Small-business owners often have difficulty deciding what to charge for their products and services, and too often they charge too little. They also fear that raising their prices will drive away customers. As a result, they’re not as profitable as they could be.
Here’s how to ask for higher prices — and get them.
Offer Better, Faster Customer Service
Like it or not, we live in an economy in which people who can afford to pay a bit more expect to be treated very well. If you want your higher prices to hold without curtailing sales, one good strategy is to strengthen your customer service.
You can do so by providing increased availability and better communications.
- Availability — Your customers will agree you’re worth more money when they think you’re more available to them. This can be a simple as: offering expanded evening, weekend, and holiday hours; delivering a broader or more finely tuned selection of products and services; or starting and completing jobs for your clients more quickly.
- Communications — Customers feel well-served when you: respond rapidly to their initial inquiries (usually over the phone, by email, or via social media); eagerly and good-naturedly answer their questions; and keep them informed about your progress on work you’re doing for them or your expected delivery of their purchases.
Raise Expectations and Then Meet Them
Let customers know you’ve stepped up your game. Even small indications of this — offering a customer a drink of water, keeping your desk spotlessly clean, or posting some kind of “Quality Is Our Middle Name” sign — can convey the message that yours is a superior operation.
These indications will backfire, of course, if you don’t meet these higher expectations. To do so, make sure your prospects and customers encounter only well-trained, knowledgeable, and helpful staff who are committed to providing positive experiences and outcomes.
Make Addressing Complaints Your Top Priority
Think of a customer complaint as a flat tire on the road to success: Until you repair it, your journey forward is slowed or stopped.
Most customers recognize that unwanted events occasionally happen. A few may even try to blame you for any imperfection. But most will cut you a fair amount of slack — provided that you work quickly to resolve their problem fairly and courteously.
When you’re charging higher prices, it’s important to obey this simple rule: No sale is complete until the customer is 100 percent satisfied.
Focus on Quality
Higher prices are ultimately going to increase your profitability. Invest some of that money toward giving your customers a higher-quality experience. This could include spending toward:
- Creating a more pleasant environment in which to do business;
- Giving clients more of your time and attention;
- Providing a wide range of options, so customers feel even more satisfied with their purchases;
- Offering opportunities to spend more and get more; and
- Establishing a strong “satisfaction guarantee” that helps to justify your higher prices.
Target High-End Customers
Charging higher prices is much easier when you’re serving customers who have more money to spend. Attract them by fine-tuning your advertising targets and promotional efforts and also by carving out a favorable niche or location.
For example, fancy chocolates sell for higher prices in the ritzy part of town. Customized cars or motorcycles go for a premium when they’re seen by prospects with significant disposable income. Wedding photography services command greater fees when you’re recommended by the classiest hotels and caterers in town.