When To Increase Your Prices …

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When Should You Increase Your Prices?

Business owners tend to overthink pricing - finger in the air, waiting for a sign it’s time to put prices up. In reality, the answer is sitting in your own numbers.

The number to watch: your conversion rate

Your conversion rate is simply the percentage of quotes or proposals you send out that turn into paying work. If you send 10 quotes and win 7, your conversion rate is 70%.

It sounds straightforward - and it is. But what most owners don't realise is that a high conversion rate isn't necessarily something to celebrate.

You want some people to say “no”

If virtually everyone you send a quote or proposal to is saying yes, your prices are likely too low.

If your ‘full pipeline’ comes with low margins and clients who expect a lot for a little, it's a slow drain.

Losing a job because your price was too high costs you nothing. Winning work at the wrong margin costs you time, resource, and energy.

A rough rule of thumb:

If 3/10 people AREN’T questioning your price, you’re probably too cheap. 😅

So:

• What’s your conversion rate?

• When did you last raise your prices?
  

Catch a short video with my thoughts here.