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Armstrong Beech Marketing Marketing

Pricing

I’ve put together some thoughts on pricing which should be part of your marketing strategy and absolutely critical to get right. But probably an easier topic to talk face to face, so I hope this gives you some food for thought, and prompts you into action if appropriate. I’d be happy to discuss the marketing aspect on a 121 in more detail, and I’m sure your accountant would be only too happy to help and support.
So then, what is your product/service worth? How have you calculated your price? Are we approaching an economy where greater emphasis is being placed on price over quality? Are you able to test and measure your pricing?
If you can spare 2.25 mins, do watch this video (has sound)   “The Vendor Client Relationship In Real World Situations”.
Here are some of the common pricing methods:
Going rate: you look at what your competitors* are charging and get a feel for the ‘norm’ and the range within that norm. You then decide at what level of this range you’re going to pitch your business and calculate your hourly/day rate. You need to take into account outside influences, such as geographical, and whether you can charge a premium because you are simply the best, the work has to be done at unsocial hours, or it’s a grotty job that no one else wants to do!
Fixed cost: where you quote for the job/service
Cost plus: you add a standard mark up to the cost of the product/service
Value based: you decide what the buyer perceives as its value
Proportional: you set your price in proportion to a larger project/product or sale
Hunch: you go with your intuition and add thoughts and experience
Pay what you think it’s worth: sometimes seen for attendance at a workshop/ seminar.
Free: usually to attend a seminar/webinar/taster session of your product/service. Take care how much you give away for free. Whereas a free product tester can be great, for a service, is ‘free’ ever valued?
Discounting: hmm. You need to take great care – not only will you have to sell X% more to equate to your previous turnover BUT what is it doing to your brand and how people perceive you?
*You’ll know what your competitors charge because you will have done a competitor analysis, I hope. This information too is invaluable for your business development/sales people.
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