Charles Lau dot Com

Scott mentioned something very interesting in his blog about “When should you raise your fee“? This triggers me to write a post about it because I have something more to talk about it.

Entrepreneur-wannabes
There are many people out there who wanna be a boss of their own company. These people might not be coming in from sales background. They have been in the position of a consumer for so long, who always bargain for a good price when they buy something. And when they finally became boss, the very first problem every boss might face is how to price their products and services.

It is especially hard when the service comes from their own hard work (self-employed). For example:

1. How much should you charge for transporting a few cartons of goods from one place to another?
2. How much should you mark up for a product - that you have bought - to sell to a buyer?
3. How much percent in commission should you charge for helping your client to sell her house?

Or let’s turn the table around and say some other related topics:

1. How much should I give my referring agent for giving me so much business?
2. How much should I give my salesman for rewarding his hard work?
3. How much should I give my friend for giving me such a huge busines referral?
4. How much revenue share should my partner and I get for doing this business together?
5. How much should I spend to give a gift to my customers?

One sale, different position. You want to be in the boss’ position? Or the consumer’s position?
There are many reasons why we are charging higher (mentioned in Scott’s blog, have a look at it.). However, the very problem that these bosses are facing is the idea of being a real boss, and not consumer.

Let’s think about it. When you were in the position of a consumer, you always think of having as much discount as you can. Do you really think of how much that boss is really making? No…

Hence, when you become your own boss, you start to see another picture here. You are now a boss and you are seeing a “mirror” of yourself trying to ask for discount. How do you tackle with that? Did you remember how that boss previously tackled you when you were asking for a discount? Boss don’t really talk about how much they are earning. In fact, they don’t focus on that topic at all (That is the very last choice which will never be used.)

Sales is Your Life Line!
What many boss-wannabes never realize is that they have to learn sales as it is the BLOOD of the business… Without the flow of the blood, the whole business body is very numb and unmovable. The one who brings in the cash is “king” in a way because he is bringing in the “blood” to make the business move…

Do learn more about sales in the many books out there. A good start will be books from Brian Tracy… Best recommended by me… Check my affiliated link here for all of Brian Tracy’s books. Brian Tracy is one of the best authors-cum-speakers that I know of who expresses his lessons in a step by step basis. In fact, I can’t believe that he managed to break down those self-improvement lessons into very simple steps to learn from.

Sales is all about sharing
In fact, we are all sharing all the good stuff out there to everybody, and anybody. As a consumer, it could be feeling weird to do such a thing since we only know how to grab the best stuff and only share with our close friends… Don’t be selfish, start telling everybody about the best things you have!

Whether you are sharing the good stuff with them for a commission or not, the people who learn the good news from you will be happy to grab the deal from you! They are getting the best stuff, or the best price for those stuff that they have gotten! Why are you so selfish not to let them know? Earning a commission is the rightful thing to do as it is your salary for survival… You are not cheating anybody of their money, are you?

So How Much Should We Charge?
It all depends on a few factors here:

1. How much do you wish to make?
2. If you charge low, make sure you have a good number of customers…
3. If you charge high, do make sure they are paying for their worth. People are paying to match the product value.
4. And if you do really charge high, try to have a balance of the number of people buying from you, to break the even point.
5. If you are just matching with the market value, you are probably in the safety margin, but are you happy with the number of customers buying from you?

Just make sure that the number below goes well in your gross income…

Your Price X Number of buyers X Average number of times each buyer come back = Your Gross Income

Let’s say in a month, you are making this much:
$100 x 20 buyer x 1 time = $2000

Is this what you wish to get in a month? (Let’s just focus the topic on the price here and not on other factors.) You will have to determine your price to measure how much you wish to make in a month at least…