Taking the fear out of putting up prices with Sally Farrant

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How do you feel about pricing?

Do you feel comfortable and confident when it comes to what you charge or is it something that causes you stress and worry?

In this episode Sally Farrant – aka The Pricing Queen – talks about what gets in the way of us putting up our prices.

She explains what the biggest pricing challenges are for business owners and how to overcome them.

And she shares how to price your product or service in a way that you attract the right kind of customer who isnโ€™t going to quibble about what you charge.

We also talk about the emotional side of pricing and how being questioned about what we charge can affect our feelings of self worth.

You can listen to Sally’s insights on the player link below or carry on reading as a blog post.

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Sally is a management accountant and has worked with large corporate organisations but now helps small businesses get clear on pricing.

She finds the biggest challenge is knowing your worth and what to charge to make money.

What you should charge as a business owner versus what you earned as an employee

One mistake we make when working for ourselves is to not factor in the costs of running a business.

Sally says: โ€œWork out what your price per hour and price per day is. You should say, โ€˜How many actual client hours do I want to be delivering?โ€™ย 

โ€œBecause when you’ve got your own business, you’re not delivering to the client all the time, you might be working five days a week.

โ€œBut on Friday, you might do all your admin and marketing. So you’re only working four days in front of the client and the price needs to reflect this.โ€

Your hourly rate will need to include what you need to make in your business, plus your costs

Sally explains: โ€œThis means your hourly rate goes up, and you want to earn more than you did before.ย 

โ€œYou have to take into account how many holidays you’re going to have, cover for if you fall ill. So it needs to be at least 20 per cent more than what you may have earned as an employee.โ€

Most business owners get a shock when they sit down and look at the numbers

Sally says itโ€™s common for people to hide away from the numbers.

She said: โ€œMost people say they know that they’re under charging. But they’re frightened of putting them up and losing existing clients.ย 

โ€œThat’s usually the biggest problem – they need to be upping prices a lot and that can be hard with existing clients.

โ€œThe first thing to do is put prices up with new clients. Theyโ€™re at the new rate, they didn’t know that there was another rate – so that’s the easy bit.โ€

To take the pain out of price increases, Sallyโ€™s advice is to do them regularly

โ€œThis means big increases don’t happen,โ€ she says. โ€œGo to your nicest clients, the ones that love you.

โ€œThey do not want to go somewhere else – the effort of finding someone else to do the work that you’re doing is way more than you anticipate.

โ€œAlmost nobody says that they don’t want the price increase as long as you’re reasonable about it. Most clients will accept this.โ€

With pets, like with children, itโ€™s often more about the relationship than the price

Our pets are precious, theyโ€™re our family, and people want to know they are safe, happy and well cared for says Sally.

โ€œThis is more important than cost. We want to know will the person caring for them be reliable? Will they turn up? Will your dog be exhausted when they get back and happy?ย 

โ€œAre they going to take them out for country walks? Or is just walk on a lead around the block.ย 

โ€œAll of those things really make a big difference to how you feel about somebody.ย 

โ€œIn business you build a relationship, you spend time training them getting them to understand how you work so they want you, not someone else.โ€

While it can be tempting to discount, try to hold out when stating your price

Even during times like Black Friday, when it feels like everyone is offering deals, Sally says tread carefully.

โ€œI thought about doing an offer for Black Friday, and I was going to do Power Hours, but then I stopped myself as I havenโ€™t got time to deliver them.ย 

โ€œIt would be doing me a disservice and the clients to offer those at a discount, because I’ll get a flood of them.

โ€œIf youโ€™re a product business, you might have things that you are trying to get rid of, or are very popular, and you can offer really good bargains on.ย 

โ€œWith services, you might discount a pre recorded master class. So you might have sold that already and can be put it in your shop so people can still buy it.โ€

When people say they canโ€™t afford you, try to offer a solution

Rather than feel like a door has closed, try to offer something for a lower price point.

Sally explains: โ€œCan you go down a level? What could you offer them? If you got a group programme or package?ย 

โ€œOr rather than the whole package, what is the most critical thing that needs doing now? So if it’s a project, is there something you could start with?ย 

โ€œIf itโ€™s dog walking, could it be once a day, not twice a day? Or a group walk, or a shorter adventure?

โ€œTry for two or three key packages so if someone says โ€˜noโ€™ at one level, there’s somewhere else for them to go so you don’t lose them.โ€ย 

For product businesses factor in all your costs like PayPal fees in the price

Sally says PayPal is vital so customers donโ€™t have to โ€˜get up off the sofaโ€™ as this can stand in the way of them buying from you.

She said: โ€œThe rates are higher but the amount of people that checkout via PayPal is amazing, because they can click a link, and buy it through PayPal.

โ€œA lot of people don’t like to save their credit card details everywhere. It can be a bit of a no brainer to have PayPal. So make sure that you’re calculating the fees at the higher rate.โ€

Social proof also comes in handy when we feel we need to justify our worth

If youโ€™re working with huge pet brands and youโ€™re getting amazing transformations, make sure people know about it!

Sally explains: โ€œLetโ€™s say you’re an expensive dog walker – you do the extra training or solo walks.

โ€œIf youโ€™ve got your social proof, so testimonials and other content on your website along with your rates, you will deter people who are price sensitive.ย 

โ€œYou might say, โ€˜Well, that puts people off,โ€™ but then you’re not putting off the people you want, youโ€™re putting off the ones who arenโ€™t right, who donโ€™t value you and see why youโ€™re special.โ€

The key is to attract people who see what you offer as a priority

Just as one person might happily spend ยฃ200 on a haircut, another would rather spend ยฃ30 and with products and services for our animals, itโ€™s the same.

โ€œPets are part of the family, so they will be a priority,โ€ says Sally. โ€œBe careful of what you see as a priority or not compared to your customer.ย 

โ€œSo while you might think it’s a lot of money to spend ยฃ50 on a bandana and lead set, they might not see that at all.โ€ย 

Links mentioned in this episode:

Sally’s website: www.businessgrowthbynumbers.comย 

Check out her blog: www.businessgrowthbynumbers.com/blog

Follow her on Instagram: The Pricing Queen


If you found this helpful, check out: How to feel more comfortable and confident promoting your pet business and Why every pet business should have a win folder

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