are right for our business. Today’s article focuses on the Top 5 common pricing mistakes small business owners make when pricing their services.
- Don’t Compare Yourself To Others: Understanding your market is important when thinking about pricing, but searching through your competitor’s websites and creating pricing based off “what they do” is not a long-term strategy. The truth is, every business is different and what YOU need out of your business as an entrepreneur is going to be different than others. Comparing yourself to everyone else can be emotionally draining and limit the potential you have to set your business apart from the rest, so close that laptop and stop surfing the net. Trust me, it will be liberating.
- Confidence is Key: To price yourself well means you need to have confidence in yourself and the value you bring to potential clients. This can be SO hard, am I right? So many times we think to ourselves “I can’t charge that much” or “I wouldn’t pay that for my services!” Well, did you ever think that YOU may not be your ideal client? Clients are buying from you because you are solving a big problem for them that they see as valuable. Have confidence in your abilities and serve your clients well.
- Know Your Numbers: This is by far is the biggest mistake I see small business owners make when it comes to pricing. The secret to creating successful pricing for your business is to KNOW YOUR NUMBERS. Read that again, and again, and…. okay, you get the picture. Pricing should be based on data and facts, not emotions. Know what you need to make, the cost of running your business, and your financial goals. All 3 of these things should be built into your pricing model to set you up for success and make sure you have enough to run your business, pay your bills and save for retirement (or that trip to Europe you’ve been wanting to take).
- Focus On The Customer: In order to sell your services to your ideal client, you have to know what they VALUE. It’s not about what you “think” your clients want, it’s about motivating your clients to buy your services based on what they desire most. Know your top-selling items and build those into your top offerings to draw your clients to that higher price point. Keep your packages clear, simple, and easy to understand. The easier your packages are to understand and the more they are filled with the services your clients love, the higher your sales potential will be.
- Don’t Limit Your Earning Potential: When pricing your services, you want to think beyond what your clients want today and anticipate what they may want in future services with you. Adding bonus offers, loyalty discounts, and future service offerings to your packages can result in higher sales and give your top-tier clients a reason to come back and spend money with you again and again.
Understanding these 5 common pricing mistakes small business owners make when pricing their services can help you create packages that are profitable, attract your ideal client, and set you up for future growth. If you need help with your pricing and packages, contact us today to see how we can help.