Your Prices Could Be Higher

Don't let fear stop you from setting prices that serve you and your customer.

Here are a few of the things I've heard over the years from entrepreneurs as it relates to setting prices. In the Caribbean context, it is never about fearing being too cheap but rather being too expensive.

"People will think I'm greedy." - Many people associate riches with being wicked and greedy or with the bible verse "the love of money is the root of all evil." This isn't about loving money but needing to be paid appropriately for the value you are delivering and the cost of producing the service/product and making enough to be able to continue offering the service/product.
"Noone will buy it at that price." - Keep out d people dem pocketbook. Do your research. Ask the market (not friends and family) what they believe is a reasonable price for the service. Where does your product fit in based on what the market says?
"People don't have a lot of money, so I didn't want to make it too expensive." - Keep out d people dem pocketbook. Does your product/service solve a real or perceived problem in the marketplace? You may want to help everyone, but you don't have a business if customers don't want what you are offering. The problem you are solving also needs to align with the customer who can afford to pay for it.
"That other one is really expensive, so I wanted to make sure mine was cheaper." - Unless you intend to create a bargain basement product and you are okay with everyone believing that your product is cheap and low quality, then by all means, be the cheapest. Be the cheapest because you can get the product to market with all your expenses covered and still deliver a quality product. Consider whether you can keep production costs low the more the demand grows. Set your prices with growth in mind.

Your price is a key part of your marketing. It tells us how you are positioned in the marketplace. Bargain, Mid-Range or Luxury.

Ever heard you cannot serve two masters? Pick your spot and own it.

Categories: : Entrepreneurship, marketing, pricing, business