If you’ve ever allowed a client to talk you into selling a product or service for half of what you originally asked for or you’ve questioned whether you’re really good enough to charge for a certain skill, you’ve struggled with how to value your business. You might even think, but isn’t it worse to be overconfident or overcharge? If you’ve even thought of that question, trust me, you’re not in any danger of the latter—over confident biz owners don’t question their value. It’s good to question yourself and totally makes sense that you would in the beginning, but when you start undervaluing yourself and/or your services, you start to hurt the business.
When you go to the mall, you see several similar products at varying price points. You’ll probably avoid the highest price point, unless you know that product is better than any other. Chances are you’ve also avoided products at the lowest price point, thinking that if it’s that cheap, there must be a reason. It makes sense to do this—it helps us find the best balance between the item we want and the price we need. It doesn’t matter what kind of clients or customers you attract or whether what you sell/offer is high- or low-end, this type of thinking happens across the board.
This means that if you undervalue your service, you’re kind of setting yourself up for failure. You might have attracted people to your business, but once they see that it’s valued so low—and this could be the actual price point you offer X at or it could be the way you don’t project confidence when pitching your ideas to clients—they’ll take that as a sign. They’ll think, If she doesn’t value her product, why should I? (And the ones that don’t think that will barter/argue/show you that they value your business just about as much as you do—not much. Nightmare client alert.)
the problem with businesses and undervaluing
I started noticing businesses undervalue themselves when I bought, sold, and networked with other shop owners on Etsy. People would post links to their stores in the forums and ask for a shop critique. Whenever someone had beautiful handcrafted items or well curated pieces priced surprisingly low, it wouldn’t be long before the comments were pouring in suggesting a raise in prices—either because other artists wouldn’t want to buy from a shop that doesn’t know what the hell they’re doing or they figured something must be wrong with the item.
Our current income at FDM isn’t based off of physical product, but the principle is the same. When we first started, not only was pricing for services tricky, but pitching those services. And it wasn’t because we didn’t think people needed what we offer—all the emails and comments we got were evidence enough. Actually, the problem was that so little businesses (agencies or otherwise) do what we do, specifically. There are plenty of web designers and content editors but how many of them have experience working with influencers, or connecting those influencers with brands? Not one time has a potential client turned us down in favor of someone else. So it took awhile to see that the trouble was valuing that necessity that many people have and helping them realize their potential in the digital space. Here’s what helped us, and will help you too:
four ways to value your business
Establish the need. There’s a reason you started your business. You want to help people do X or provide people with Y. You may already have this in mind but it’s good to keep the reminder handy. Write down the WHY somewhere, and whenever you have to make a pitch, offer or service, or price an item, refer to that need.
Don’t send weak emails. Each email you send should have intent and properly reflect your business. Weak emails are basically open invitations for people to undervalue you—they make it seem like pricing and services are fluid and make way for inappropriate requests and demands. Sending strong, confident emails let inquirers and customers know that you really DO know what you’re talking about, value your work, and aren’t willing to compromise on those core principles. And yes, you can do that while being charming as hell.
Structure pricing. We simply can’t price each thing the same for everyone, because each service we offer personalized. We can, however, make sure not to give someone a massive discount just because they seem cool or charge someone more because they seem like they’ve got money to burn. Neither of those take the nature of the service we’re providing to someone into account, nor our hard work or expertise. Same goes for changing that structure for each person that says their budget is tight. Because let’s face it. 100% of people have a tight budget. It’s a fact.
Evolve + reevaluate. When things change—when a product/service becomes more involved, offerings increase in scope, or the costs of running your business increase, you’ll have to reevaluate again and determine if you truly value yourself. I think most of the time, it’s not a matter of if you’ve got that skill or perfect product, or even whether you believe in it—it’s finding out how to accurately share that you DO believe in it, and not let that little voice in your head (or the voices of haters on Instagram) talk you down from that value.
Now the big question is, are you valuing yourself how you should be? Let us know!