book

Pricing for Profit

Name: Pricing for Profit
Author: Peter Hill
ISBN: 9780749467685

by Peter Hill

July 2013

Beginner to intermediate

280 pages

6h 29m

English

Kogan Page

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Cover
Praise for Pricing for Profit
Title Page
Imprint
Contents
Acknowledgements
Introduction
01 Pricing in context
How any business can improve its bottom line The Five Ways to Grow a business Why people fail to see the problem as a price issue Summary Action points Reader challenge
02 Why is pricing so difficult?
The importance of knowledge and training How to avoid the impact of your bad experiences Blindly copying the big retailers Limited financial understanding of how profits are made People’s desire to please, and their freedom to do so People need to be properly motivated to change Summary Action points
03 The remarkable benefits of getting pricing right
Understanding what you actually charge at the moment Increasing the headline price (but with added value) How you can charge more when you guarantee value Making sure your frontline people understand the profit equation Summary Action points

04 How most businesses price and why these methods are wrong
Cost plus pricing – the fundamental flaw Undercutting competitors – it simply cuts your profits Last year’s pricing plus a bit – the bit is never enough Best guess pricing – it’s just a stab in the dark Value to each customer – the only pricing strategy that really works Summary Action points
05 Understanding value versus cost
The value Scales What happens when the scales don’t balance? How to balance the scales The dissipation of value over time The importance of discussing value with customers Summary Action points
06 Packaging for higher prices
The four ways to maximize each sale Using price to up-sell and cross-sell Offering choices increases the value of the sale Alternative price options affect the perception of value of all options Setting price differentials properly The price of pain Summary Action points
07 Customers don’t always want the cheapest
Increasing prices doesn’t automatically mean losing customers Summary Action points
08 Exploding all of the myths about pricing
Myth: Customers only want the cheapest Myth: Loss leaders work Myth: A 50 per cent off sale is a 50 per cent off sale Myth: Presentation of the price doesn’t matter Myth: All prices should end in a ‘9’ Myth: The best person to set the price is the salesperson Myth: Setting prices is a once a year decision Myth: Every customer is worth having and every sale matters Myth: Raising prices loses customers Summary Action points
09 Using guarantees to get increased prices
Risk versus reward Price-match guarantees Using guarantees to add value to your side of the value Scales Offering options with and without guarantees Customers are fundamentally honest Offering a guarantee as an extra Summary Action points
10 Discounting
Who is affected by poor discounting practices The financial dynamics of discounting The impact of a small change in discounts Discounting prices to win customers is a myth The top four reasons people discount How to limit discounts When discounting is right Summary Action points
11 Presenting the price properly
The impact of the price ticket The significance of clarity Accuracy is key The importance of the actual numbers Presentation of price on bundled items When to reveal your prices Using words for impact Summary Action points
12 Directional pricing
The advantages of moving customers to alternative options The pizza example The critical issues to know Setting extreme prices to make other offers seem comparatively attractive Summary Action points
13 Dealing with the human factor
Most people running a business are untrained for that role Conscious competency Don’t be afraid to get external input The key people in the profit equation Handling your team’s need to please customers Helping your team focus on profit Dealing with the human factor in your customers Fear! Summary Action points
14 Getting financial clarity
You need to know the numbers Not all customers make you money Steps in the profit calculation Summary Action points
15 Your action plan
Have a vision for the future Build your team and allocate resources Set smart goals Just do stuff! Two questions, with answers
16 The final word on pricing for profit
Index
Full imprint

Content preview from Pricing for Profit

How most businesses price and why these methods are wrong

Having worked with hundreds of businesses and business owners over the years, the mechanics of how most prices are set can be boiled down to just four main methods. We need to explore each of these so that we understand them, and to explain the weaknesses in each method. Having done this we then consider the only critical element of pricing, which is to better understand the value your customers place on what you do.

This chapter considers four principal pricing strategies, and then the only one that really works:

Cost plus pricing – the fundamental flaw.
Undercutting competitors – it simply cuts your profits.
Last year’s pricing plus a bit – the bit is never enough.
Best guess pricing ...

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Pricing for Profit

by Peter Hill

Become an O’Reilly member and get unlimited access to this title plus top books and audiobooks from O’Reilly and nearly 200 top publishers, thousands of courses curated by job role, 150+ live events each month,
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