sometimes (but not often) the answers to your business problems are
When someone asks me what's the fastest way to increase their sales and
tell them, "raise your prices". I usually get a look back from them
like they bit into a
lemon with reasons why they can't or won't. Why?
They're afraid. Afraid clients will complain. Afraid
clients will leave. But here's the truth.
Virtually none of your customers will complain or leave because if you
provide a good
service or product, they're willing to pay more for it.
Secondly, most people do not pay attention to what you charge
anyway. Not that 'they
won't notice' is a reason to raise your prices, it's just a reality.
And you'd be surprised how much price elasticity there is in what you sell
Here's an example of something as simple as chicken at the grocery
Here are 3 packages of skinless, boneless chicken breasts at my grocery
store, laying side
by side. The pack on the right is $1.87 / lb. The
middle one is $2.68 / lb or 43% more
than the 1st pack. The left one is $3.64 / lb or
95% more than the 1st pack.
Why the different prices? How can these people charge
almost DOUBLE for the SAME
piece of meat, in the same package? Look closer.
The $2.68 / lb price is FRESHER than the $1.87 / lb price. TIME
is the reason for the price
increase. It will keep longer before I have to cook it.
The other reason for the $3.64 / lb price is that the store THIN SLICED
that chicken before
they put it in the package. They did something that the consumer
could actually do for
themselves and just charged a PREMIUM price for the CONVENIENCE.
And guess what? People were buying the higher priced items right
along side the cheaper
ones without blinking an eye (I stood by and saw it happen).
So how can you apply this to your business, your services, yourself?
Here are 2 examples
using just the TIME element of what you just saw.
If You're An Accountant Or A Printer...
If your an accountant or CPA every tax season you have a group of people
that wait until
April or the last minute to show up with shoeboxes of receipts,
wanting their taxes done ASAP.
This tax season do this. Charge $X for returns brought in
during February. Charge $Y for
returns brought in during March (Y being some %-age HIGHER than X).
And charge $Z for
returns brought in during April (Z being some HIGHER %-age HIGHER than Y).
And if you communicate it to them do it this way. Base it off your Z
or April price and tell
them you'll give a % discount if they come in during March and even
more if they come in
If you're a printer you can use the same TIME vs PRICE principle.
If someone places an order
and you normally turn it around in 6 days, your price is $X. A 4-day
or "Priority" turnaround is
$Y and a 2-day or "Rush" turnaround is $Z.
Years ago I had a manufacturing client that built commercial HVAC
equipment. He mistakenly
thought his buyers were price sensitive and had to be the lowest price to
get sales. Their
profits were low and so we RAISED PRICES in 8 (EIGHT) different places
wholesale, dealer, demo's, shipping. etc.) and DOUBLED their profits
in 1 year.
Raising your prices takes guts. Starbucks is now selling a
Costa Rica Finca Palmilera 16-ounce
Grande cup of coffee for $7.00 (that's $56.00 a GALLON - and you thought
gas prices were
high). FYI, an 8-ounce package of these beans costs $40.
But raising your prices is one of if not the FASTEST and EASIEST ways to
grow your business.
If my grocery store can charge 43% more for chicken with more TIME
before I have to cook
it and Starbucks can sell $7/cup coffee (with a straight face) then
you can raise your prices
Remember, good marketers borrow, great marketers steal! Jeff
Jeff Bell - The Marketing Doctor
Questions or Comments call 317-713-1244 & leave a message (I will not
Sales & Marketing Results | PO Box 267 | Noblesville, IN 46061 |