It may seem counter-intuitive or outright ridiculous, but I have doubled my prices and fired half my clients. I have never been happier!
You see, the secret to a successful business, I have found, is to focus on the 16.67% — that’s right, the 16.67%. “What exactly is the 16.67%”, you may ask.
First of all, in nearly every business you can think of, roughly half (50%) of the prospects you speak with aren’t going to be interested in what you have to offer. Either they don’t believe they need the product or service you’re selling, or the timing isn’t right for them (maybe they just purchased from somebody else and they’re not ready to buy again). OK, that’s fair enough.
Of the remaining 50% — the ones who have an interest in what you’re selling — approximately two-thirds (66%) of them are going to feel your price is too high, or they’re not going to like you.
So that leaves one-third (33%) of half the people you spoke to — and we all know that one-third times one-half (33% x 50%) equals 16.67%. Those are the people that you should be focusing on — the ones who have an interest in what you’re selling, and are willing to pay your price.
All the others — the great majority of people out there — are simply not your ideal prospect. That’s not to say that they aren’t worth paying attention to; on the contrary, your task is to convert them to the 16.67%. But if they don’t exhibit real interest real quickly, you ought to move on.
How can you tell an interested and committed prospect from one who is not?
Thankfully, it isn’t difficult to do this; you just need to know what to look for!
In my experience with small business owners who want to grow their business, there are two (2) distinct things to watch out for:
- The first is the business owner who insists that you present to him or her, and doesn’t allow you to meet his or her business partner. I have never seen this type of situation work. Invariably, the first partner tries to communicate your offering to his or her partner and fails at it miserably — you won’t get the account.
- The second is the business owner who tells you how dissatisfied he or she is with the incumbent provider, then asks you for your price during your initial meeting — or worse yet, asks you to bring your pricing to the first meeting. Let’s face it, if the business was truly displeased with the incumbent, why would they focus on price when speaking to you? You are there to alleviate their problems, not to compete on price with a vendor who’s providing a poor service.
That is why today I sell my services for twice what I charged last year, and I don’t bring pricing with me to a first meeting.