If you’re in business, chances are you’ve been in a situation where you’ve felt the need to undersell your services to compete. Maybe a potential client has told you that your rates are too high and they can get the same thing for less elsewhere.
Or maybe you’re starting out and feel like you need to lowball your rates to get any business at all. Whatever the case may be, it’s important to know your worth and not sell yourself short just to compete. Here’s why.
When you undersell your services, you’re essentially telling your potential clients that what you have to offer isn’t worth what you’re charging. This can damage your reputation and make it harder to get future business. Furthermore, when you underprice your services, it sets a precedent that can be hard to break later on down the road. Once you’ve established yourself as a “discount” service provider, it can be tough to convince clients to start paying full price—even if your rates have gone up due to inflation or increased overhead costs.
Additionally, underselling yourself can lead to financial problems down the road. If you’re not making enough money to cover your costs, it’s only a matter of time before your business starts struggling. And once that happens, it becomes even harder to attract new clients and keep existing ones happy. So how do you know what you’re worth? Start by taking a close look at your overhead costs and factoring in things like employee salaries, benefits, rent, utilities, marketing expenses, etc. Then, take a look at your desired profit margin and use that as a guide for setting your rates. And finally, don’t be afraid to ask for help from a professional pricing consultant—they can provide valuable insights into what others in your industry are charging and help you come up with a competitive price that meets your needs.
By taking these steps, you’ll be better equipped to price yourself competitively without selling yourself short—and that’s good news for both you and your business!
