You're pretty proud of yourself! After all, only four months ago you came up with the idea of opening your own business - "Jenni's Interior Design" Your friends have always said you were gifted when it came to arranging furniture and picking out colors, and you love to do it, so you decided it was time to get serious.
You went to a few "Starting Your Own Business" seminars, picked out a name and registered it, had your nephew build a great website, printed up some business cards, got a second phone line, and took out an ad in the local paper - "Are Your Walls and Furniture as Stagnant as Pond Scum? You Don't Need to Break the Bank for a Fresh Look, You Just Need a Makeover!"
Then you crossed your fingers and waited. Day one, no calls. Day two, no calls. Day three - the phone rings! Success! Your heart is pounding as you pick up the phone. The conversation goes something like this:
"Hi! This is Jenni with Jenni's Interior Design, how can I help you?"
"Hi, my name is Celia, I saw your ad in the paper. What do you charge for your makeovers?"
"Well, my rate is $25 per half-hour for consultations or $100 per room to redesign the entire room. If we decide on new furniture or paint, that is your cost of course"
"Hmm, I have a lot of rooms I'm thinking about changing. Can you come over for a free consultation just to see what I have? If I do more than one room, can I get a discount?"
"Umm? sure, that's fine. If we do more than one room I can do a discount too, no problem"
Hold on. Maybe Jenni hasn't given away the farm yet, but she's on her way. When Jenni hangs up the phone she's going to realize a few things:
The problem here isn't that Jenni was caught off guard, the problem is that she instinctually began to doubt herself and her prices. You can't blame Jenni, after all, this is her first potential customer and while she's talking on the phone she's probably thinking "Gee, am I really worth $25 per half-hour? I do this for my friends for free. I don't know if I'm really qualified to charge that kind of money"
The potentially bigger problem is Jenni pretty much threw her pricing structure out the window when questioned. There is nothing wrong with bartering and making deals, but it shouldn't be your standard business practice. Without a doubt, if Celia likes Jenni's work and recommends her to a friend, Celia will be sure to brag about the great deal she negotiated as well. Now, Jenni is probably stuck with this "free consultation with a discount" policy for any referral customers. Jenni is setting herself up to run all over town free of charge, give good advice, and potentially not make a dime.
What Jenni should say is, "I would be thrilled to come out, but I'll have to keep the consultation charge in place. What I can do is credit your consultation towards the first room we makeover, each additional room would be at the regular rate. I'm sure I'll have some great ideas that we can work on together"
Of course it takes confidence in yourself to come back with that kind of a reply. Jenni is only going to have that kind of confidence in herself by knowing her competition, what they charge, and that fact that she is as good, or better, than they are.
So here's the key to not giving away the farm:
Know your competition and the commonly established rates for your service.
If you are competent, confident and know you have as much skill and talent as your competitors, there is no reason why you should be charging any less than they do. In fact, some people believe if you charge more it's a sign that you must really be good!
But let's not get carried away, the point isn't to see how much you can charge before you run yourself out of business. The point is, "Don't sell yourself short"
One great way to measure your competition is to call and try them out. I personally did this not long ago when I was thinking about opening a software consultation / training business. I found a small business specializing in software training and had them send out an employee for two hours of Microsoft Access training. The friendly lady who arrived spent two hours reading the 'help' screens (to herself) and flipping though the paperback user's manual trying to figure out how to show me some rather simple tasks I had questioned her about. Hardly what I would call expert training. However, it served its purpose - I knew I could do a better job.
Do your research and provide an efficient, professional service. Show them that you're worth every penny. If you build that kind of reputation, price will not be much of an issue. Your customers will admire your confidence and work ethic and be happy they're doing business with you.
Oh, and keep the deed to the farm in your drawer where it belongs.
About The Author
David James is the editor of "Home Income Digest", a publication updated quarterly which presents more than 40 of the best home-based businesses currently available in the country. Located at http://www.homeincomedigest.com, Home Income Digest includes only well-researched, established, small business opportunities. For more information about the author, visit http://www.homeincomedigest.com
http://www.homeincomedigest.com
Chicago limo Skokie ..Doesn't it frustrate you when you've given good service, sometimes... Read More
Mr/Ms, 'not me' is often on holidays in your business.... Read More
Washing manufactured homes, mobile homes, can be a lucrative and... Read More
Are you a home or small business owner and you're... Read More
Deciding to start your own franchise is just one of... Read More
If small business had no important outside audiences, it wouldn't... Read More
Business card size works well for invitations to special events.What... Read More
There are countless ways to save your business money. Unfortunately,... Read More
Do you like animals? Would you like to work for... Read More
Everyday, customers and business owners are bombarded with billboards, logos,... Read More
Most business owners do not think of selling their companies... Read More
If you're serious about wanting to start a business, the... Read More
That's right ? are you making enough mistakes in your... Read More
We hear a lot of talk about junk mail nowadays.... Read More
Whether your target audience is in your neighborhood or across... Read More
In general, all of us know how to accomplish the... Read More
I've got good news and bad news. The good news... Read More
Most doctors never distinguish the difference between customers and patients.... Read More
Just as you are about to say "good-bye" to your... Read More
The challenges of the small business owner are well documented.... Read More
A thing worth doing is worth doing badly. Yes I... Read More
Whether you are an Entrepreneur or Business Professional there are... Read More
One of the most common horrific mistakes a business can... Read More
A janitorial cleaning service is one of the best businesses... Read More
Summer is a time for the outdoors, for that well-deserved... Read More
limo O'Hare Bonfield ..One of the biggest excuses franchisees of home based and... Read More
If you don't know what a Virtual Assistant (or VA)... Read More
Why does research and education play an important part of... Read More
A recent survey indicated that clean Taxi Cabs Fleets have... Read More
Q. I am a former pastor who left the ministry... Read More
People will always stress that having a well researched business... Read More
Are you a motivational speaker who consistently gets rave reviews... Read More
You've been meaning to tend to the administration part of... Read More
A thing worth doing is worth doing badly. Yes I... Read More
Writing a business plan is a fundamental step to ensuring... Read More
Where would a business be without a business plan? A... Read More
Owning a small business in Wichita, KS might not be... Read More
Why should you describe your business to others in 5... Read More
For the employees, payday is the brightest day; they finally... Read More
Anyone in business today realizes both the natural dependency on... Read More
Completion not Perfection Five Keys To Doubling Your Productivity and... Read More
Data. Most people think it is a term relegated to... Read More
Experts urge small business owners to "brand" their business ?... Read More
What would happen if you decided to take an extended... Read More
"What do you do?" It just might be one of... Read More
Financial Consultants are one of the fastest growing industries today.... Read More
Ongoing support for a franchise system is omnipotent. A major... Read More
Approximately 200,000 new businesses are started each year. More people... Read More
In today's economic climate, the first priority for the small... Read More
Many physical therapists in private practice have the appearance of... Read More
Small Business |