When a wedding business owner comes to me with a pricing challenge, it’s usually brought upon by the fact that they aren’t making the money they’d like to earn from their business. The thought is this: “I’m not earning enough money in my business, my pricing must be too low.” This might be true. But, pricing is a marketing decision FIRST, and then a financial decision.
When we look at pricing, we need to make sure that it’s a fit for a business’s market placement. Ask yourself the following questions to gauge whether your pricing is appropriate:
- Is it a fit for your market? What is happening in the wedding industry where you live/work?
- What do you do differently from the competition? What is your competitive advantage?
- What is your work experience? (prior to starting your business)
- What has your experience been in your field? (after starting your business)
- What sort of reputation do you have?
- What does your branding say about your ‘perceived value’?
- How much demand is there for what you do? Are you maxing out your sales?
The more uniqueness you can offer, the greater your perceived value will be. The greater your perceived value, the more you can charge your clients.
Once you’ve covered the marketing fundamentals of pricing, THEN you can begin to test it financially. This is where we place your ‘ideal market price’ into a test against your financial goals and see if they are attainable. If you’re not reaching your financial goals, we’ll revisit your sales plan and your expense budget. If the model isn’t sustainable with your pricing (and all other factors are OK) then we’ll have to make some changes to your marketing strategy.
All of the pieces are so closely interrelated. They have to work in perfect synchronicity for the business to be viable.
Need help with pricing? Shoot me an email at firstname.lastname@example.org and tell me what your challenges are.