Business Development Specialist

In retail I used the marketing principal of price to ensure the customer’s expectations of the goods were met.  The only time I reduced any goods out with normal sale time was if the product had a defect in it which did not affect it’s performance but maybe affected it’s looks, never did I compromse the price of my products because the customer wanted me too.  Pricing should be used to position your products so that they are attractive to what ever maret you are catering to, once that price has been set you should have every confidence in the price matching the qualities of the product, here is an example of what you can lose if that confidence is not there.

Recently I required a job to be completed which, once up and running, would have a monthly service charge, the company sent out a proposal document to me after our intitial discussions, being happy with the proposal I accepted it and the work begin.  Well through the project we were discussing the monthly service fee and I was confirming that I had read the propsal properly and the on going charges would be $50.00 per month, to which the person providing the service replied “no, we’re only charging you $10.00 per month as that was what I told you during our intitial discussions” you can imagine my surprise, pleasant as it was this person had just lost $480.00 per year!!  No that does not seem like a lot but if I put that in percentage terms this company is losing 80% of it’s advertised revenue, how many businesses can afford to do that long term?

The point I am trying to get across here is, not only do you have to price you products or services properly, you have to have confidence in that price and stick to it, if you have done your home work your price should not be a big barrier for your clients.

So how do you set your pricing, what should you take into consideration when going through this process and how can you use pricing to increase sales?

• Decide how this product or service fits into your overall product range, will this product be priced as a loss leader; cheaper than your other products but used to draw more clients to your business.  Will the product be the ultimate product in your range so priced more expensive and helping the business project an image of quality.
• How are your competitors priced, will you have to be more competitive than them to get your market share?
• By setting your pricing at a certain level will you appeal more to a certain market segment than your competitors?
• Is your product seasonal, will you have to adjust your pricing depending on the time of year?

Being flexible with your pricing or ensuring your product range is wide enough to full cater to your chosen market is the key, but whatever you do have confidence that your pricing is what it should be, if your confident your clients are more likely to pay what you want.

If you want more information on this subject please contact me or feel free to leave any comments below.