"Your prices. Nothing has a bigger impact on your business’ sales, health, and bottom line. Set your prices too high, and your products or services won’t sell. However, according to analyst firm McKinsey, lowball prices are a far more common problem for businesses. In fact, they’ve found that upwards of 80% to 90% of all poorly chosen prices are too low.
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Are Your Prices Too Low?.
Someone once told me, “If you set your prices once, they’re probably wrong.”
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In addition, if your initial business strategy was to undercut the competition based on pricing alone, your prices are too low. Unless you are a multinational corporation selling commodity products, then cost cannot be the only weapon you have to attract new clients. It’s time to pick a new strategy and raise your prices.
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Get Confident: Know Your Value.
What’s at the root of low prices? For the new business owner, it typically boils down to a lack of confidence. You charge the least amount on the market for fear that clients won’t pay more.
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How to Raise Your Prices...
1. Sell based on value, not just price.
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Work on differentiating your services by illustrating the unique value you bring to the table. By competing on performance instead of purely price, you can frame the customer’s decision in terms of your company’s strengths.
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2. Create tiered packages. If you’re worried about what kind of resistance you might face by raising your prices, you can ease into the waters by creating tiered packages that appeal to a broad range of customers.
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3. Just do it. Sometimes the best way to determine if customers are willing to pay more is to simply raise your prices and see their reaction.
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Most important, keep your communication brief and don’t apologize for the pricing change.
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4. Don’t worry about a lost sale or two. If no one has complained about your prices, it’s time to raise them.
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Don’t worry if you lose a sale or two. By raising your prices, you end up working with the kind of clients who understand the value of investing in higher-priced, higher-value solutions. In short, your pricing strategy can help you attract the right kind of customers to build a sustainable business for the long haul."
quinta-feira, abril 17, 2014
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