TapRun Consulting

The Pricing Newsletter

April, 2018 issue

Hello there!

Let's start this month's pricing newsletter off with a two-part joke:

  1. What do April showers bring? Mayflowers!
  2. And what do Mayflowers bring? A potential customer base to be exploited by vendors who are willing to target their messaging to pilgrims.

OK, maybe I'm not ready to appear on an HBO comedy special, but the message is clear. As business owners, analysts, and salesmen, we always have to be focused on our customers. Understanding who they are, what they need, and how they think is the key to finding success in the business world.

Pricing question from a reader

Today's question comes from reader G. L.

I'm starting a service-based business, and I'm having a lot of trouble coming up with productized offerings. It's not that I don't know what customers want. It's just that I have no idea what to charge. Each job is going to be very different, so I don't know how much I should be asking for each package. Can you give me some hints?

Packaging your services into predefined options is a great idea.

It helps you by simplifying your sales process, and it helps your customers by simplifying their decision-making process.

As you are a new business owner, I'm willing to bet that many of your assumptions will probably change as you gain experience, knowledge, and a loyal customer following. What I can tell you is that many entrepreneurs fall into the trap of undercharging for fixed-fee, poorly-defined work. As a result, they find themselves stuck on projects that never end and making very little for their efforts.

I'd suggest thinking about answers for the following questions:

It's nearly impossible to figure out a perfect pricing strategy right out of the gate. Fortunately, you don't have to do that. As a service-based professional, you'll learn more about your customers, their needs, and how you can help them as you go. Packages that might not occur to you now, may become obvious to you in a month or two. Instead, focus on sustainability while you keep an eye out for commonalities in customer needs.

The more often you see commonalities, the more likely you'll be able to create standard offers, grow your business, and reduce your risk.

Questions come from readers like you. If you'd like your questions answered, send them my way.

Pricing in the news

Pricing article from the blog

Notable pricing quote

"It's great to make your own choices, but there's a price to pay. I could've made more money or been more famous. I could be the current groovy guy. " -- Michael Keaton

Shameless commercial plug

Need help with your pricing strategy? Don't believe my birth certificate. "Pricing" is indeed my middle name. Contact me today.

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