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Lowering your prices, but not your profit
Most of the country is still dealing with loss of jobs and people worried about paying their bills. Here in the Northwest, we got hit with the recession about 6-9 months after the east coast did.
It seems the east coast is finally coming out of it a bit, but we are still 6-9 months behind.
Our clients are in the upper middle class, and they seemed to have done better than most. That being said, one of the nicest neighborhoods in my area is starting to feel the pain. This is my main client base. I noticed when I was shooting my senior reps this year, that the moms were talking a lot about money. You need to listen to your clients and respond before they do.
The dilemma is that if I just lower my prices on everything, then I am just doing what I have been preaching not to do. How can I give my customers something a little more affordable, but still keep my profit margins?
The answer is smaller packages!!!
I used my same pricing scheme of 4 packages, but what I did was make my packages about 15% smaller. It looks like I lowered my packages, but in reality I just took some product out. After going through my pricing, I think I have actually made my upper packages more attractive. In the end, I bet my profit margins this year will be way up. My $1500 package last year that my profit margin was around $1200 is now a $1300 package and my profit margin is $1100. So by “lowering” my packages, I actually am making a higher margin.
It’s a win win for both my clients and my business.
Kevin
Good thinking Kevin. I was going over some pricing a couple of days ago and adjusting packages. I think the way to go is reduce the number of wallet size. Replace them with a low res digital image for the social network thing.
I think they will still try to print the low res bigger than it should and then you will look bad.
Kevin