The Female Fusion Podcast!
The Female Fusion podcast is your go-to resource for inspiration, motivation, and practical advice for female entrepreneurs.
Hosted by Jen Blandos, a seasoned entrepreneur with over 20 years of experience building successful businesses, this podcast features insights and expertise from some of the world's top female entrepreneurs and industry experts.
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1. How to price your product or service as an Entrepreneur
2. Strategies for setting up a business pricing model
3. Investing in Loss Leader pricing to attract customers
- How to price your product or service as an Entrepreneur
- Strategies for setting up a business pricing model
- Investing in Loss Leader pricing to attract customers
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[INTRO] Hi there. I'm Jen Blandos, the founder of Female Fusion Network. I've been an entrepreneur for over 20 years with experience in building seven figure businesses and working around the world. Originally, I'm from Canada, but I've been living in Dubai for the past 14 years. I've created this podcast to share my insights and expertise as a global entrepreneur and help other women start, build, grow, and scale their businesses. You'll also hear from some of the world's top experts and female entrepreneurs who will inspire and motivate you to achieve your business goals. So join me as we explore all that the world has to offer and build the business of your dreams. Let's get started.
Hello. So today we are going to be talking about the wonderful topic of pricing. And some people might find that this feels very overwhelming for them to talk about money. But actually pricing is such an important aspect of being an entrepreneur and it's really important that we get this right. And I often get asked by business owners, how do I know that I'm charging the right price?
[00:01:35] And I often see other business owners asking other business owners what they charge for something. And it can be really difficult, especially if you haven't had a business before, to know what is going to be the right price for you to charge in your business. So the first thing that I would say before you decide what price you're going to charge is that you really want to be thinking about how much it's costing you to deliver your product or your service. Now, depending upon what kind of business you have, your costs are going to be quite different. So every business is going to be unique and this is where you need to be able to do the research yourself.
[00:02:26] So when you are looking at how much it costs to deliver your product or service, there's so many things that you could be looking at. For example, if you have a product, it is the cost of producing your product. You also need to take into consideration the shipping, the duty, the customs staff costs and other overheads that you might have so that can all add up and that can be quite pricey. But then if you have a service based business, so maybe you are a consultant, that the amount that it costs for you to deliver that service is very different because often it's just your time, it's the time that you are taking to deliver that service. Maybe as well you need to have a bit of technology and so you might be using specific technology as part of that as well.
[00:03:18] But when we are pricing our product or service, we want to be really clear on what our objectives are of doing that. So are we thinking that we want to be able to make a profit or do we want to be able to make sure that we have a position in the market so we can gain market share, or do we want to be the same or cheaper as our competitor? Every business has a certain objective for why they want to charge a certain price. But you want to ensure that you make money. And this is something that I say to all business owners, don't go and price your product, so you're going to be making a loss.
[00:04:09] And this is where we need to know our numbers. And if you're like me, I failed maths when I was in school. I hated numbers and in my business as well, for years, I ignored the numbers and had other people do it. But math and numbers in our business is different than the boring math that we had to do when we were in school. So the math that we had to do when we were in school was very much focused around things like calculus and trigonomedometry and complicated formulas, where the maths that we're doing when we own our business is a lot simpler.
[00:04:51] And at the end of the day, we want to be able to make money. That's just basically where it comes from. Now, I love podcasts. I love to listen to lots of podcasts. And I find it interesting when I hear other entrepreneurs talk about pricing and what is a good price.
[00:05:12] And a lot of experts that I've heard speak about this will say that you should be manifesting money standing in your power and charge lots of money to make what you're worth. But then oftentimes what I see, what happens is that entrepreneurs aren't making what they want to. So the first thing before you decide all of that, you need to be able to do some research and you need to be able to understand who it is that you are selling to and what they're prepared to pay and what they value. So if you haven't done any research in your business and this is one of the key areas when you are setting up a business, or if you skip this and you've gone straight to setting up your business, that you want to be clear on who your ideal paying customer client is, what it is that they want to buy from you, and how much they're prepared to pay. So when we're thinking about our pricing, there's so many different models that you can look at.
[00:06:22] And I'm going to talk you through a few that are kind of popular with business owners, with small business owners. But it's important as well that you do your own research and decide what is going to work best for your business because every single business will have a way of working that's different from potentially another one. So when you're looking at your pricing, one of the first ways that a number of businesses operate is they base their pricing strategy on something called cost based. So what that means is that you look at all of your costs. So that say for example, the cost for you to create your product or deliver your service costs $100.
[00:07:11] So what you want to think about is how much profit do you want to make on top of that. And what you do is you add a margin or a markup to the cost of producing and distributing that product or the service. So let's say for example, my cost is $100 and I decide that I want to make $100 profit on that, that I would bill my customer or my client $200. Now that's great, but then we also have to know that that pricing is realistic. And I'll talk about that in a little bit more detail, but having your cost plus pricing is one really great way for you to be very clear on how you're going to be charging your customer, your client and coming up with that price.
[00:08:02] But then also if you're a service based business, service based businesses can also calculate their pricing based on hours. So they might say they would be $100 an hour or $50 an hour, $200 an hour depending upon what it is that they are providing. And what they would do is they would calculate that based on the average of what the cost would be and multiply that by hours. And typically a day for a consultant is between six to 7 hours as well. And then they ensure that all the fees and the cost that they would pay for that person to deliver the service is calculated as part of that.
[00:08:44] Another area that you can look at is your competition and that is what is your competition charging. And you go and you price your products or your services close to what the market leader is charging for those, but maybe just a little bit less. And so if people are trying to choose between option A or option B and maybe option B is a little bit cheaper, maybe they would try going with option B to see if it's as good as the main competition. So when you are first starting out in business, this is a way that a number of entrepreneurs go because it gives them the opportunity to get in and to get close to that market leader and have other people try their product or their service. But again, this comes down to research and this is why we can't just stick our finger in our mouth and stick it up in the air and see what direction the wind is going.
[00:09:42] It needs to be based on actual research as well for us to be able to decide what people are willing to pay. And there's another strategy around pricing called value based pricing and that's basically what customers think a product or service is worth rather than the actual cost. And again, this is where the research really helps, right? Because if you have talked to your potential customers or your current customers that you are able to test the pricing and test the product of the service with them to see if they would be willing to pay for that. So businesses that can do this type of pricing are typically ones that have a service or product that saves people time or money or it would have a premium look to it, a premium look and feel.
[00:10:41] So it might be luxurious, prestigious or exclusive and then people would be willing to pay for that as well. But when you are priced higher that there's also the expectation of quality, high performance, excellent customer service. And so you need to make sure that all of those add up as part of that as well. When I first got into entrepreneurship, one of my first businesses was a training business. And I went into it thinking, okay, this is my first business.
[00:11:14] How am I going to get customers? Okay, I'm going to get customers by being the cheapest person on the market, so everybody is going to want to go with me. So I had brilliant training, really, really good, high quality training. And I thought that the best way to get hundreds of new clients was going to be the cheapest one on the market. But what I found is that nobody wanted to buy from me and I couldn't quite understand that and I was feeling really frustrated.
[00:11:46] I created all of these courses, had a really great way of delivering, had case studies and a track record of delivering it successfully for other businesses. But I wasn't having customers buying from me and I couldn't understand it. So then I did a little experiment and what I did is I probably forexed the price of my training courses and I felt this huge anxiety around that, right? Just the nervousness of thinking, oh my goodness, I've just forexed my price of people going to pay for it. And what I found was within a period of about six weeks, I went from having very, very few customers, people not paying attention to me, to a number of customers who were willing to pay for that product, who were willing to pay for my service, which was my training.
[00:12:45] And that was really eye opening for me. I had never thought about that before because I had no entrepreneurship experience in the beginning and I thought, if I go in cheap, I'm going to be able to deliver lots. But what my customers were looking for, because what I was doing was quite niche, because it was training around communications and PR that my customers valued quality and price didn't matter to them. I mean, price matters to everybody at the end, but they weren't so price sensitive compared to other customers. So for example, I always say to our entrepreneurs and Female Fusion Network, if your clientele, if your ideal paying customers are entrepreneurs, is that the right customer to have?
[00:13:41] Because at the end of the day, entrepreneurs don't pay well. Everybody's struggling and trying to build their business, and entrepreneurs don't have a lot of money where if you are delivering work for a corporate client, a corporate client is willing to pay two, three, four times the price for a similar product or a similar service, depending upon what it is, especially when it comes to the services industry. So this is where you want to think about that and about who your customers are as well. Now, when we are looking when it is a product based business, it can get a little bit more complicated. And I know that our businesses that are product based businesses sometimes struggle on how they are going to price their product.
[00:14:34] So, for example, you can look at doing something like what's called penetration pricing. And that's where you set a really low price in the beginning to get sales or to get market share brand recognition. And then once you start to achieve that, once people start to know who you are, that then you can slowly, slowly increase your price to normal levels. Sometimes that works, sometimes it doesn't work. It depends upon who you are and what your business is because also customers can be quite fickle.
[00:15:05] And if you are in an industry where there is a lot of competition and a lot of choice, that people might just be going with you on the sheer value of your pricing. And the moment that you increase your price, they're going to jump over to the next product based company who has a cheaper price because it's purely going to be motivated by price. And this is why research is so key and we really need to know who our customers are to be able to do that. The other thing as well that some businesses do, and this is more of the luxury or the really unique products or sometimes even service based businesses, is that there's a really high initial price which is aimed to create desire. So people really, really want to have it, but they can't have it or they can't afford it because it's so expensive.
[00:16:01] And then once the profits are made, then the price is lowered to a wider market so more people can afford it. So, for example, one thing that I have been coveting for years, and I was just thinking about this today, is I love Apple. Everything. The Female Fusion Network office is filled with Macs and we have Mac, Mac, Apple, everything. I like Apple because it's pretty.
[00:16:28] And one of the things that I've been coveting for about the past five years is I've really wanted to have a monitor in the office that I can connect my laptop to. As I get older, my eyesight is starting to go a little bit and I like to be able to look at everything that I'm working on on a big screen. Now, apple used to make monitors. They used to have displays that you could have to go with your laptops, but they stopped making them and they outsource them to another company. And I never liked them because I thought the design was ugly.
[00:17:02] And I like the very nice slim line design of that. Now I had had a monitor that I got probably well over ten years ago, and I'm still using it just because I like that it looks pretty, but actually the resolution on it isn't great because it's over ten years old. So Apple introduced these displays probably about five years ago, and they were so expensive. Like, we're talking 8-10 thousand dollars for a display. And I don't care how much money I have, I am not going to pay $8,000 for a display to sit in my office.
[00:17:45] There's other things I could be spending my money on. I like pretty, but not that much. So I've been coveting these displays and I just realized I was we're getting some new computers in the office and I was browsing the Apple store online and I noticed that they have displays that are reasonably priced for the rest of us mere mortals now, and they're now much more affordable for the office. So I'll be getting one of those. So what they've done is they went in with really, really high price, certain people coveted them, got them, looked really cool.
[00:18:23] And now for us mere humans and entrepreneurs that don't have big budgets, that they've now reduced the price to a wider market. So you'll probably start to see more of those displays. Again. The other area that you can look at doing for your pricing, especially if your product and even a service based business as well, is that you can do something called loss leader pricing. And what that is, is that's where you attract your customers by offering a product or service below cost.
[00:18:53] And you do that initially with the hopes that they're going to buy again from you at a higher price point. Now it can work and it can't work because remember, if those customers are cheap and they're only going to go for the cheapest business, who's going to give them the best deal? You are probably not going to have a long term relationship with them. So if you're looking at doing this kind of pricing, you want to make sure that you have the right customers that you'll be able to retain afterwards. Last leader pricing can sometimes work though.
[00:19:32] And the way it can work is I see it as a new business investment that sometimes we have to go and make a bit of an investment to be able to gain the recognition and the trust of customers or clients who want to do business with us. So let's take for example, a service based business. Let's say that you want to attract people to come and work with your business. Maybe you are a consultancy and there's a certain area or a certain industry that you really, really want to work with. And what you decide to do is you decide to put on a master class or a workshop for people within that specific industry.
[00:20:17] You make it completely free, maybe you even organize it at a nice hotel. Maybe it's going to go and cost you $5,000 to go and do that. But as a result of you doing that so maybe you lose $5,000, but you could potentially gain 100,200 $300,000 worth of business. And so this is where sometimes it pays to have your pricing. So you do make a loss or to be able to provide something for free or at a cheaper cost with the hopes that people will buy again at a higher price point.
[00:20:55] But there's one thing I want you to remember about this as well. And especially if you're new to business, you will see companies will try this out to try and get you to come down on the price. And this is the age old. If you do business with us, you're going to have so many doors opened up and you're going to have so many other people who are going to want to work with you. From our company, we have a group of companies, and we're going to tell all of them to work for you where we are the biggest and best company in this industry.
[00:21:32] And as soon as everybody hears that you've worked with us, you're going to get lots of business or we're going to refer all of these other customers to you if you give us this cheaper price. Unfortunately, that very rarely pans out. Sometimes it does. Sometimes you get referrals from other people that you've worked with, but oftentimes it is a technique that they use to get you to reduce your price. So this is where you will need to make a judgment call on if that is going to be worth it and if it's going to be the right decision for your business.
[00:22:10] So how do you find that right price? How do you know that you are on the right track? Well, the first thing you need to do is you need to do your research. You need to be really clear on your customer, your ideal paying customer. How much are they willing to pay and what would they be willing to pay for other products and services?
[00:22:35] And how often do you think they're going to buy from you? And are there any extra features or add ons they'd like, but maybe you're not offering? When you do this research, I find that it is so insightful to help you decide how you're going to price your product or service, maybe even as well any other things that you might offer. Also as well, it gives you insight into their language and how they describe things. So you're also able to really refine your marketing language and be really, really crystal clear on how you communicate that to really engage with your target audience.
[00:23:18] So when we are considering our pricing of our product or service, the research really helps us as well understand a bit more about things like demand level, whether there's high demand, low demand, whether the market is sensitive to pricing and how sensitive it is. Also as well what the competition is like, if there is lots of competition, if there's not much competition, if there's any changes that you can make to make your product or service so niche that people really want to buy it from you. But then also as well, you also need to take into consideration other things around the regulatory environment and where your business is operating. In some countries that you might have certain regulations that you need to follow, which would mean that you might need to get permits or you might need to pay other fees that you have to add to costs. And this is something that actually I'm having to go through right now.
[00:24:19] In the UAE, we put together a number of events that are face to face that are networking events for our members. And in the Pandemic, the government waived a number of service charges and fees around putting together meetups and events. And over the past couple of months, those have been reintroduced again. And the number of fees and permits that are involved in putting together some networking events and face to face meetups can be extremely expensive. Sometimes those permits end up costing more than actually what it costs to put on the event.
[00:25:04] So those are things that if we wouldn't have done that research and if we wouldn't have known that, we could have put on an event, come up with a pricing that would have made the pricing affordable, but also so we would end up making a profit. And then it would come down to us getting an invoice from the venue and seeing that actually the venue invoice cost more than actually what we ended up taking from our members to charge for that event. So this is where you need to be constantly aware of everything going on that might impact your business and might impact your pricing. Small businesses also get asked a lot about if they are going to provide a discount. And I know business owners can feel very uncomfortable around it.
[00:25:58] And this depends. When you're operating in an international environment, every market can be different. So for example, when I do work in Europe, pretty much anywhere in Europe, it is very, very rare that I will be asked for a discount. So I put out a proposal, send it to a client, the client reviews my proposal against maybe two or three other proposals. And either I win or I lose the proposal based on the quality of the proposal, what I'm offering, and most likely the price.
[00:26:34] Now, this is for a service based business. It's very unusual that a business in Europe would come back and negotiate. But when I'm operating in the GCC region, which would be the UAE, Saudi, Oman, Bahrain, Kuwait, all of those countries, it's very, very typical that I will be asked for a discount. And it takes a little bit of time knowing and understanding your industry and your customer about if they are going to ask you for a discount, because some small businesses get into trouble, that they will put together a proposal, they will put together a costing outline, and they will do their very best price. And then they will hear back from the client, and the client will say, okay, great.
[00:27:27] We really love your proposal, but we need a 25% discount. And this, when it first happens to you, can be really quite scary and quite upsetting. The first time it happened to me, gosh, it was about probably 20 years ago. My first, actually, it was a customer that I had in Saudi Arabia for a really big contract. And I was so over the moon.
[00:27:56] I remember when I won this contract was like, yes, first big contract. I felt like such a real entrepreneur at that point. So I had negotiated the contract and agreed all of the terms with the department that I was going to be working with. But little did I know that the way that it works in big companies is oftentimes you agree what it is that you're going to deliver for that department, and then you get referred to the procurement department or the finance department of the business, depending upon how big that business is or that organization is. And so I had the promise of a contract.
[00:28:40] We had agreed all of these terms. And then I get an email from the procurement team, and this person in procurement says to me, thanks very much for your proposal. We confirm that the contract has been awarded to your business. However, we have looked at the market and we have realized that your cost is 50% higher than anybody else, and therefore we're requesting a 50% discount. Now, my heart sunk into my feet when I got this email.
[00:29:14] I was devastated. And I was like, what am I going to do with this? That's not reasonable. 50% discount. And I was so upset.
[00:29:28] And I was quite young at this time. I think probably I wasn't even 30. It was my first year or two of owning a business. And I called my lovely new customer and I said to him, how is this possible? We agreed the price.
[00:29:46] We agreed all of the deliverables. And then I have somebody else contacting me saying that they want a 50% discount and everybody else on the market is 50% cheaper when I know that they're not. Now, this was my very first lesson in pricing and a little bit of negotiation and understanding procurement. So I got a phone call from him, and he said to me, he said, Jennifer, Jennifer, relax. I'm telling you, relax, don't worry about it.
[00:30:19] He said, don't you know how things go here? He said, this is a game. You have to see this as a game. He said, this guy from procurement is going to come to you and he's going to tell you he wants a 50% discount. You're going to say no.
[00:30:33] He's going to come back and he's going to say, okay, we want a 40% discount. You're going to go back and you're going to say no. He said, and then he's going to come back again and tell you that you won't go and have the contract because you are too expensive. And he said, and at this point, you're going to tell him that you will offer them a 5% discount. He is going to come back and he is going to say, no, that discount isn't high enough.
[00:31:04] We need a better price. And then he said, and then you go back again and you say, okay, we will give you a 10% discount. This is our final offer. We cannot go any lower. And then he said, and then this guy will have gotten a decent discount that he can put on his performance review to show that he's met his KPIs and he's done his job as procurement to try and save the company money.
[00:31:30] You have the contract, you're happy with the contract. This guy in procurement has gone and made his KPI. And then he said to me, in the future, you need to add at least ten to 20% extra onto the price of your proposal to cover the fact that the procurement department will be negotiating with you. So from that, I've always carried that story. That story has been with me for over 20 years.
[00:31:59] And it's maybe not always like that in certain markets, but there is still the push for certain individuals who work in procurement with certain companies, especially in the Middle East region in Africa and certain parts of Asia, that it is expected that people who work in procurement have to save a certain percentage with their business. So this is something that you need to keep in mind when you price things. But there are a number of reasons why we would discount. So, for example, there is that whole area that you know that there is the expectation that you're going to have to discount, but then you also might want to look at discounts because you want to win the business or you want to be able to attract new customers. There has been times when I have reduced my price, sometimes to a point where I'm making very, very little profit because I want to have a certain business or government entity as my customer.
[00:33:02] Why would I want that? I would want that because I would blow them out of the water with delivering such a great job that I would then. Go and use that as a case study or an example to go and get other business. So this is where you need to take into consideration if that would be relevant or important to you or your business. You might also want to do a discount as well if you would like to have customers to return.
[00:33:31] If you're a product based business, this is a really nice thing to do. That maybe if people haven't ordered from you for a couple of months, that maybe what you do is you have some kind of automation set up within your system. That if they haven't ordered from you in two months, that you email them automatically with a discount that says, hey, we've not seen you for a while. Why don't you come back, we'll give you a 10% discount on your next order. There's a company that I order eco friendly toilet paper and tissues and paper towel and all of this stuff, they're, they're all made out of bamboo.
[00:34:08] And the thing that I like about them is they come in these really pretty packaging and it just, it looks so pretty that it's kind of nice to even have on display in your bathroom. Or even the tissue boxes look quite cool because I always find that tissue boxes are so ugly and these ones are quite cool and pretty. So Jen likes pretty things, I like pretty things with them. But what I notice happens is if I haven't done an order after a couple of months, she always sends me an email reminding me saying, hey, here's your discount code, we miss you, come back. And I always see that as a reminder to go and order.
[00:34:46] Who doesn't love a discount? And I reorder my tissue paper and my toilet paper. Other reasons why you might want to do that is that you could also sell old or unwanted stock. Maybe you've had stock for a while and you want to have a bit of a refresh. Or maybe it's not so stylish anymore that by offering it at a discount, even if it's just a little bit of profit, sometimes just helps you shift.
[00:35:16] That gets rid of all of that old stock and you can start getting some new in as well. Another reason why discounting can work too is it helps you get cash flow in quickly. Now, I have provided discounts before if I am able to get the cash flow in. So if you have a customer that is really asking for a discount, you can say to them, okay, I'm happy to give you that 15% discount, 20% discount, whatever you feel is a discount that you are able to offer, but it needs to be paid in advance. And so that enables you to get your money in right away.
[00:36:00] And especially if you're in an industry where your clients can be very slow at paying that this can be quite a good way as well. For looking at discounts. And when we're doing our discounts, there's so many different ways that we can do it and the sky is the limit. So, as I was saying, you could look at giving discounts if people pay early, you could do discounts around a holiday. So you might as part of your forward planning, because we are always planning within our businesses that you might look and go right, there's four key holidays or dates that we really want to focus on, so we will put on an extra discount around these seasonal occasions.
[00:36:44] Or you might not want to do that. You could also look at doing other things as well, like having extra value added services. So for example, you purchase one thing and then you get something else that goes with it, maybe. For example, I was talking to one of our members the other day and her company builds swimming pools and I was saying to her so after you've sold them a swimming pool, what is it that you are able to provide? Or is it just very much you have a one off customer and that's it?
[00:37:18] And she was saying no, that what they do is there's the whole value added offers that they give to their customers. So you might have a swimming pool, but then they are providing landscaping to you, that they are providing maintenance of your swimming pool, that they've set up an extra company that not only will they build your swimming pool for you, that they will also go and maintain that swimming pool for you as well. You could do things too, like you buy three, you get one free or you buy a certain quantity and you get a discount. Buy one, get one free, whatever it is that works for your product or your service. Sometimes too, you'll see bundled products or services, but I think you want to be careful with this because sometimes you'll see the bundled products or services.
[00:38:05] So they'll say you buy this certain product or you buy this certain service and then you get ABCD with it. And sometimes businesses will look at basically giving you their rubbish stuff that nobody's bought. So it's sitting inside the cupboard, it's covered with dust, nobody's bought it for years and they just want to offload it. I kind of have problems with that because I feel that in business that we should always be authentic and act with and integrity. And if we're offering rubbishy sort of stuff, it could potentially damage our reputation as well, that customers feel slighted if you're offering them junk.
[00:38:48] So just be aware of that if you are doing things like bundled products or services to make sure that it is right for your business and for your customers. The other thing as well, when you have your pricing, is that I want you to be aware of if your pricing is right and if you are focusing your efforts on that right, product or service. So I'll give you an example that I met one entrepreneur and she had two really successful products in her business. One was a low ticket product that cost about $10. It didn't cost her a lot of money to make.
[00:39:33] Well, she was selling that product for $10 and it was probably costing her three or $4 to go and make that. But then she had another product that she was selling for $3,000, but her cost of going to make it was about $50. So that $3,000 product was actually very profitable. But I found it really interesting because when we were talking she was saying to me that she loves the low value offer because it's really easy to go and sell and everybody loves it and she just goes and tells everybody about it. And because it's $10, it's a no brainer.
[00:40:17] People have no problems parting with their $10. But the issue with that was she wasn't making a lot of money. So she was selling, let's say, 200 pieces of the $10 product, but only one of the $3,000 product because it took a little bit more effort to sell. It wasn't a no brainer because it was a little bit more costly, but her profits were much higher. So this is where we want to look at how much profit we're making on each of our product or services and make sure that we are selling at the right price and that we are focusing our energies on those products or those services that are going to maximize our profit.
[00:41:09] I learned this the hard way in business because we like to focus on what's easy, right and what's fun. And sometimes those are not the things that are going to make us the most money. And I had this in 2022 actually, as I had a real review of everything that we were offering in Female Fusion Network and thinking about other areas that we might end up offering within the business for our members. Because we often get asked by our members, oh, could you offer this, could you do this service? Could you do that?
[00:41:42] And I love to over deliver. I love to really surprise and delight our members. And so we use a project management system called Monday and we're always creating Monday boards across the team. And one of the Monday boards that we have is one about ideas for new services that we could be introducing for our members. And one area that we were asked to do, I've been asked several times, is to create a mastermind for our businesses.
[00:42:18] For those of you that don't know what a Mastermind is, it's basically where you will get a group together who have common interests. So in our case, it would be female entrepreneurs and to work together jointly on building your business. So it might be in a specific topic around marketing or sales or finance and fixing those areas within the Business, or It Could Be More General Around Business And Entrepreneurship. So our members were asking for something that was more general around business and entrepreneurship, and in particular, that would help them reach either six figures if they were five figure businesses or seven figures if they were six figure businesses. And I looked at that, and I would love to do it.
[00:43:07] I love to help, and I love to be able to work with female business owners and our members because they're just so incredible and so inspiring. But I looked at it and realized that it would take us at least a couple of years of offering it to be able to have it so it would be profitable to run a mastermind. So I looked at that and thought, with everything else that we have going on in building Female Fusion Network and growing this business, that as much as I would love to be able to offer it, now is not just the right time, but it could be in a few months or six months or a year from now. So it still lives on our Monday board. So if you're one of those who's asked me to do a mastermind, it's still there.
[00:43:53] It lives on the Monday board, but it's just not the right time yet. It will be in the future, though. Absolutely. The last area I'd like to talk to you about is increasing your price. And this is something that entrepreneurs feel very uncomfortable with and oftentimes wait until too late to go and increase their price.
[00:44:17] Now with the way that the world has been going over the several months and years that we have faced, prices have gone up. The prices that we are paying for products, for services, everything is going up. And so there comes a time when you need to look at increasing your price in your business. Or maybe you started out low in your business and you did that so you would be able to get extra customers. And then it comes to a point where you realize that it's not going to help you grow your business if you are charging such a little price.
[00:44:51] And I see this a lot with our members, and there's a number of members who I almost dedicate this little spot in the podcast to. And I think you know who you are because we've had several conversations about this, is that increasing the price of your product or your service is one of the quickest and easiest ways to add more profit into your business. And it depends upon how much you're going to increase your price. But oftentimes it can make pretty significant impact to your business. So, for example, some people might look at increasing their price of their product or service by only five or 10%.
[00:45:39] And normally, customers are pretty good at accepting that because that's just inflation. Cost of living. Everything else comes into play. And fact of life. Prices need to go up. [00:45:53] Other businesses might double the price or triple the price. And that sometimes can be a little bit harder to communicate. But that also means as well that if you're going to look at doing that within your business, oftentimes the people who have been your customers might not be your customers anymore. And you might be targeting completely different customers. And that might work for your business, and that might be the right thing, or it might not.
[00:46:25] And you might increase your price and nobody buys from you. The good thing is, is that we're not stuck indefinitely with a price a certain way that you're always able to say that you made a mistake and that you change it. So if you are increasing your price so it's really important that you have integrity around this and that you have good communication when it comes to speaking with your customers or clients. So if you are increasing your price and it is going to impact your customers that it's important to know when the price increase comes into effect and by how much. Now what's interesting though is that a number of businesses will increase the pricing for new customers but not for older customers or their existing customers.
[00:47:18] Technology companies are big ones around this, where they'll often say, right, to reward your loyalty, we will give you the same price that you joined on no matter when it was and however long you stay with us. And so that's rewarding the people who support their business early and get in there earlier because they're rewarded with price. So, for example, we did that with Female Fusion Network when we started and I'll tell you quite openly that when started didn't know that much about a membership and so creating a membership we kept the price quite low to begin with. And that was done deliberately, because I didn't want people to have massive, massive expectations about what was going to be delivered when we were still working out what that was. And so those people who joined early, who supported the business, who stuck with Female Fusion Network are the ones who are rewarded with the low entry price that we had when we first started out the membership.
[00:48:21] And if you speak with some of our founding members as well they'll tell you that what the membership looked like when they first joined compared to what it is now is completely night and day but you expect that and so they're rewarded for their support and loyalty that they will forever have that founding member price. So that is something that you could maybe consider depending upon what it is that your business does. If your customers are going to have a price increase though it's really important that you tell them and you explain to them why the costs are going to be going up. Don't just charge them the new price and not say anything because that just feels icky to customers and they don't really like that. And that could be a way to turn customers off in your business. [00:49:08] But if you are going to be increasing your price, talk about the value, talk about the quality of what you're offering. So the price might be going up, but they're still getting this great value, great quality, and they will probably be a lot more supportive to know that for you to deliver that high quality or the top service that you need to charge more because everything that you're paying for is costing more as well. But if you do do that, make sure that you are very clear about that and you explain to them what's changing in terms of the pricing and when it's going to be changing as well. And make sure as well that you're transparent and clear about it and don't try to hide it. I believe in business integrity and authenticity and transparency in communications means so much.
[00:50:02] And customers will trust you much more if you're going to be honest with them. So if you have to increase your prices, you have to increase your prices. And over the past year, we've had a number of businesses increase their prices. I still deal with them, they're still my supplier. But then I've also been beneficial that there have been a number of suppliers that I have that haven't increased their prices because I've been with them for a long time and that means that they're rewarding me for my loyalty.
[00:50:35] So those are things that you might want to think about as well. Do you reward existing customers or clients with loyalty and not increase the price and only increase the price for new customers or clients? It's up to you about what's going to work for your business. But this also comes down to as well, why it's so important to be so clear on who your ideal paying customer is and what it is that their expectations are and what they are looking for. Because we get the pricing right, we get that in a way that we're going to build up such a loyal fan base of customers and clients who are going to want to work with us, that it ensures that we're going to have more regular customers, more regular revenue coming into the business as well.
[00:51:26] And as I often say as well, that revenue is vanity. So that money, that number that we see coming into our business means nothing. At the end of the day, profit is what gives us san energy. So the profit is the money that we retain in our business. If you need to increase your price to ensure that you have more profit in your business, you can't keep your prices the same forever.
[00:51:54] So that is okay to do as well, but just make sure that you have all of that information to begin with so you can make the right decision in your business so you can start bringing in more profit to build, grow and scale your business. That's it from me for this time. I hope you found that useful and I'll see you on the next episode of the podcast.
[00:52:27] Thanks for listening to this week's episode of the podcast. If you'd like to join our membership, the doors are currently closed, but if you put your name onto the waitlist, you'll be the first to know when we're accepting members again. If you're a female entrepreneur, this is the best place for you to connect with other female business owners and work on starting, building, growing, or scaling your business. You can find out more information in the show notes or on femalefusionnetwork.com/join