How often do you check, review and look over your services, clients and current pricing structure in your business? How do you know if you are still competitively priced or running on par with service offerings compared to your competitors?
It’s time to take stock of your business and answer some quick fire questions about your services, clients and pricing… ready?
The first question I want to ask you is: what was your first core service or product that was successful in your business? (i.e. made money) The reason that this question is the most important, is that it was because of this service or product that you even have a business in the first place. Now thinking about your core product and your original business, ask yourself the following:
- How many services do you have?
- Do you have too many, is it confusing?
- Do you not have enough? Do you offer what your main competitor does?
- Do you specialise in anything?
- Do you advertise on your speciality on your website, flyers and social media?
- Are all your products and services TRUE to your core business and original business?
“Why would I evaluate my clients? I am happy I even have clients, in this current climate”
I hear you and I understand your point. Your clients are the life blood of your business and they pay your bills, but still, it can’t hurt you to ask a few questions now could it…
- Who are your best performing (spending) clients?
- Who are your worst spend clients?
- Which clients pay on time?
- Which clients are you always chasing for payment?
- How do you invoice and collect money from your clients?
- How do you keep in touch with your clients?
If you start to notice that you have several clients that are low spend and high maintenance, on your books, you really need to asses weather they are worth keeping – not all business is good business. Help to prevent yourself becoming a busy fool, stop running around after business and contracts that you get very little reward from. Think about it – that time you are running about for pennies, could be spent finding new, higher value clients and time spent marketing your services to a more suitable demographic.
In order to have a sound pricing structure you must first have a strong grasp on your accounts and finances within your business. You need to know if your business is making money, if it is breaking even or is it is running at a loss. Depending on the current state of your finances, you may tailor your pricing structures or pricing reviews differently. As a rule of thumb, charge rates should always be reviewed annually due to changes in tax allowances, national minimum wage payments, the cost of cleaning products, insurance, fuel etc.
- Do you cover all costs in your charge rate?
- Do you know what your profit is per hour? Per cleaner?
- Do you know your break even points? For the business? When taking on a new cleaner?
- Do you have an understanding of your cash flow management?
- Do you have a pricing review policy?
Take a look at the video below for a re-cap on reviewing your services, clients and pricing structures.
Do you have any checklists or questions that you ask yourself, to keep you and your business on track? I would love to hear your comments or feedback below.
Thanks for stopping by,