Change can be difficult; sometimes it's much easier to carry on as we are and not try to rock the boat. However, when it comes to pricing it's not a good idea to stick with the same old, same old (or, indeed, to bury your head in the sand).
Strategic pricing sets a product's price based on the product's value in the eyes of your customers (or potential customers) rather than on the more usual cost of production plus a markup.
If your end of year results turn out to be poorer than expected, is this always the time to change your pricing strategy?
Topics: Pricing Strategy
None of us are perfect and we all make mistakes - come on, even you!! Well, some mistakes can be quickly mended but other mistakes cost us money and when it's your livelihood that's a very serious matter.
- How do you know if your pricing strategy is working?
- How do you know if the prices you have set are the best prices for your goods or services?
- When was the last time you made iterative changes to your pricing strategy to test if that made a difference to your overall profitability or revenues?
- Are you reliant on traditional pricing strategies such as cost-plus pricing?
Pricing can be one of those topics that is often ignored. No matter whether your profits and revenues are growing, or your business is declining, you can always fine-tune your pricing to increase your margins.
So, your business has made the decision to implement a pricing tool such as BlackCurve. Fantastic! You’re well on your way to get an average 1% - 3%+ gross margin improvement.
This is because pricing tools help maintain pricing accuracy, make the pricing process more efficient and effective, as well as help you identify better price points for your goods and services that drive overall business growth.
Pricing is a journey, and you should always be looking to tweak and fine-tune your pricing, as well as seeking to understand if your overall pricing strategy is working. This post covers 9 indicators that may be telling you it’s time for a change in your pricing plan.
Topics: Pricing Strategy
Pricing strategy can be challenging, complex - and offers no shortcuts. Unfortunately there is no magic wand to wave nor just one pricing strategy that will produce the greatest profits under ALL conditions.
When two products or services have similar core features, but are produced by different companies, competition results.
A competition-based pricing strategy involves setting your prices based on your competitors’ prices rather than on your own costs and profit objectives. If there is a close gap between costs and the actual selling price then there is going to be an even greater competition on price.
In a perfect world there would always be a larger margin between costs and selling price to comfortably increase your profits – but, stop press, it's not a perfect world!