The Market vs You.

Pricing is tricky at the best of times. The price is something the customer or client nearly always wants to know, and rarely forgets.

Pricing a product can be straightforward. You start by understanding the rate of the product to you, then add on all the expenses of your business so you can see the final “cost” of the item. You then find a balance between making a profit, meeting market expectations, and not pricing yourself out of consideration.

Doing the same to a service is not so simple. Firstly, the cost of the service can mostly be your time, something not so easy to quantify. Then you need to compare your service to the market, and unlike products, services differ greatly from one person to another. Lastly, the price of your service is a direct reflection of your brand (you) and how you want to be seen.

While there are no hard and fast rules to pricing, here are some simple tips to help:
1.      While some people intentionally go for the highest-priced option (in the belief higher price means better quality), most people avoid high prices and instead look for a price in the bottom 50% of the market.
2.      Factor discounts into your pricing plan. Know ahead of time your RRP and how low you are prepared to go for a sale.
3.      Do your research. See what the competition is selling their products/services for. Nothing wrong with undercutting to win a deal.
4.      Don’t be afraid to be smart with the numbers. $1999 does look less than $2000. $1920 looks even cheaper.
5.      Most importantly, know your break-even point. While there are times that selling at a loss can be beneficial, those cases are few and far between. Selling at a loss might get you revenue, but it’s bad revenue.

If you need help with pricing, or understanding your business’ numbers, contact Accord Consultancy for a no-obligation consultation.