It doesn’t matter what your coach or your colleagues or people on a Facebook group says you should charge. What matters are the signs that are actually showing up in your business. I want to talk about the 4 signs that you are actually undercharging.
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Sign #1 – Are Bills Stacking Up?
The first sign to look for is whether or not you can pay your bills.
Specifically what I mean here is if your business is doing pretty well – so you’re making sales, you’ve got clients or customers coming in – but you still can’t make ends meet.
Now, this can obviously come down to a lot of things, right? We could just be mismanaging our money, we could be struggling in some other areas, but this is something to look for. If you’ve gotten good traction and a handle on your budget, but you’re just not bringing in enough this is a sign that you actually need to increase your pricing because maybe you haven’t taken into account business expenses and personal expenses when you set those prices.
We talked about how to set your prices and using some really smart strategies in last month’s money mindset video, so if you haven’t read that one, I would highly encourage you to check it out after this one to help you figure out how to change your pricing.
Sign #2 – Has Demand Exploded?
Number two sign you’re undercharging is when you’re so busy you can’t keep up with business.
This usually happens when you’re pricing has started off exactly where it needs to be. You price yourself really well and you’re really gaining traction. You’ve got a lot coming in, but you just don’t have the time and energy to be able to provide the services or the products that people are asking for.
We just get to remember that sometimes we get to a stage in our business where it’s time to increase those prices and when the demand has gotten bigger than your supply enables you to supply, then that’s when you want to start increasing prices.
Sign #3 – Is Biz Slower Than It Should Be?
Now, the third one is really tricky because it’s actually when business is slow and what I mean by this is if you’ve got a great audience, you’re getting visibility, you’re getting traction, but you’re just not making sales.
I want to explain though what I mean by this and why this is actually a sign that you’re undercharging.
This is where I started out years ago as a coach. When I first started, I started with very low pricing because I was brand new. I needed to gain experience, gain testimonials before I could really earn a higher price, right?
Now, most people when they’re in this situation, they will actually think that they need to lower their pricing, but I did something super scary and I decided to almost double it.
When I did this, do you know what happened? I didn’t get slower. My business actually doubled too, and I didn’t just do this once, I didn’t just do this twice, this happened three times and my business. Each time I doubled or almost doubled my rates, my business exploded with it.
The reason this happens is because the human mind often equates value with price, and so as my experience was gaining momentum, when people are actually looking at what I was charging, it was devaluing what I could do or provide to them because they were seeing this really cheap rate that didn’t make sense to them.
Even if they were interested, they would come to that page and they would see that pricing and they would be like, “What’s missing here?” And they would bounce.
Now think about this for yourself, what if you found a Craigslist ad for a Lamborghini that was $700, would you think that that was a great value? Or would you assume that it’s probably a hunk of junk?
The same might be going through the minds of your clients or your customers.
If something’s too cheap, they’re going to probably assume that it’s not actually what they’re looking for.
Sign #4 – What are people actually saying?
The fourth sign that you’re undercharging is that people are actually telling you so.
By people, I mean the most important people, I mean your clients and your customers.
But they’re not going to literally tell you, “I want to give you more money.” Or, “You should charge me more.” What they’re going to say is:
- “Oh wow, you’re so much cheaper than I expected.“
- “Oh, I expected it to be a lot more. This is great.“
- “Oh, you’re the best price out there.”
That’s not a compliment. You don’t want to be the $700 Lamborghini on Craigslist.
You want to be the thing that people see as a good value, but they don’t see as cheap. I can’t tell you the number of business owners I’ve personally said that to who could not believe it. It is the most obvious sign you’re undercharging, but they will insist that that’s not what that means.
Listen, if your clients and customers are literally telling you that they would have paid more, listen to them because they are the ones that pay your bills.
Again, the goal here is to bring a lot of value without being cheap.
Are you ready to overcome the limiting beliefs and the bad habits holding you back?
Be sure to grab my free Bottlenecks to Breakthroughs training by clicking the below or you can learn more about it here.
What about you, Boss lady?
Do any of these signs of undercharging resonate with you?