How often have you considered your pricing? This may have been on products, services or offerings. And how many times have you simply resisted the urge to “up your prices?”
As a bookkeeper this is something that I have witnessed time and time again.
After covid19 lockdowns (as an example), I saw so many small businesses NEEDING to up their pricing, but AFRAID that if they did, they would lose business and lose clients. The result, business owners working long, hard owners achieving the same, if not less than before.
As a business owner have you considered that everything else increases on an annual basis You are affected with increases in membership and professional body fees, licences, renewals, rentals, insurance, increasing interest.
If you are not upping your rates how are these increases being serviced? By you or your profit!
Your customers expect an increase, this enables you to continue to deliver the same exceptional service, the same quality in goods, and the same value in your offerings.
Perhaps you are worried that if you increase your rates, you may lose certain clients. Let’s take a logical and unemotional look at the numbers:
Imagine increasing your pricing by 5 – 10% per annum?
What difference would that make to your bottom line?
And if you charge 10% more and lose 10% of your clients you will still be making the same money AND have 10% of your time back to find NEW clients who will pay you your worth.
Remember it is easier for your clients to stay with you with a small increase than it is to start fresh with a new supplier / professional / product.
If you are wanting to work with a bookkeeper who is able to assist you in confidently charging what you, your products or service are worth, I Invite you to reach out to me so we can have a chat and see how I can help you.
The Imposter Bug
As a business professional in “Professional Services”, have you ever advised a client on your rate and immediately given a discount or dropped your price… without them even asking?
WHY do business owners do this?
Often it comes down to Imposter syndrome!!
Imposter syndrome is loosely defined as doubting your abilities and feeling like a fraud.
Maybe you feel like this?
Maybe you know someone else who feels like this?
And perhaps you have been on the receiving end of a “here’s a discount” comment.
This is typical of a business professional who, as I say, has been bitten by “The Imposter Bug”.
If you were on the receiving end what went through your own mind? Probably something like “If she thinks she’s not worth it, why would I think she’s worth it?” Can you see how easy it is to devalue what you do?
When you consider your rates, the elements that you should consider, the elements that play a role in how you price your services, I believe should be based on this statement… “how you are able to help someone do something right the first time, quicker, more efficiently, saving them money.” What is that worth to them?” Do you agree it is ….. priceless!
You may think “hey this will literally take me 10 minutes; I can’t charge too much”. The truth is you are not charging for the time you spend DOING whatever it is you do; you are charging for the years of qualifications and experience as well as the time and money that you will save your clients.
If you are feeling the “Imposter bug” biting, I would love to meet with you and see how I can ensure that you are charging what your worth without hesitation.
Reach out to me, lets book a coffee catch up.
What is your hourly rate …. And is it worth it?
As a business professional do you charge what you’re worth on a monthly, weekly, daily or hourly basis?
If you say “probably not” you are not alone.
As a business owner this is an essential element in setting yourself and your business up for success.
It’s not about product or stock, but YOUR actual hourly rate.
Often business professionals under charge for their time as they are afraid of not getting new business and possibly losing current business.
There are 3 numbers that you should know to ensure that you are charging what you are worth
- Do you know what your hourly cost is?
- Are you paying yourself a fair, market related wage?
- Are you making a reasonable profit per hour?
Let’s explore these in a little more depth
- Do you know what your hourly cost is?
Your standard hourly costs can include hourly expenses such as contractor and employment costs.
However, you also need to include all of your overheads such as rent, rates, electricity, cleaning, insurances, memberships, registrations and licences.
Other costs to factor in include training costs, marketing expenses, conferences, travel and certifications.
Your bookkeeper should be able to assist you in establishing an actual “per hour cost” for running your business.
- Are you paying yourself a fair, market related wage?
Perhaps you are paying yourself a salary… or maybe not because “the business can’t afford it.”
When establishing your salary, it should be market and experience related. The question to ask is, “if I had to employ someone of my calibre to do THIS, what would I pay them?
If the business can’t afford to pay that then it’s not a business… it’s an expensive hobby!
- Are you making a reasonable profit per hour?
This may depend on your business goals.
The starting point is establishing where you want to go and by when.
Next establish where you are.
Now develop a road map to get you there. Ultimately your profit should be able to get you to where you want go within that time frame.
Once you know what your hourly rate is, ensure you are paying yourself a market related wage and are making a reasonable profit per hour you are well on your way to setting yourself and your business up for success!
If you are wanting to work with a bookkeeper who is able to assist you in answering these 3 critical questions, I invite you to reach out to me so we can have a chat and see how I can help you.
