Lagerquist Accounting Blog
Read the latest blog articles from Lagerquist Accounting and Advisory.
Subscribe for Blog Updates
Recent Blog Articles
How an Outsourced CFO Can Help You Establish Accounting Practices To Minimize Risk and Maximize Profit
An outsourced CFO can provide your small business with the accounting services and financial management advice you need to successfully navigate from your break-even point, so you can maximize profits and boost ROI.Read more
Leveraging the Expertise of an Accounting and Advisory Firm to Support and Optimize Your Accounting System
This fourth article in our series outlines the benefits of partnering with an external advisory firm in optimizing your business finances. We look at the comprehensive services offered by outsourced accounting specialists and how they can support your in-house teams and processes toward ideal results throughout the work year. Bookkeeping is an essential aspect of […]Read more
Lagerquist’s third part of an in-depth blog series explores how partnering with a reliable external accounting and advisory firm can help your company avoid five of the biggest pitfalls faced by businesses. External accounting specialists provide extensive real-world experience that help companies navigate the most significant financial challenges with minimal guesswork.Read more
Pricing: The Fuel for Your Revenue Drive
Posted by Lagerquist Accounting & Advisory
Pricing goods and services is a point of severe tension for businesses. Too high and you fear turning buyers away. Too low and you make no profit. So you aim for “just right.” What is “just right?”
Before I show you what “just right” is, here is what it isn’t: “Just right” is not about fairness, in the sense that all buyers either pay the same price, or get the same value for whatever they pay.
“Just right” is the price or fee that gives the buyer value commensurate with the money they pay.
Value is variable, thus prices should be variable too. You are not going to give the highest possible value to someone who pays the lowest amount. And you better give much more value to the buyer who pays the highest amount.
When I work with executive owners, we look at the range of offerings they have on the market and we dive into the value of each offering.
- Common offerings provide utility or satisfy a short-term need. Those have the lowest value and therefore the lowest prices.
- Uncommon offerings are more useful and longer lasting. They give the buyer more satisfaction through the buying experience and with service afterwards. Uncommon offerings have the best chance of generating Regulars: repeat purchases and loyalty to your company.
- Exceptional offerings carry very high value to the buyer. The value includes ‘tangible intangibles’ such as status, reputation, superior service, convenience, and a highly personalized buying experience. These buyers are your Enthusiastic Fans and are eager to buy new, high-value offerings customized for them.
Getting pricing and fairness right begins with your strategy. Strategy is “We provide X to Y buyers.” You can have several offerings and buyers, making strategy look like this:
- We provide X to Y buyers.
- We provide X+1 to Y+1 buyers.
- We provide X+2 to Y+2 buyers.
And so on.
What makes this work? Knowing the value of your offerings and who the buyers are for them.
Do you have a nagging worry that your pricing and array of offerings are cheating your company from the revenue and profit it deserves?
What’s next for your company? Where will you apply relentless focus in the coming 3-6 months?
- Maximize revenue per customer or client
- Maximize revenue per employee
- Accelerate top line revenue growth
- Improve sales cycle speed and volumes
- Build wealth for owners
- Alleviate the major stress of owners: the business controls you instead of you controlling the business
My clients see that their dramatic results come from a a relentless focus on these Focus Areas, one or two at a time. Pick one or two and begin today!
Guest blogging content is provided by Susan Trivers, MBA, principal of Trivers Consulting Group. Susan focuses on six areas that put revenue in the fast lane for business owners. View original article here.
Image Credit: smemon (Flickr @ Creative Commons)
Lagerquist Accounting Blog
Welcome to the Lagerquist Accounting & Advisory Blog.