I know that offering discounts SEEMS like a great way to grow your sales and put money in the bank BUT let me share some hard numbers with you BEFORE you give away your profits:
- If your margin on your product or service is 50% and you offer a 10% discount on your product or service then you would need to increase your sales volume by 25% to be in the exact same place.
- If your margin on your product or service is 50% and you offer a 20% discount on your product or service then you would need to increase your sales volume by 67% to be in the exact same place.
So my question is, is it worth it? I say no. Discounts are a race to the bottom. I prefer to add value to every sale. What I mean by that is rather than discount for product or service, make it more valuable to customers. Get it? Don’t give away your profits!
Let’s discuss how you can stop offering discounts and start offering value. Make the buying decision easy. Make the offer to buy so enticing that price becomes a secondary issue to the need to have what you are offering. Making sales and growing revenue is an art and not a science.
Pricing is one of the hot topics I always touch on with clients in my one on one intensive day. I am not a sales coach and I am not a sales expert. I am a profit expert. I know how to put money in your pocket and sometimes that means we have to address pricing as part of our approach to profit.