The Perils Of Underpricing As A Creative
Pricing is a big issue for businesses of all shapes and sizes, and there are a lot of individual factors involved. You don’t want it to be too high or too low for obvious reasons. However, the real struggle comes when you price yourself too low. This is a huge issue with creatives in business, and it is very challenging to recover from underpricing. If you are a startup, you may be tempted to price things low – perhaps as an introductory offer to get people in the door. It is understandable – you’re new in business, you want to make people happy, and you are not quite sure how much people will actually pay for your services. You may even look to undercut the competition, again quite natural for startups and those new to business. Price is not always the most important aspect While some of your customers will be concerned with the price, others will be more interested in whether your product or service meets their needs. If you do, then the price will be less important. But if you price yourself too low, people may assume that you don’t have much to offer your clients. If...
Read More3 More Steps To Managing Pricing: Lessons From The Restaurant Industry That Can Work For You
This week we are following on from the last post and bringing you some more steps to help stay afloat, even in a challenging economy. Consider Price Bundling to Draw in Budget Conscious Customers and to Make a Profit Who doesn’t love a deal? Many individuals refuse to spend money unless they think they are getting a deal. Once persuaded that they are getting a “good buy,” they will often spend more money that they originally planned. Successful restaurants know this, and so they offer bundled deals, such as the buy two entrees and get one of equal or less value for half price. Most other types of businesses have the ability to offer a modest discount to those who purchase more than one product or service, and can therefore reap the benefits when they increase their sales and earn the chance to impress new customers. Love What You Do and Delegate the Rest It’s important for many reasons to find joy in the work that you do. It’s also important to have a keen understanding of the costs and expenses as well as the revenue flow from your operation. This can be difficult if you are like many...
Read More3 Steps To Managing Pricing: Lessons From The Restaurant Industry That Can Work For You
The restaurant business is notorious for its razor thin profit margins. While you might think it outrageous to pay $50-$100 (or more) for a great steak dinner that features a top grade of beef and is accompanied by all the trimmings, most restaurants are lucky if they keep 5% or less of their charge for a meal. The rest is eaten up by various costs. To make a profit and stay in business, most employ certain steps to manage their prices and costs. Regardless of what industry you happen to be in – if you are in business to make money – the following steps can help you to be more successful and to stay afloat, even in a challenging economy. Don’t Assume – Do Your Homework and Conduct a Cost Analysis When it comes down to deciding what you are going to charge for a product or service, whether a meal, childcare or anything else, it pays to be exact in your calculations. Don’t just assume you know the actual cost of anything in your operation without a proper cost analysis of each ingredient or each component of your business. Know how much everything costs, and stay on...
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