Make the customer’s life easier. Tell them the price!

Lincoln on U.S. one centPrice gets in the way of doing business. For those who have sold for a living, you could probably each write a book about getting around the price issue. Yet for most businesses this is a self-inflicted wound.

Today, the worst example of this is booking an airline trip. Try it. Try to get a complete final price for a trip. Unless you know exactly how many bags and their individual weight, it is impossible to get the final price.

In the on-line world, a recent change by on-line retailers is to provide free shipping as a standard offering. This is happening based on evidence that purchase rates increase for items with free shipping.  Evidence also exists that these customers tend to comparison shop less where free shipping is offered. I believe this is simply a case of making it easy for the customer to buy.

One key market that is just beginning to change pricing practices is the services area.  A good example of this change is in the practice of law.  Most people know that lawyers typically charge by the hour.  Many of us start off our discussion with a lawyer trying to figure out what the work we need done will cost us.  This is especially true if the client-lawyer relationship is new.

Recently, several firms in town have started providing some services at a fixed price.  In the area I work, mentoring start-up companies, this is a real change for the good.  When your cash balance is precious and there is little or no revenue coming in, it is hard to engage in an open-ended-fee relationship.  A good example of this change is Start-up Launchpad by Davis Brown Law.  For a set fee, the client receives a set of services that are typically needed by a new start-up company.  Even better, potential clients can sign up for access to the site for free and access valuable information without cost.

So think about the average start-up business person facing the long list of tasks to start a business.  Getting all of the legal work done is only one item on that long list.  Which do you think the entrepreneur will choose, the hourly rate with the unknown total cost, or the flat fee bundle of services?  The customer choice just became so much easier.

By providing a clear price for a product or service, you are taking away a roadblock to business.  Look at your business and find new ways to make the buying decision easier for your customer.  They will thank you.

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