How often have you felt uncomfortable about naming your prices? Perhaps even offering a discount before your client could say yes or no? I know, many small business owners do this. We love what we do, create beautiful products and services, but we don’t value ourselves enough. We don’t. And then when someone shows an interest, and they are not immediately buying, we are all too quick to jump in with a discount. Don’t do this. Today I will share a story about why this is unnecessary.
A few months ago, my husband and I bought a house. And as often is the case when you move into an older property, you need to do it up. So we redecorated, changed the rooms and bought a new kitchen. We also needed new tiles.
Don’t think the client thinks like you
I went tile shopping, and after being disappointed with the choice in the big DIY stores, I went to a small local business, which was specialised in tiles. Their choice was much better, and I was impressed with the gorgeous styles and quality of tiles available. I expected the tiles to be much higher priced than the high street stores, and I waited for the shop owner to give me the quote. I got a surprise. The price per square meter was lower than similar quality tiles in the big DIY store, and so I quickly made up my mind: I was going to buy them.
However, before I could say this, the shop owner became all apologetic, because he thought they were not affordable at all.
“Oh” he said, “These are quite expensive”. “I have others that are lower priced if you want to see them.” I looked at him puzzled, as I didn’t think they were pricey at all. This goes to show, you can never assume what your clients are willing to pay.
Today, I contacted him to place the order. 6 m2 of the beautiful ‘expensive’ tiles I had selected. “Oh”, he said. “Since it will be a single order from the factory, I am sorry but there is a shipping cost involved.” He named the cost, and I though, that’s OK. But once again, the man was all apologetic, and before I could even respond, he offered to split the cost of the shipping 50%.
I thought it was ever so generous of the business owner to be so forthcoming, but it was completely unnecessary to do so, because:
- I had already made up my mind that the tiles were the right ones, and the price was OK.
- Because we were in a little bit of a hurry, I accepted the shipping cost as part of the deal.
Add value through customer service
The thing was, I would have happily paid double.
The shop owner was friendly and helpful, and he gave me personal advice. I felt looked after. His assortment in tiles was impressive, and he had the right ones for us. His prices were within our budget and we were happy to pay them – including the shipping costs.
Do you recognise yourself in the behaviour of this man? Are you feeling awkward to name your prices? Do you go over and beyond to keep a customer happy and get a sale?
Do you overdeliver and undercharge?
The message here is clear: don’t assume that your customer has the same scarcity mindset as you have. What you may find expensive, another person finds affordable.
And instead of offering discounts, it is often better to add in a little gift, a bonus, or just extraordinary customer service.
Don’t undercharge and overdeliver. Charge properly, and deliver accordingly.
