04 Apr Play to Win the Pricing Game
The biggest challenge preventing many managed service providers from growing is pricing. If you don’t charge enough, you’ll struggle to make a profit on the services you deliver. You’ll also undermine the perceived value of your offerings.
Most decision makers know they get what they pay for, and you should reinforce that notion. If your intention is to position your services as being better than the competition, offering steep discounts to win new business is going to have the opposite effect.
Get out of the hourly pricing rut
When providing a quote for your services, you may be tempted to charge an hourly rate with little consideration given to a value-based pricing strategy. However, this approach leaves money on the table.
Put a dollar value to reliability
If you’re doing a great job as a managed service provider, there is a high likelihood your clients will take for granted their computers and networks are operating smoothly with little downtime, performance issues or security breaches. Unless you proactively communicate all the things you do to keep them up and running, hassle-free, your clients may question the value of your services, making it even harder to ask for more money as the cost of service delivery increases.
Let go of clients you’ve outgrown
Some price-conscious clients are simply looking for a bargain and won’t be able to see anything past your price tag. It’s up to you to do a cost analysis to be sure you are actually making money with every client. If not, use your documentation to show them your value and adjust your pricing model to reflect your worth. If they are unwilling to make that adjustment, then it’s time to let them go.
Don’t budge on budget
Offering discounts and underselling your services leads to dissatisfaction among your clients and stifles your ability to deliver your best work. Not to mention making you feel resentful and like a bargain bin service provider.
Let Network Detective Pro help
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