A Beginner’s Guide To Pricing
Product or service price is the key driver of profits. When you get your pricing right, the other parts of your business will fall into place effortlessly. If you get it wrong, people will believe that what you have to offer is beyond their reach or too good to be true.
If you are launching a new business, it’s mandatory that you carefully consider your pricing strategy before you set up shop. However, as a brand new business, you may find it challenging to figure out the right amounts to charge, or you may leave out crucial elements that must be accounted for in your prices.
To help you keep track of all the essential elements while pricing your products and services, the financial experts at Morley CPA Professional Corporation have put together a Beginner’s Guide to pricing. The goal of this guide is to give new business owners a taste of the many different aspects of pricing and get them on the right track.
Understand your audience: Make a note of who buys your products - what do they do (for a living), what are they interested in, and what demographic they fall into. This information will tell you exactly who your primary audience is, what they need from you, and what they are capable of paying for your products.
Sort your audience by budget: Once you know who your audience is, it’s time to segregate them based on their budget and the service most suitable for them. For this, you’ll need to prepare three lists. First list the basic service you provide to someone on a tight budget. Then list the service you provide for someone who wants everything you can offer. Lastly, create a list of the services that most people buy.
Price your products to suit you: Your potential customers have no idea what they should pay for your services, and they will have their own idea of what to compare your services to. So, it is essential that you set your prices to suit you so you can do a job that’s worth the money people pay and you can set the comparative price for your clients.
Advice From The Pros
People want what you’re selling: So many businesses say that they wouldn’t pay too much for the services they offer. However, that is their opinion because they can do it themselves! Remember, your customers are coming to you because they can’t or don’t have the time to do what you do.
Set a price for each service: Develop a pricing strategy for each of your services and then bundle them. That way, you can avoid confusion while selling them individually or as a discounted package with other services.
Hire an expert: Enlisting the services of a pricing expert like a chartered professional accountant can help you speed things up with your pricing strategy. They will help you see what you need to consider while pricing apart from your expenses and profits. They will also take into account your business goals of growth, brand building, or breaking even and accordingly help you decide when you need to drop or hike your prices.
For expert guidance on pricing, reach out to, Morley CPA Professional Corporation. Our professional accountants in Gravenhurst and Barrie, ON, are prudent with financial strategies and leave nothing to chance. Every decision we help you make is efficiently calculated and directed to help you succeed. Our services are available at three levels based on your business needs and financial capabilities. That way, you have the freedom to run your business the way you choose to.