Are You Racing to the Bottom or to the Top?

There’s a lot of talk in the small business community about keeping your prices low and attracting more customers. But I want to make a case for why you should increase your prices every year, even if you’re a small business. It may seem counterintuitive, but by increasing your prices, you can actually create more value for your customers—and yourself!

There are several reasons why small businesses should focus on increasing their prices. Firstly, by charging more for your products or services, you are signalling to your customers that they are getting something of value. This can help strengthen your brand and differentiate you from your competitors.

Secondly, constantly raising prices helps ensure that small businesses stay profitable and sustainable in the long term. If you continuously try to compete on price, you may be in a race to the bottom that is unsustainable for your business. Instead, by focusing on delivering value and charging accordingly, you ensure that your small business will remain viable and profitable for years to come.

Thirdly, increasing prices can also help small businesses stay focused on their core competencies. If you are always competing on price, you may find yourself stretched too thin trying to keep up with other companies that offer similar products or services. By charging more and focusing on your own strengths, small businesses can stay true to their vision and continue to provide high-quality products or services that genuinely add value for their customers.

So if you’re a small business owner, don’t be afraid to increase your prices yearly. By doing so, you can create more value for your customers, stay profitable and sustainable in the long term, and focus on what matters most: your core competencies. And that is sure to give you a competitive edge in today’s crowded small business landscape