There are many common hurdles entrepreneurs face when it comes to scaling. In my mind, there’s nothing more relatable than hockey legend Wayne Gretzky’s line, “Skate to where the puck will be, not where it is,” to fix scaling-relevant challenges. Early entrepreneurs get stuck in today’s itty-bitty details, completely overlooking the significance of tomorrow.
One of the many faults entrepreneurs can make on their journey to a successful business is not charging what they’re worth. Many make the mistake of developing a pricing model based on where their business is now and not making room for growth, planning where they want to be.
When this happens, they find themselves in a dire situation with pricing, causing them to feel trapped and treading water for a simple reason. Their business is not scaling properly because they failed to price correctly in the beginning.
Let’s talk about getting started with your pricing models and how you can determine staying within your worth and not giving in to pressures which can make you feel like you should be lowering your value to your customers. Here are three strategies you can use to price what you’re really worth to your audience.
1. Don’t bend or break.
When an entrepreneur decides to take on clients or provide a product for their customers, the first part of this journey can often be the most difficult part of the process. It’s here where you struggle to find your value because you are up against clients who always want things at a cheaper rate.
When you can determine a rate that captures your worth, you will attract higher value clients who understand the nature of your expertise and experience. Entrepreneurs who are forced to take lower rates on projects or products usually end up missing the mark with deadlines or have trouble delivering what they’ve promised to the customer because they understand it’s not where they would like the price point to be.
Knowing this, don’t bend or break when it comes to negotiating a price you feel is worth charging your clients. When you do this, you will begin to see both you and your clients will value your time better.
2 Having EPD — Entrepreneur Personality Disorder.
This is a self-diagnosis almost every entrepreneur can say they have. It’s the common problem of wearing too many hats within your business. During the initial growth phase of your business, there are always multiple responsibilities which take your attention away from certain things you should be focusing on when it comes to pricing your worth.
Getting too busy and throwing yourself in the mix can hinder your growth spurt. Most entrepreneurs either don’t bill for the time spent on a project or, if they do, they will short change themselves and only bill for one component of the task.
This can hinder your business growth and prevent your company from taking the next step in the evolution of entrepreneurship because, without it, you have no stable foundation from which to build on.
The Founding Partner of Incipient, Bryan Weinert, says this about EPD: “In the first year of our business, I managed a lot of the smaller development projects and only priced out proposals for the engineers and designers on the project. The issue with this is that I am now an unpaid employee and can’t scale my business until I delegate that role. It is critical that you price for where you want to be and not where you are.”
The lesson — price for the team you want to have and all the members you represent so that you can hire them on future projects.
3. Increase value with experience.
The reason influencers alike can charge what they want to for their coaching, mentoring or any other service they have, is because they have a proven track record within their industry. People know, like and trust their brand and have seen them grow over time.
If you want to create a pricing strategy which shows your value, one of the best ways to do this is to increase your value in the customer’s eyes through experience. It’s always critical to revisit your value propositions and the new assets you have which consistently brings clients in based on your past experiences.
This can work on a personal and a team building level. First, increase your experience level by branching out and trying new strategies within your business which can help your target audience. Do something that no one else will do, either because they don’t understand it, or it may be too risky for their business. Give these a shot, because it will help you consistently learn things about your audience, your goals and your company. Learning is the key to experience, so take advantage of it.
Secondly, be sure to connect with your team members to extract ideas about how your company can use past and present experiences to bring more clients to your doorstep. With each team member striving to impact your audience on a personal, and experienced, level, your team will thrive in this environment.
Growing your company can be an up and down roller coaster and a very drastic dynamic for you to follow. This often leads to many entrepreneurs getting caught up in the rat race.
It is important that hustle is a component but not the end all, be all. Reflection is one of the most important skills an entrepreneur can master as it lets you constantly see the big picture and how your hustle is a component of that. But the sense of direction is what will result in constant growth.
When you consistently use these three strategies for business growth, you will be able to accurately build a pricing model which will display your worth to your audience and allow you to grow more freely.