Most business owners work hard to grow their top line revenue so they can achieve an even bigger bottom line. But here’s the thing — while there are several ways to grow a business, not all of them actually grow your revenue, or more importantly your profits.
So, what should you do?
If growing your revenues is at the top of your list for 2021, then the best place to start is raising your prices.
Yes, I know that the thought of raising your prices is scary. Having worked with hundreds of growing businesses, and having grown my own in a very short period of time, I can tell you that hiking your prices is always difficult, but it’s important, and not just for your business.
Raising prices is an essential step for helping you develop the mindset needed to really take your business to the next level.
The Problem With Saying “Yes”
Many people are addicted to the yes to every client. Afterall, it’s how they were able to start the business in the first place.
Addiction to the “yes” makes us hesitant when it comes to raising prices — always saying yes causes you to undervalue your work. This means that you are not priced correctly in the market and missing business revenue growth.
As I’ve said, raising your prices can feel scary, there’s fear of losing business and your inner voice questioning if you’re truly worth it. Believe me, I’ve been there and have come out on the other side to help you trash these limiting beliefs.
It’s fear and scarcity mindset that hold us back from raising our prices. What if someone says no? What if people say they can’t afford it? They are not your customers. As you grow your business, you’re going to outgrow your customers. And that’s ok!
You’re Not Alone
Most business owners are guilty of underpricing their services. I did for many years, and the truth is that every quarter that goes by, you have gained more experience, perspective, customers, testimonials, and proof of your work. Each of these elements increases the value of your services or how you deliver your product.
We all like the feeling of clients and customers who say yes quickly. It feels good on both sides right? I had a mentor tell me once that if they say yes too quickly, then it’s time to raise prices.
And if you’re backed up with a waitlist….well then you really need to raise those prices!
If price-raising makes you feel anxious, then I encourage you to always be raising prices just a little, on every new project. This is obviously more challenging when you have posted prices on your website or ecommerce product page, but the mindset and approach should be the same.
How you Know you Hit the Sweet Spot
Always be reviewing and raising prices until you start hitting the ceiling.
And what is that ceiling?
You know that you’ve probably plateaued when the yes’s slow down or become more painful. I know my prices are set correctly when it takes clients a few days, and even a followup call before they say yes. It hurts a little…or sometimes a lot. And they tell me that it does. But here’s what I know, the transformation begins with the transaction and when it hurts, they value the work more and end up being a more focused and collaborative client.
That’s the kind of business I want to grow. Raising my prices raises the caliber of clients I get to work with.
There are more customers out there, even better ones that value your service and are willing to pay your prices.
And guess what? This has a knock on effect…better clients mean that my team is happy, which I’ll talk more about in another post.
How to Raise your prices
- Make Sure the Time is Right — Make sure your customers are satisfied with your service. Be diligent about providing value always, especially leading up to the raise.
- Add extras — Think of something relevant to throw into your service or product packages that would cost you little or nothing, but would raise the perceived value to the customer. (Free ebook, bonus coaching call, etc.)
- Target a different customer base — Find a more affluent customer base with the budget to support your higher prices. These higher paying clients will offset any you lose from your price increase.
If you want more simple tips to grow your business and raise the bar in 2021, Join us in our Facebook group of small business owners and entrepreneurs, just like you. Join the discussion and learn from a Certified StoryBrand Team, and the best part… It’s FREE.
You’re worth it!
Raising your prices leads to higher revenue and quality of clients, this is a win-win! You may lose clients along the way, but you will come out on the other side with new, epic clients and more profit!
It’s simple, decide the next proposal you send will be for a higher rate. No if’s, and’s or but’s about it: you are worth it! Don’t hesitate, raise your prices today and thank me later.
It may not be easy, but you didn’t get into business for yourself to take the easy route. Take charge of your financial position, bring in more profit, and create space in your life so you can truly thrive!