Are you focused on pricing for profit or just doing what everyone else does?
When setting prices it’s easy to just focus on being like everyone else, but that may not fit your business. It may not bring you the profit you need. It might not even satisfy clients. The right prices are more than just doing what everyone else is, it’s about doing what’s right for your situation…for your business and clients.
In this episode of Live With The Pricing Lady, I dive into the most common pricing pitfalls service-based businesses face—like overly focusing on the competitor, fear-based pricing, and time-focused models—and reveal how to shift towards a more sustainable, profit-driven pricing strategy.
I’ll walk you through key strategies like value-based pricing, project-based models, and retainers, so you can create sustainable, profitable pricing that supports your business growth. Plus, I’ll share insights on building confidence in your pricing, communicating your value effectively, and avoiding scope creep.
Remember profit-based pricing doesn’t make you greedy it makes you smart. Don’t let doing the right things hold you back from business success!
Tune in to Live With The Pricing Lady your pricing podcast and start pricing for profit today.
What to Listen out for:
- 00:43 The Importance of Profit-based Pricing
- 02:58 Common Pricing Pitfalls
- 09:22 Strategies for Profit-Based Pricing
- 15:06 Overlooked Aspects of Pricing
- 18:53 Tips for Effective Pricing
- 20:51 Conclusion and Final Thoughts
Favorite quotes from this episode
“Pricing confidence comes from understanding customers, your offer, the value that offer brings and communicating those prices and the value effectively.” Janene
“…make sure you’re looking at and doing the right things, so your pricing strategy is helping and making it easier for you to meet your business objectives, like profitability.” Janene
“Many services providers (especially women) are good at undervaluing their expertise and saying things like I don’t care about the money.” Janene
”If you are doing competitor based pricing, you want to make sure that you’re comparing to like competitors and competitors that are successful.” Janene
“No matter what price you set, high, low or in the middle – there will always be people who say “no thank you”. And that’s ok. Prepare for that.” Janene
“ You have to stop being afraid of losing clients and just focus on getting the right clients in the door.” Janene
Episode Links
The Fair Price Formula: https://maven.com/the-pricing-lady/fairpriceformula
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Get started improving your business. Beyond this pricing podcast there’s more for you to explore. Sometimes it’s difficult to know where to begin. I suggest you Download the the self assessment Pricing Scorecard to get a view of what’s working and not in your business. Ever wondered, “What’s a fair price?”, check out my on-demand webinar “Getting to A Fair Price“. Two great places to get started with pricing in your business today.
Get in touch with Janene, your Business Strategist & Pricing Expert. If you’ve got a business question that needs answering, a pricing challenge you’re facing or you have suggestions for future topics or guests, let me know. Your questions and insights often become episodes. Share yours with me and let’s see where it goes. Contact Janene.
Transform your business and life. My mission is to help you build a more sustainably profitable business. One where you can confidently charge for the value you deliver. Curious about my coaching and consulting offers, check them out. Let’s see how we can work together. Book a complimentary Call today!
Podcast Overview
In this episode of Live With The Pricing Lady, we’re diving deep into pricing strategies tailored specifically for the service sector focusing on pricing for profit. As entrepreneurs striving for financial freedom, it’s easy to overlook how much pricing influences our business success. I’m Janene Liston, your guide on this journey, and today, I’ll help you navigate the nuances of setting prices that support profitability and empower business growth.
Understanding the Impact of Pricing
Pricing is one of the most critical elements of a solid business strategy, yet it often goes underestimated. In my experience, pricing should be a direct reflection of the value you provide. It’s a key driver in meeting your profitability goals. Unfortunately, many businesses, particularly service providers, stumble into common pitfalls that limit their potential. Pricing with profit in mind isn’t optional it’s a sign of a savvy business owner.
Common Pricing Pitfalls that Mean You Aren’t Pricing for Profit
Pricing should be based on the unique value you provide, not just competitor rates or hours worked. Simply copying others’ prices can mean lost revenue, while underpricing out of fear—whether of losing clients or seeming greedy—can also hurt profitability. Confidence in the value of your offer is key. Additionally, relying on hourly rates can be limiting, as increased expertise allows you to work more efficiently. Shifting to value-based pricing ensures better profitability and long-term business growth.
Key Strategies for Profit-Based Pricing
Pricing should be aligned with the value and outcomes you deliver, not just the process. Project-based pricing ensures transparency by setting clear costs for specific deliverables, creating fairness for both clients and providers. Retainer agreements offer financial stability through a fixed monthly fee, fostering long-term client relationships and predictable income. Adopting these approaches helps maximize profitability while ensuring clients see the true worth of our services. I share with you three possible approaches you can use in your business.
Overlooked Aspects of Pricing
Confidence in pricing is essential—if a business is uncertain, clients will be as well. Establishing a strong understanding of value and effectively communicating it builds trust and reinforces pricing decisions. Clearly outlining the return on investment (ROI) helps clients recognize the tangible benefits of their investment. Additionally, avoiding scope creep is critical when shifting away from hourly pricing. Defining deliverables upfront ensures that additional unpaid work does not reduce profitability, allowing for sustainable and fair pricing.
Tips for Shifting Your Pricing Mindset
Businesses should regularly evaluate their pricing to ensure it accurately reflects the value they provide. Testing different pricing strategies can help identify the most effective model for both the company and its clients. Seeking feedback is also crucial, but it should come from trusted clients or mentors who understand the business’s unique dynamics, rather than from those who may not have relevant insights. This approach ensures that pricing decisions are well-informed, sustainable, and aligned with long-term success.
In Conclusion
Pricing is more than just a number—it’s a strategic tool that should align with our business goals and the value we provide. By refining our approach to pricing, we can build a profitable and sustainable business model that serves both our clients and our growth objectives. Remember, pricing can either hold us back or propel us forward—let’s make sure it’s working in our favor.
Subscribe, rate, and review the Live With The Pricing Lady your pricing podcast for service based businesses, for more insights. I’d love to hear your thoughts, questions, and topic ideas—connect with me at thepricinglady.com. Remember, pricing is a continuous journey, and together, we’ll make sure it leads to success!
