Pricing is one of those topics of conversation that can get heated very quickly. For many small businesses, in particular, it’s the type of conversation that will bring up those pricing gremlins you have around pricing your products or services.
But it’s those pricing gremlins that can hold you back if you don’t get them sorted.
So, let’s take a look at the typical pricing gremlins that could be affecting your business growth.
It’s great to research what other, similar businesses are charging, but use them as a guide, not a rule. Other people’s pricing doesn’t factor in the results you can get for your clients, your abilities and expertise.
And it certainly doesn’t factor in your costings and time, so you need another strategy.
Instead, before you price anything, know what your minimum costs are. [Don’t worry if this sounds overwhelming - I have a pricing calculator that can help...
I get asked a lot whether you need an accounting system to run your accounts, so I have put together 5 reasons you would want an accounting system.
You are a limited company
If you are a limited company, you need an accounting system. The requirements for submitting accounts and tax mean it is a huge advantage to have an accounting system and would save on year end accounting fees.
You are VAT registered
If you are VAT registered or plan to be, even if you are a sole trader, Xero can submit your VAT return at the press of a button. It makes a huge difference to managing VAT in your business.
Your business is complicated
Your business may have several revenue streams to manage, or payroll to pay, or be in business with someone else. Or you are a product business with stock to manage. Having a system, rather than a spreadsheet makes managing your business much easier.
Real time information
Having information and knowledge at...
Which of your products and services make the most money? Is it the one you love to sell? Or is it the one that is really low priced but you sell loads of?
In a business where you offer several different streams of income, you need to know which ones make you money. The ones that take a lot of effort might be making you no money and you need to think about how to generate more money from those that are bestsellers.
To do this, you need to know your cost per product or service.
In your business, you maybe offer a course, 1:1 coaching, workshops and an ebook as an example. There will be some direct costs (you only incur if you do the work), such as the hire of a venue, or paying a speaker, plus affiliates and associates.
Then there are the indirect costs (overheads). These include, your website charges, social media, VA and so on plus paying yourself. This is everything else, basically, in your business. You need to work out how much this is per hour by taking...