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What the Client Really Means When he Says that Your Price is Very High

If you have owned your business for more than 5 minutes, you have probably had a large number of consumers proclaim, “Your price is too high.” Although it is simple to regard such clients as price shoppers, I advise you take a new look at the circumstances. The customer is actually complaining less concerning your price and more concerning the value that he thinks that he will obtain..

I recently saw a formula that makes this point visually:

Value = Perceived Benefits / Price

If your company and the job you are proposing to a customer appears like to other companies, the perceived benefits are equivalent. The value that the customer receives therefore, will be figured by the price. It is only ordinary to go with the lower cost if the value is equivalent.

On the other hand, if your company or the job you are proposing provides superior perceived benefits then you might have a higher price and nevertheless supply more value. That is, as the perceived benefits rise the price you charge can also rise, and the customer will at the same time receive greater value.

There are many ways to do this, and most entail slight expense. And, the expenses that are incurred will be part of the price you give to the customer. Among the benefits you might offer that usually increase your company's value are:

Take credit cards
Create an informative web site
Provide the customer an information package regarding your business
Provide an exterior upkeep program
Give the client a reference list
Get certified on deck restoration, ventilation, etc.

The cost of such benefits is probably less than $1 per man hour (depending on the number of employees you employ in the field). Yet, by providing such benefits you might raise your price $5, $8, $10 an hour or more. That is, the return on investment is substantial.

Granted, certain clients won’t care about many of these benefits. And this is why it is so critical to provide as large a number of benefits as you plausibly can. The more you present, the more likely that a number of them will interest a individual customer. That is, the greater the number of benefits you provide the higher your rates can be. (Of course, there is a threshold to this.)

Consequently, the next occasion a customer says, “Your price is too high,” remember that he is truly declaring, “I don’t notice the value.” If you desire to command a higher price, you should provide more value, and that means more benefits.

Article Source: http://www.ezinearticles.mk

Learn how to overcome price objections when selling home improvement projects.

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