Unlocking Your Worth: The Power of Value-Driven Pricing
Are you tired of undercharging for your products or services? Feeling undervalued and struggling to maximize your business’s profitability? We understand the frustrations and challenges you face as a business owner. At WinRate Consulting, with over five years of experience helping entrepreneurs like you, we’ve witnessed the transformative impact of value-driven pricing strategies. In today’s article, we delve into the importance of recognizing your worth and aligning it with the prices you set. Join us on this journey of discovering the key to sustainable business growth and success.
The Pitfalls of Undercharging and the Importance of Fair Pricing
This was probably the first time, I would say, I went viral on the Facebooks. I made a post, I think it was Saturday, about a transaction I had with the guy in Charlotte who detailed my vehicles. So this post I made, it starts with, “This is what doing business with friends and good people should look like.” It’s got 218 shares, which is absolutely insane. Look, you might be some crazy influencer out there getting massive amounts of engagement, but 218 shares on a post has got to be one of the highest engaged posts I’ve ever made. But let me give you a little background on the story. So I’ve been using the same guy. He’s a small business owner, has a brick and mortar location to detail my vehicles. I wanted to deal with somebody beyond just the neighborhood guy that comes in around, charges 50 bucks for detailing. I saw recently that he had increased his pricing. I was like, “Okay, cool, I get it. Businesses everywhere are raising prices. So it makes sense.” I was out of town that week in Dallas for Apex events and Tiff was there alone, so I was like, “Hey man, can you help us out and come switch the vehicles out?” So he showed up, I think a Tuesday night, dropped his car at my house, picked up the Challenger, brought the Challenger back the next day, picked up the Jeep, brought the Jeep back the next day, picked up the truck, brought the truck back, picked up his car.
So he did this over three days, really four days. And so he literally made it possible for us to do business with him that week because Tiff would’ve just had a really hard time being here without me being able to pull that off with everything else she had going on. So huge, huge value. Well, here comes the invoice. From what I saw, he had raised his prices of $300 per vehicle, which I think is pretty fair. I’ve seen higher. He does an incredible job, and he also went above and beyond to come and pick the vehicles up instead of making us drop them off. So I get an invoice for $700 and I’m like, “Huh, that doesn’t seem right. So let me reach out to him.” I said, “Hey, man, I thought it was $300 a vehicle.” And his response was, “That’s my updated pricing. I can’t, in my right mind, charge a good and repeat client that price when I’m doing three vehicles for them.” And if you didn’t see the post, here’s my response, “Fuck that. You’re in business. Business needs to make a profit. You won’t be around to support me if you’re not charging the right amount of money. I’ll pay the invoice once it’s adjusted to the correct pricing.” I see this happen all over the place. This is not just him. He’s incredible. He’s located in Charlotte. If you need his contact information, just reach out to me, shoot me a DM or something, I’ll get you connected. But this is a message to all business owners out there, you have to charge what you know you’re supposed to charge specifically to friends or family. If you are not a business owner out there, stop expecting your friends and family-owned businesses to give you a fucking discount.
Calculating Your Worth and Recognizing the Value You Bring
It’s an epidemic of sorts, but really, here’s what I think the underlying problem is. I don’t think most people understand how to calculate their worth to understand their value. Say it however you want. Their value to understand their worth is probably the right way to say it, understanding the value that you bring compared to the worth of your product or service. I had to do the same thing with our housekeeper. We call her our house manager. She does dishes and laundry and grocery shopping and odds and ends and things around the house for decluttering and all kinds of stuff. And I was like, “Look, this is what you charge per hour, but this is really what it takes. This is really the value that you bring.” If you understand the value you bring to your client base, whether it’s saving them time, saving them effort, saving them money, your worth has to equate to that, or you’re just another discounted service provider that won’t be around that long.
And so I challenge you right now, raise your prices. Everybody in the world is raising their prices right now. If you have not raised your prices in years, you are probably on the verge of going out of business within the next 12 to 18 months. Just look at gas prices. I mean, if you drive at all for your job, or you buy anything from the store or Amazon or whatever, everything’s gone up in price. If you have not increased what you’re charging, do it immediately. I like just, quote, unquote “tiptoeing in”. Raise it by 20%. Give that price to your next 10 to 20 prospects. See what happens. If everybody says no, maybe we need to readjust. If everybody says yes, you probably need to raise it a little bit more and get to that point where you are worth what people are willing to pay you for the value that you bring. Period.
There are coaches out there that charge a hundred dollars a month, and there’s coaches out there that charge 25 to $30,000 a month. It’s all about the value that you bring. I’m somewhere in the middle right now. I’m not at the top, I’m not at the bottom. But when I started, it was like, “What will people pay me?” Now that I have a track record and there’s proof of the value that I bring, I can charge more. That’s over the course of three to four years, but you have to understand the value that you bring. You have to understand the value of that person not having the service that you bring. Let’s just use my house manager, my detail guy here. He saved us 10 to 15 hours last week in transfer of people, transfer of vehicles, doing the actual cleaning ourselves that would’ve been subpar comparatively.
And so if you look at what is the time worth of your target audience. For this guy, he does primarily high-end vehicles. Saving the time of his clients is the biggest thing that he does. And those people with typically, high-end vehicles, they typically make a lot of money per hour. So what are you saving them by going above and beyond to picking up their vehicles and bringing them back and going the extra mile and all that? He’s probably still undercharging me at 300, but hey, that’s his thing right now. He’s got to figure that out, but he sure as hell can’t undercharge somebody who’s using him because of the value that he brings.
Same thing with my house manager. The amount of time she saves us in just the little things like the dishes, the laundry, the cleaning up, the wiping down the counters, the whatever it is around the house, the decluttering of closets. She saves us a ton of time, and she also allows us to spend more of the time that we have doing the things we want to do with our family instead of spending nights and evenings and weekends doing the stupid fucking chores that she does for us. And that for me, it’s stupid. If you like doing laundry, you like doing dishes, whatever, that’s on you. That’s not what I like spending my time doing. It’s not what I like spending my time watching my wife do. So we pay somebody else to do that.
Understanding Your Value and Embracing Your Worth
But no matter what it is you do, whether it’s remodel work or service or product, understand the value that your product service brings to your ideal client, and that should equate to the worth that you charge people. What is it worth to them? It should be worth the value that it brings to them. So if you don’t know what that is, ask people. Ask your previous client, say, “What’s the biggest value that we brought? What did that save you? How much money or time or effort or energy did that save you,” so you can better understand what the value of your product or service is. A lot of times, people can’t imagine not having you. But a lot of times, if you’re just dealing with friends or family, they’re probably trying to see how they can get a deal when they would go… They’re not going to fucking… They’re not buying Jordan’s at a discount. They’re not buying fucking cars at a discount. They’re not buying the shit that they really want at a discount. So stop being the person giving the discount when you don’t have to.
If you know that the dollar figure that you charge is worth it for the value that you bring, be intentional about maintaining that because it’s your job to be profitable, okay? It’s not your job to live up to the expectations of everybody around you from a discount perspective. So know your worth starts with understanding your value. Get out there this week and get intentional. Like I said, if you have not raised your prices in years, you’re already behind the eight ball, you’re already probably on the verge of living paycheck to paycheck, if not worse, you’re heavily in debt. And it’s not anybody’s fault but your own. You can say, “Well, all these people, customers just ain’t got money right now.” Bullshit. Look at fucking NFTs, look at baseball cards, look at cars right now, look at boats and ATVs and all the fucking fun shit. You can’t find it right now.
House prices through the roof. That’s because people are spending money. So don’t tell me people don’t want to spend money right now. They just don’t see the value in what you offer. Maybe it’s because you don’t see the value in what you offer, and it’s probably because of the price you charge. Bottom line is people with money pay for value. They’re less worried about the dollar figure and more worried about the experience and the value they get. So if you can’t charge what you need to charge to stay profitable, fix your fucking process. Make it more valuable and get out there, and make sure you earn your ability to stay in business. That’s your job. You’re the captain of the ship. So embrace your worth, understand your value, and take confident steps towards a prosperous and fulfilling entrepreneurial journey. Let your pricing reflect the value you bring and watch your business thrive.
