How to Master Preferred Pricing for Your Customer Base and Win More Deals
You've put a lot of time, money, and energy into procuring the goods that you sell. Now comes the task of setting an appropriate price for those products. Having an effective pricing strategy helps solidify your position by building trust with your customers, as well as meeting your business goals.
Many factors go into your pricing strategy, and it's usually not a one-size-fits-all model.
So how do you manage preferred pricing for your customer base and win more deals?
|It is vital to have a tool that will help you get all of the information that you need for pricing decisions into one place. An ERP like Windward System Five organizes your costing data and customers so that you can accomplish this easily.||
Many business owners skim over pricing, which may lead to either leaving too much money on the table, or pricing themselves out of the market.
Your pricing model should maximize your profit AND revenue... not necessarily make more work. Many companies focus on acquisition to grow their business, but we all know that selling more to existing customers actually reduces workload.
Your price needs to convince your customer to buy.
Price it too low, and your product seems cheap, which could mean a great value or just poorly constructed.
A price that's too high may portray its value, but if that is more than a potential customer is willing to pay, it won't matter.
There are many pricing models that businesses employ depending upon their financial goals.
The key is to make a decision based on COGS, consider your competitor’s rates, and tweak your selling price based on the market. It is often the case that one model doesn't apply to everyone.
Not every customer fits into the same bucket. It is for this reason that many businesses separate their customers into pricing or service level tiers. This way they can win the pricing game, and offer the service levels that each customer type requires.
|Some examples of price schedules include:
Automating your price schedules helps reduce pricing conversations in front of other customers
Windward System Five helps you manage price schedules and allows for exceptions to give you more flexibility. You can even employ different pricing models to various price schedules.
When should you use contract pricing?
Contract Pricing is useful for when you want to offer time-based pricing to your client, as either an incentive or a limitation to an offer.
Here are a few scenarios that might help you think about how you would utilize contract pricing in your business:
A Lighting Contractor is working on an apartment complex and wants a guaranteed price on a certain line of fixtures for the duration of their project.
Or a Landscaper working on a subdivision who is re-using a certain species of tree for the project.
Or a Wedding Planner looking for a contract price for the season from a liquor store or rental shop.
Read Also: Proper Promotion Planning Can Help Increase Your Revenue
Or you can start by checking out this webinar where we will set up and configuration of Contract Pricing. As always there will be a live demo with examples and a quick Q & A will follow.
If you are not yet a Windward client, one of our Business Developers would be happy to talk to you about your current business challenges and see how Windward System Five on Cloud can help.
Please reach out at +1 (800) 633-5750