10 Common Pricing Mistakes ….

What a great topic….with today’s upward pressures on the prices of many commodities…and the continued devaluation of the dollar all but assuring us of an inflationary period on the horizon.

I just received and read a white paper on the 10  Common Mistakes that Companies make in pricing their products and services by Dennis Brown….with contributions from others….and yes, as

always I am adding my comments.    It is a good thought provoker as “Price Strategy” in volatile economic times can not only impact your bottom line…but the viability of your company!
Mistake #1 )  Basing your PRICE purely on your COST… without consideration of the Customers Perception of VALUE.   Costs should ONLY be considered for the LOWER BOUNDRY of your PRICE!  VALUE should set the UPPER limit and your regular business transactions will find a median in between…..but do NOT base price completely on COST.  You can’t win that game!

Mistake # 2)  Basing your price on the “marketplace”  …or the collective judgement of the value.  If you use this method…you will be asking for and accepting the commoditization of your product.

Mistake # 3 ) Maintaining what YOU feel is a fair margin across ALL product and service lines.  That simply is unrealistic and dangerous…you will lose some product lines all together as you will be priced out of the market….and others you will be selling for too little…. This is further complicated by the fact that you should have “different prices” for different customers….one size does NOT fit all.

Mistake # 4)  As above ….the last sentance….”one price does NOT fit all”  do not FAIL to segment your customers and their respective pricing levels.  You must consider the factors of EACH customer.

Mistake # 5)  Holding prices …no matter what….even if costs go up or down…or clients change in size or ability to pay.  Educate your clients about the market…prepare them for price increases by sharing the information….it makes accepting the increase much easier if they have seen the documentation for months showing the raw material increases.

Mistake # 6 )  Incentify  your sales force on REVENUE and not CONTRIBUTION!   If you do NOT base your commission plans on CONTRIBUTION…you can quickly grow yourself BANKRUPT with a couple of superstar reps!

Mistake # 7 )  Changing prices without any consideration of what the competition is doing.  If you find yourself raising prices just as your competitor rolls out a major discount….well..you can understand your customers reactions.

Mistake # 8 )  Spending insufficient resources managing your pricing.  Don’t get caught in the “set it and forget it” program…. you must have several sets of eyes working with pricing…estblishing, checking and verifying.  Use HARD DATA from the field and from professional resources.

Mistake # 9 )  Failing to establish internal procedures to optimize prices.  A hastily called “price meeting” is a great way to lose money.  Discipline your approach, research, review, prepare and then provide the data and analysis to support the pricing you institute.

Mistake # 10 )  Spending most of your time servicing your least profitable customers.  Why does this happen?  But we all fall victim to it….it is probably our insisting to ourselves that we can “turn it around” over time….but really what ends up happening is that we get RAN OVER time after time.  Know when to fold um…..

And the BONUS # 11….Don’t only rely on your sales force and customer service people to provide you with the VALUE PERCEPTION of your clients.  Customers simply will NOT BE FULLY HONEST with their reps….they LIKE THEM..and as such will “sugar coat” ….. Employ a  trained professional or organization to establish these values from time to time.  The VALUE to you and your organization will be multiplied many times over.  You will get the REAL STORY!

With the above considerations when you are working with prices are included and implemented, your “pricing strategy” will be far more PROFITABLE and VIABLE over the long-term
Ok that is it for this week….Havea  wonderful rest of the weekend….  till next time !

Euby

15 Ways to encourage business to come to you !

Good Saturday morning to everyone!  Just finished a great read in Advantages Magazine by Jennifer Vishnevsky…..15 Ways to Make Business come to YOU !

As sales people we spend a great deal of our time and energy chasing the business…as we all should!  However, if we can “market” ourselves, products and

organizations more effectively and have the “business come to us”….how much more could we sell?    Take a few moments and think about these 15 “tools” that

we can all use to our advantage….and have business come back to us!

1)  Email…Send “targeted” emails and the orders will come!

2)  Magic…. OK not all of us are magicians…but we all have “talents” …if you are doing ANYTHING as a hobby or “gig” ..incorporate a little “sales” into it!  It will provide more prospective business!

3)  Get your NAME in print… Don’t be shy…tout yourself, your products and company in new bulletins or story lines to industry magazines and on-line sites.  BLOG ( now who does that regularly ? ) etc.

4)  Social Media…. USE IT !  This blog will go to my Facebook and LinkedIn accounts…. why not?  You should also have a “brief commercial” in your profiles on both!

5)  Obtain Certified “woman owned or minority owned business” if applicble…there are MANY companies that seek them out!

6)  Attend Business Roundtables and participate!

7)  Identify anything that is “stopping you” from selling…and make adjustments to correct!

8)  Used “gated” content..Write a “white paper” and place it on your website…have a “catch title” like   Five Tips to Success!.

9)  Write a short book on your industry and have it digitally produced and “leave it behind” with you clients and prospects!

10)  Make yourself available as a speaker …and participate in speaking events !

11)  Teach…. Offer to “teach or speak to” a class at the local university or community college

12)  Offer to “Guest Write” to blogs or Websites…. ( I would welcome a guest blog here at the Euby blog ! )

13)  Create Compelling Content….from the headline to the information provided.

14)  Get active on-line… PARTISIPATE….BLOG…. respond to your peers on lists or groups on-line!

15)  Euby’s Favorite….ASK for referrals !  There is nothing more powerful than a “trusted friend” of a prospect introducing you!

Ok there you have it…. 15 ways…to send business YOUR WAY!  Thanks to Jennifer and Advantages for a great thought-provoking

read that sparked a few “Euby thoughts” above….even on a early Saturday morning.  Have a great weekend !   Euby

PSDA Print Solutions in Baltimore … Quality over Quantity ! Great ROI !

For those of you who made the trip….you know exactly what I am talking about in my title line above!

PSDA Print Solutions in Baltimore provided those of us in attendance with a unique experience due to

some scheduling conflicts that were unavoidable due to legacy contracts and agreements. …..  BUT….

( always pay close attention to the words that follow BUT ) due to the lighter traffic than normal….those

in attendance had QUALITY time in the booths….distributors had TIME to speak with the suppliers and

the suppliers had time to really access the areas where they could build their business with the distributors.

“No Lines…No Waiting” kept popping into my mind…. Suppliers excited to see the next person…and very

few interruptions.  I learned more about my current ( and new suppliers ) in the two days on the show floor

than ever before.

The Education provided was outstanding….with many options to choose from….and the LinkedIn marketing

presentation provided my ROI in one session!

The 3 new incoming board members were officially announced and joined in their first board meeting headed

by Joe Webb immediately following the closing of the event!  Joe and the new board have a lot of work ahead of

them and a hard “act to follow” after the incredible achievements during a most challenging time under the leadership

of President Prettyman!   But they are up to the challenge…. and are already off and running !   As we progress thru this new

board year….I will keep you updated via the Euby Blog!
Have a great Fathers Day !  Be sure to wish your father and all fathers a very special Fathers Day !        Euby