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Pricing Your Product or Service
11. Trading Up
11.1 Work out realistically how your customers would react to higher prices.
- Would you lose volume - or customers?(Remember lower volumes at higher margins can still improve profit.)
- Discuss it with customers beforehand. The key to success is having a good relationship with them in the first place.
11.2 Sell yourself.
- Make sure customers know why they are buying from you rather than a competitor.
11.3 Explain the reasons behind your prices.
- Remember to attribute part of your price to the cost of providing high-quality back-up and after-sales service.
11.4 Unreasonably high prices can destroy goodwill, especially if the customer has no immediate alternative supplier.
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