It’s a tough market to raise your prices. Customers are extremely cost conscious and market savvy. Why should they pay more? Instead you need to reframe the problem into a yield optimization problem.
How to Increase Yields Not Prices
Posted by IanDSmith under SalesFrom http://www.portfoliopartnership.com 3899 days ago
Made Hot by: NolanGreen on August 3, 2013 5:48 am
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3890 days ago
3891 days ago
I understand that notion due to the fact that I have worked as a purchaser for a long time. When the sales people / marketing departments from the vendors came with a price increase due to raw material prices, inflation, currency changes, etc., I asked about substitutes, change of formula, different order quantities, safety stock with decreased delivery time, etc.
The deeper question I asked was about what could you do with the payment you get. I think we could see an increase interest in bartering and currencies backed by an objective standard.
Ian: I must comment on your statement: " Increasing sales prices is tempting because it goes straight to the bottom line." My saying is that decreasing the purchasing price is going straight to the bottom line. One saved $1 is more worth than a sales $1.
3890 days ago
3891 days ago
"I am open to discuss different terms of exchange of values, i.e., delivery of service and payment. As a supporter of objective money, i.e., precious metals, my standard price is 1 kg / ~35.27 oz of silver (Ag) according to the buy rates at GoldMoney for a 1/2 working day (circa 4 hours, effective time)."
I will add another terms of payment: X American Silver Eagle (1 troy ounce) $1 coins according to the spot price.
3891 days ago
In this case, what we're really talking about is making changes to a product or service without simply raising the price. The idea is that simply raising the price for the same product or service is always difficult, because customers feels they should be getting more value for more money. Instead, reinvent the product or service. Find a way to make it worth more in the customer's eyes. (Or find a way to create and sell it for less.)
3899 days ago
3899 days ago
Customers must see the value. It's that simple. Increasing the value is harder then simply raising the price, of course. But it's what your customers will respond to best.