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“No Thanks – You’re too Cheap”

The secret to asking more for your goods and services instead of less.

Douglas Kruger

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Too-Cheap

Most entrepreneurs are more terrified of pricing than they are of Freddie, Jason, Chucky, Norman Bates or Honey BooBoo. When asked, ‘How much?’, they squirm in their socks and twist their intestines into embarrassed loops. Then they apologise and offer a discount, without having been asked for one.

What they don’t realize is that their value is perceived in relation to their fee. Low fee, low value.

A great many entrepreneurs actually undercharge. Position yourself as the cheap alternative, and, ironically, you might find yourself doing less business. People largely judge value and quality based on price, which, in turn, is why Mercedes-Benz hasn’t gone broke, in spite of its premium pricing. It’s part of the reason Apple rules the world.

Your starting point is to show pride in what you do. Your business is your baby, after all. You spend a significant percentage of your life growing and cultivating it. Don’t disrespect it with miniscule profit margins. Practice healthy profit margins that recognize and reflect your input and expertise, and then have the sense of self-worth to charge correctly with confidence.

Of Course, You Have to Be Worth It

Pricing and positioning are art forms. The danger is that you are simply seen to be overcharging for an inferior product. Not only is that unethical, but it only takes two or three clients getting burned before the word gets out and your business falters.

No, you have to actually be the quality for which you charge. But if you are the Mercedes-Benz of your industry, you are entitled to charge a premium. And your market will expect it and pay it.

It’s an interesting psychological game: The more you put your price up, the more you will be seen as a quality offering. The higher the quality of your offering, the more you can put your price up.

So if you’ve hit a ceiling of income-to-capacity in your business, and want to earn more, consider whether you are simply too cheap.

Here are four suggestions on how to go about raising your price:

1. Start by firing your low-paying, high-input clients

They are a drain on your time, they are not worth the financial reward, and perhaps most importantly, their high visibility in your own consciousness will keep you believing that you operate at that level. After all, if you see them often, they are your norm.

Give them up to the entry-level operators. Choose instead to own the top end of the market.

If you’re having difficulty with this idea, think about it this way: Doing one job for 30 coins is worth more than doing three jobs for 10 coins. How do I reach this seeming mathematical impossibility? Consider: Each job implies a certain amount of cost.

If you do one job for 30 coins, you will incur one cost. If you do three jobs for the same amount of money, you will be down by three instances of cost. Doing less work for more money is exponentially more lucrative.

2. Dump the bricks and carry gold

What do you offer that is high-input on your part, but low yield in remuneration? Are you scrambling to sustain the small profit margin part of your business? Perhaps it’s time to dump it and focus on the high-yield stuff. You don’t have to be all things to all people. Rather be the thing that generates high income.

3. Research your competitors

Find out what the top-level operators in your industry are charging. Try to position yourself in the middle-to-upper cost range of your industry. Never position yourself in the lower cost range. If you do, you become a commodity, which means that you are interchangeable. That’s not clever positioning. Also, it will become remarkably difficult for you to raise your value later on.

However, don’t be the most expensive option until you know you are worth it. Keep it as a goal and work toward it.

4. Put the word out

Knowledge alone will not cause your market to see you as the leading name. Nor will mere competence. These qualities are important, but in isolation they do not create a valuable reputation. Add publicity to the mix and suddenly your knowledge and competence become renowned. Keep publicizing yourself, and you may ultimately become iconic.

Experts and iconic names are able to charge more, because the business comes to them. They are desired and sought out as unique and valuable. Price becomes a secondary concern in acquiring their services. In fact, sometimes a high price even means bragging rights for the buyer.

I advocate finding forums in order to achieve high-level status by design. Appear on radio talk-shows with interesting messages pertaining to what you do. Appear on TV. Get into newspapers and magazines. Speak in public as often as possible. Create and publicize new ways of doing what you do. Be unique. Be the best, and let the world know about it.

The next time you have to state your fee, state it with confidence. Don’t cringe. Don’t blink. Don’t rush to offer discounts. You are building a business, growing a brand. You are on an upward trajectory, and pricing is an important tool in your propulsion. Don’t be afraid to use it.

Douglas Kruger is the only speaker in Africa to have won the Southern African Championships for Public Speaking a record five times. He is the author of ‘50 Ways to Become a Better Speaker,’ published in South Africa and Nigeria, ‘50 Ways to Position Yourself as an Expert,’ and co-author of ‘So You’re in Charge. Now What? 52 Ways to Become a Better Leader.’ See Douglas in action, or read his articles, at www.douglaskruger.co.za. Email him at Kruger@compute.co.za, or connect with him on Linked In or Twitter: @DouglasKruger

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Strategy

4 Ways To Find Your Own Business Style

The only way to develop a business style is step-by-step over time.

Timothy Sykes

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business-style

Finding a style in finance will define how you react to changes and how you approach new situations. It’s as important in business as it is in stock trading. Developing a business style and developing a stock trading system are extremely similar pursuits.

But I’m not going to pretend that it’s easy to do. It will take time and you do have to be willing to work at it.

Here are my four ways of finding your own business style.

1. Get rid of your expectations

You can’t force anything to work. It’s necessary for you to be flexible when it comes to finding a business style. Begin by letting go of any expectations you have before trying a new style.

Prior to attempting a new style, you have to be willing to go into it with no expectations. You never know what you’re going to find.

Related: 8 Steps to Building Your Business According to the Lifestyle You Want

2. Track your movements

Some things are going to work and some things aren’t going to work. I always tell my students in the Tim Sykes Millionaire Challenge that they should keep records of the things they’re doing. Keep these records as detailed as possible because attempting trial and error can quickly lead you in circles.

Don’t fall into the trap (as I did in the beginning) of trying the same thing multiple times because you never tracked the results.

I keep large spreadsheets with notes of the various styles and systems I’ve tried in business. Business mistakes can be costly, so you need to do everything you can to avoid making them.

3. Look at what others are doing

business-options

I refuse to believe that someone is doing something truly unique. The moment someone makes a breakthrough in business there are a hundred people replicating the same things. And that can be a powerful tool. Consider what others are doing and see whether you can learn something.

It’s why I also advocate finding a mentor to help you out. They’ll be able to help you out and you’ll benefit from their enhanced experiences in business.

Again, track what you’re taking from other people so you know whether something is working.

Related: I Started Saying ‘No’ To These 6 Things. My Life And My Business Got A Lot Better

4. Refine what you do

Rarely will anything in business work the first time. However, your first attempts will give you a good benchmark as to what you need to do next.

You should never be satisfied with what you have, even if it’s working. Always work on improving your business style. I believe this is the most important thing because it also teaches you how to adapt to changing conditions over time.

Last Word – Constantly Growing

There’s no step-by-step guide for how to develop a business style. The only way to do it is to obey the fundamentals and then develop everything over time.

Even though the process is long, you’re guaranteed to learn a lot of lessons and gain from a huge number of experiences over time.

This article was originally posted here on Entrepreneur.com.

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Strategy

6 Questions You Should Be Asking When Coaching

Top athletes have coaches because they’re winners. Business leaders should be the same.

Nadine Todd

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Dr Marshall Goldsmith

Whether you’re a CEO looking for a mentor, coaching your management team, or structuring a coaching programme for your managers to implement, there are six questions that can help anyone get better at anything.

The expert

Dr Marshall Goldsmith is a best-selling author and world-renowned business educator and coach. He has coached top CEOs, including Alan Mulally, former President and CEO of Ford Motor Company.

The key to a successful coaching programme is simple dialogue and establishing responsibility. The person being coached must understand and agree that success lies in their hands. They must take responsibility for their actions.

Related: How Business Coaching Can Help You Achieve Your Goals

The method

Once every few months, have a direct coaching session. Ask (or answer for yourself) these six questions:

  1. Where are we going?
  2. Where are you going?
  3. What are you doing well?
  4. Do you have suggestions for my improvement?
  5. How can I help you?
  6. So you have suggestions for me?

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Strategy

4 Ways To Develop The Leaders You’ll Need In The Future

One of the most challenging aspects of leadership development is consistently and effectively identifying the next wave of leaders.

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leadership

One of the most challenging aspects of leadership development is consistently and effectively identifying the next wave of leaders.

It can be easy for those at the top to forget that eventually someone will have to take their place at the helm. And ignoring that fact has lead to issues with succession planning, unwanted turnover and other challenges in leadership development in many organisations.

2016 High Impact Leadership research from Bersin by Deloitte asked 2,422 HR and business leaders from around the world how well they believed they could discover new leadership talent. Just 35 percent of respondents said they were above average when it came to successfully identifying and developing leaders.

To understand why this is, consider the typical leadership development paradox. Traditionally, the first step is to choose who has leadership potential, then develop their skillset. Logically, however, this makes little sense.

How is it possible to identify effective leaders if employees have yet to receive any type of leadership development?

Here are four ways to properly identify better qualified candidates for leadership positions:

1Stop choosing potential leaders based on unrelated skills

Gallup’s 2015 State of the American Manager Report, which studied 2.5 million manager-led teams in 195 countries, found that the top two reasons employees are promoted to management positions are because they were successful in a non-managerial role or because of their tenure with the company. Neither of those criteria have any proven correlation with leadership skills or relevant experience.

Create a better means of measuring for true leadership potential. Look at the culture of the organisation and envision what it would look like for someone to lead by those values.

Also consider how successful leaders evolved over time in the organisation. Then use that information to make a list of recognisable traits to look for as signs of leadership potential.

2Broaden leadership development to more employees

People learn and grow at their own unique pace. Requiring that an employee reach a certain position or be with the company for a certain number of years before they’re offered leadership opportunities holds back those who might be ready for more responsibility now. Or even worse, it might push those who aren’t yet ready into leadership roles.

Instead, let leadership development be a company-wide initiative. This gives more people the chance to take the next step in their career. It also creates a larger pool of possible great leaders to draw from across the organisation.

3Track progress and growth

Track progress and growth

There’s no way of knowing who is ready to step up and lead unless development is monitored. Remember that this is a process. Employees need feedback from their mentors and coaches to know for certain what skills they’ve mastered as well as where there can still be improvements made.

Develop a way to assess progress for different leadership positions, and be clear with employees and coaches about what success would look like in different situations. For instance, explain what is expected of a first time project leader.

Get everyone on the same page about the developing leader’s responsibilities and how that should guide their team.

Then collect thorough feedback from all those involved. Ask the leadership candidate what challenges they faced as well as where they think they thrived. Pose the same questions to those they supervised and organisational mentors.

Over time, this will reveal patterns that make it easier to identify who is best suited for leadership in the long-term.

4Focus on continual leadership development

There is no such thing as too much experience. There is always more that can be learned. After leadership candidates have been identified, continue to nurture them. This keeps employees from feeling that they have plateaued, which is unfortunately common.

The 2014 Insigniam Middle Management Survey: Middle Management’s Critical Role In Saving Company Innovation looked at responses from 200 middle managers from around the world. It found that only 15 percent of managers believe they will ever be promoted to the next level of leadership at their company.

Whether intentionally or not, employees who have proven their leadership abilities are being told that their leadership journey is over – and this hurts both them and the organisation. Encourage a steady stream of highly trained and skilled leaders working their way up by demonstrating that there is no end to development.

In order to clearly see who the next wave of leaders is going to be, employees need to be given the chance to hone and exercise their skills.

That means redefining how leadership potential is identified and providing each employee with the chance to develop personally and professionally.

This article was originally posted here on Entrepreneur.com.

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