What is your worth? This can be a very challenging question for any entrepreneur, but I think it is especially hard for a female entrepreneur. As women, we are taught that we must be modest and humble, and this can impede how we price our services. Determining price is one of the most important tasks for your business. You do not want to overprice yourself too much compared to your competition and make yourself unattainable to the client. But, you also do not want to underprice yourself and upset your competition and devalue your services. It is a challenge, but I think as female entrepreneurs we are more likely to fall into the wiener dog effect, and sell ourselves short. So, how do you avoid this? Follow the below key points to help price yourself appropriately.
1. Know Your Competition
You should know the strengths and weaknesses of your competition and within this you should know their pricing. How does their reputation and success reflect their pricing structure? Understand who prices themselves at the lower range of the market and who is at the top. Compare this to their strengths and weaknesses. How do they promote themselves and what is their messaging around their marketing?
2. Know Your Break Even
Your break even point is when the cost to sell a product or service matches the cost you are selling it for. As a business owner, it is incredibly important that you know your break even point for each service or product to determine your profit. Entrepreneur.com has a great explanation on how to determine your break even point here. Knowing this helps to ensure you are earning a profit for a particular product or service, but also helps to accurately track your overall profitability for your business.
3. Know Your Worth
You also need to know your own strengths and weaknesses; both as the leader of your organization and for your overall business. Your strengths and what sets your business apart helps to determine your worth. You must think of these strengths when determining your pricing, but it is also important that you promote them as well. For example, for myself when I first started it was difficult to determine what to charge for private training services as there was such a range within the market. I knew my strengths were my experience as I had over four years working in the shelter environment and multiple pet related jobs within that time as well. I had apprenticed with a great organization and could use this experience to promote myself and what I would offer. This became my selling feature to help set myself apart from the competition, but also to determine my fees.
4. Know When to Increase
Increase your pricing as your reputation, experience and credentials increase. I take education seriously and worked towards gaining certifications in my industry to demonstrate my knowledge and skills. Dog training is unregulated and anyone can say they are a trainer or can obtain certification for only attending a short program with limited handling of dogs. I took every opportunity to learn by reading books, attending seminars and conferences, taking online courses and obtaining certifications through the most recognized organization in the industry. This allowed me to begin to price myself above the competition and also set the standard for the industry. I am proud to see how seriously dog trainers now take their education locally, and in turn, we have educated the dog-owning public on what they should be looking for in a trainer. This helped to set dogma as the leader, which in turn allowed me to price our services at the top end of the scale.
4. Ask Your Clients
Do not be afraid to ask your clients what they consider fair pricing. Their answers may surprise you. If you are considering offering a new service or fee structure, create a survey for your existing and potential customers. Ask them what they consider to be some important factors when determining to purchase that particular service or product and what they would pay for it.
5. Do Not Become the Wiener Dog
By going through the above information, you should have a good understanding of your worth. However, even when we know that, we may still undersell our services in an attempt to bring in more clients. This can be detrimental to your reputation in two ways. First off, customers do compare low pricing as equating to low quality. If you want to be known for offering a high quality product or service, keep your pricing higher. Secondly, you risk upsetting your competition. I believe that we need to support and encourage each other, even if we work within the same industry. If you go out and undercut everyone else, you do risk alienating yourself from your competitors. Everyone has more to gain when we support and work together. Keep your pricing fair and be aware of what the market trend is for it.
Do you have some other suggestions for how to avoid the Wiener Dog Effect? Or do you have some stories to share of your experiences with this? Comment below or email me at email@example.com!