ITS A BRAVE NEW... Price

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As we reach the end of the financial year, it's a great time to pause and reflect on all that we've accomplished. Before your Accountant works their magic to handle tax compliance, take a moment to run some reports from your accounting package and see how you've fared. How did you do? Did you see growth on the bottom line (Net Profit)?
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Often, year-on-year comparisons are overlooked, leading to unnoticed declines in margins and profits. Your pricing strategy plays a crucial role in this. If you haven't revisited the prices of your products and services at least annually, your purchasing power today will be less than it was last year.
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While price rises are expected in most industries, failing to adjust your prices can result in your business losing value and money. That's not why most people start businesses, unless they operate in the Not-for-Profit sector, which is a different ball game altogether.
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In recent years, we've seen inflation rates of nearly 7%. If you haven't kept up with this trend, you might have inadvertently decreased your income and purchasing power. If your clients are facing price hikes across the board, it's reasonable for them to anticipate the same from you.
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I often hear concerns about potentially losing clients if prices are increased. But is this fear based on a probable outcome, a possible scenario, or an unchallenged assumption? Unless you operate in a monopolistic market (and if you are, you probably aren't reading this), competitors in your space have likely already adjusted their prices, leaving you at a disadvantage.
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Remember, your clients choose you for your expertise. Don't undervalue the years you've spent honing your craft. You deserve to be compensated fairly for your skills and knowledge.
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The best approach is to have open conversations with your clients about upcoming price adjustments. Avoid getting into any negotiation or making excuses; simply explain the situation as it is. While you may lose some clients (often the high-maintenance ones), new clients who join in the future will be onboard with the new rates.
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If you need assistance with running those reports or want to explore strategies for increasing your charges, feel free to give me a call. I'd be more than happy to help you navigate this process.

As always, if you found this interesting please share with friends, family and business owners you may know.

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