Small Business Pricing Strategies

TACTIC #1 -- Never simply slash your prices, unless you're trying to empty obsolete inventory. Instead, try repackaging your prices so they're more affordable in the short-run so more prospects can afford them. For example, rather than pricing your service for the year, "Our monthly newsletter is only $39 for the year." Instead, try "Our monthly newsletter is only $3.25 per month." If you accept credit cards, it's very easy to set up reoccurring monthly charges that are billed to your subscribers without having to intervene every month beyond the initial account set up. The upside to offering your subscription on a monthly basis is that you can now market a $3.25 headline versus a more expensive $39 headline, i.e. you're able to offer services at a more affordable rate without slashing prices.

ANOTHER EXAMPLE
Here's another example. Just last night I was on the phone with a potential marketing client. As a small business owner she's trying to get some marketing help and is on a tight budget. My standard hourly consulting fee is $225, which is not always appealing to some businesses. However, in trying to work within her budget I suggested that my services could be more affordable for her if she allowed me to help her through email instead of face-to-face or on the phone. Let's face it, when you're on the phone with a client it takes longer to accomplish what you're doing since you're not only answering their questions, but you're building a relationship and talking about unrelated topics. It's difficult not to. In fact, you should! No matter what type of consultant you are, building a successful business is not about the initial sale, it's about establishing a long-term relationship with customers.

One-off sales don't lend themselves to growing a profitable business; rather, deep customer relationships do! However, since I was able to establish a trustworthy and comfortable relationship with my prospect on the phone, she thought my marketing services through email would be a win-win. Did I slash my prices? No, instead I found a more efficient way to offer my services, whereby I could offer them in less time and therefore, my client will pay less money. This strategy could work for business coaches, fitness experts or personal chefs, when the latter prepares meals in her home rather than in a client's home.

TACTIC #2 -- Create tightly niched product or service offerings. For example, if you're operating a personal concierge service, rather than just offer errand services at $25 an hour, try prepackaging specific errands with associated lower pricing. Why? Because you can offer a more aggressive price when isolating your fee to one particular service. If your customer challenges your reduced price as compared to your higher hourly fee, your response is simply, "I'm able to offer this lower packaged price because of economies of scale. While I'm out delivering your bundles to the Post Office, I'm also delivering packages for five other customers." Ultimately, your customers will never know how many other customers you're delivering for that day; however, the key is not to simply slash your pricing because you believe that reducing your prices will bring you more business. The key is to provide consistent and professional pricing practices.

P.S...Yes, business is slow for many entrepreneurs right now; however, be cautious with your pricing methods. Don't simply slash prices; instead incorporate long-term and short-term strategies that are always complementary to each other. If you offer a product for $15 today, then again at $35 six months from now, you must have your reasons in place, otherwise you'll aggravate your customers.

Sharron Senter is a New England-based marketing consultant, speaker, writer and founder of Senter & Associates, a marketing communications firm that helps small businesses deploy low-cost marketing strategies. Sharron is well known for her free monthly emailed marketing tips, found at http://www.sharronsenter.com. She's also the cofounder of http://www.VisitingGeeks.com ? an onsite computer repair, networking and security company based north of Boston.

---

What Happened to the Money and Freedom?

Ask anyone trapped in a cubical about their entrepreneurial dream... Read More

How to Give FREE Advice and Make Money

When is advice free and when should you charge for... Read More

The Greatest Challenges the Internet Consultant Faces!

While there are few career paths that some would call... Read More

Lack of Vigilance Can Harm the Bottom Line

The easiest way to lift profits is to cut the... Read More

Finance Your Small Business: So Much Money, So Little Time

$37.4 million funded from venture capital today. $86.4 million funded... Read More

Serious About Writing A Business Plan... Start A Business Plan Library

Tap these treasures of ideas. The best money you can... Read More

Tips For Successful Home Show Businesses

Opportunities for home show businesses have never been more abundant.... Read More

Local Government Relations for Small Business

Most small businesses simply go about their daily business and... Read More

Buying a Business

Start thinking about buying an established business if you want... Read More

How Disabled Veterans Can Win Government Contracts

The Service-Disabled Veteran-Owned Small Businesses (SDVOSB) is a program that... Read More

Presentations and Sales Automotive Detailers

Many auto detailers fall short in their sales presentations. I... Read More

Mobile Detailing Expansion Considerations

Expanding your business requires you to take a good hard... Read More

Electronic Franchise Disclosure and E-Signature Future for Investors

It has been discussed allowing Franchising companies to electronically disclose... Read More

Small Business Marketing, According to Seinfeld

What could Seinfeld possibly have to do with marketing a... Read More

Starting A Concrete Cleaning Pressure Washer Business

Concrete cleaning can be a lucrative business to start. Here... Read More

There Is Security in Change... But Use Caution

It has been said that the only constant is change.... Read More

Boston Market; Mobile Auto Detailing

Boston itself covers 50 square miles of concrete and traffic,... Read More

Small Business Spoiler - Procrastination

One of the most common issues that comes up for... Read More

How Is the LEGAL SYSTEM Dishing Out JUSTICE in Your Town?

Thankfully, most of us will never find out. That is... Read More

Is It Recess Yet?! Confessions of a Self Employed Workaholic

I have a confession to make. My name is Caroline... Read More

Choose Your Own Guru

What is a guru?A guru is a teacher. A mentor.... Read More

The Single Most Powerful Small Business Marketing Tool On The Planet

Let me get right to the point. The single most... Read More

Get Free Payroll Forms Download from the Internet

Having a successful business means also having a good working... Read More

Creative Metrification - A Technique to Improve

Some things in business are relatively easy to measure ?... Read More

Six Essential Skills to Business Success!

The following are six essential skills to business success. You... Read More

The Benefits of Using Freelance Consultants / Trainers for Your Project

What are the benefits of using a Freelance Consultant /... Read More

How To Write A Business Plan

Writing a business plan is a fundamental step to ensuring... Read More

Pressure Washing Aircraft Hangers at the Airport

If you are looking for a way to own your... Read More

Employee Monitoring - Business Risks For Employers And How To Avoid Them

E-mail and Internet use are integral parts of the typical... Read More

How to Profit Handsomely From a Secret Business Model Virtually No Small Business is Using!

Have you been searching for the perfect home-based business? I... Read More

1 Overlooked Key to Small Business Success

Is this you?You dreamed of owning your own business, doing... Read More

Everything I Need to Know About Business I Learned From My Nametag

So there I was ? sitting in the audience of... Read More

Making Direct Mail Work for Small Businesses

If you own a small business, then you know the... Read More