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price for value

If You’re Leaving Money on the Table, It’s Time to Fearlessly Price for Value

By now you can see that there’s a very systematic approach to improving profitability in your business, yet often we’re so busy chasing the latest bright shiny objects that we overlook the basics that make all the difference.  Yet it’s easier than you may think to completely transform your profit picture just 90 days at a time when you tackle each of the elements we’ve explored so far:

P: 3 Powerful Insights to Transform Your Business 

R: Realize Rapid Results With the 5 R’s

O: Easy Ways to Obliterate Operational Sludge

Now let’s tackle the F: Fearlessly Price for Value.

Price for Value to Drive Exponential Profit Increases

Let me be clear.  We’re not talking about gouging, or pricing ourselves out of the market.  We’re talking about understanding what customers value, and then delivering it at a win/win price that we both feel good about.

There’s often a lot of guesswork involved in pricing, but there’s a better way.  When you understand how to price for the outcomes you create, rather that the inputs you provide, there’s a level of value that far exceeds the “cost-plus” approach to charging for products or services.

It’s critical that you become an expert at pricing for value because every 1% price increase can drive a 16-38% impact on your bottom line.  Don’t believe me?  Check out the impact of every 1% on your business with this Pricing Leverage Calculator.  The biggest challenge is that you have to know where to look for value before you can price for it.

Value is the antidote to fierce competition, sealed bid scenarios, and relentless pressure on margins.  It’s driven by how effectively you save your customers time, save or make them money, solve the problems they’re struggling with, create a ‘feel good’ or provide them with peace of mind.

It’s the reason we all happily pay five times as much for a bagged lettuce assortment in the supermarket as we would for a head of iceberg lettuce.  We see the value.  I call this the Find Your Lettuce System.  It’s a powerful set of tactics to share with your sales team, and it’s one of many opportunities to price for value.  What would it mean to your business for your customers to see so much value in what you do that they happily pay more than your competitors are charging?  If they can do it with something as mundane as lettuce, you’d better believe you have opportunities in your business too.

Do you fearfully price to beat the competition, hoping you don’t lose the business, or fearlessly price for value, confident that your customers will pay for the “lettuce” only you can provide?

#1 Bestselling Author, International Speaker, and Accelerator Anne C. Graham is on a mission to help 5 million business leaders and their teams double their profit per employee – or more – in less than one year, in less time per week than they’re spending on email per day. Her new book Profit in Plain Sight includes the 5-step proactive P.R.O.F.I+T Plan to do it.  Connect with Anne on Twitter and LinkedIn.

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