How much money are you making from your business? How hard are you working for that money? Are you trading dollars for hours? These are all important questions to ask yourself and most often they lead to one important decision. It’s time to raise your rates.
Unfortunately many business owners struggle with this concept. They fear that raising their prices will make them lose money rather than make it. This is a mindset problem and one that needs to be overcome. The first person you need to be able to convince about a rate increase is you.
#1 Your Ideal Customer
Who is your ideal customer? Is it someone who wants to get the world handed to them for less than a dollar? You know who those people are and you’ve probably dealt with them in your business. They’re not much fun to work with. They nickel and dime you at every opportunity and complain often. Raising your rates will automatically weed out these people for you. You won’t have to deal with cheapskates anymore. That doesn’t mean your new customers won’t want to get great value for their money. There’s a difference between wanting good service and products versus being cheap. Raising your rates helps you attract your ideal customer.
#2 You’ll Make More Money
Many business owners fall into the trap of essentially working for free. When you break down how much you earn on an annual basis and the amount of work you actually put into that year, you might be astonished. If you work 40 hours a week and earn $50,000, you’re only making $24/hour. Let’s face it, many business owners put much more time than that into their business and make less. Calculate what your time is worth and then charge accordingly. You’re supposed to make money when you own a business. It’s a good thing.
#3 You’ll Stand Above Your Competition
When comparing services or products, people naturally assume that the higher priced item is better – even when it isn’t. Of course, your product or service is better than your competition’s. Price competitively by charging more. Don’t worry that you’re more expensive than them, you’re better and your customers appreciate that.
You are a proud business owner who takes great pride in your products and services. Do yourself a favor and raise your rates. Once you’re convinced the rate increase is justifiable, your customers will be an easy sell.