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Sunday, March 25, 2007

Competitive Pricing: Where Should Your Rates Be?

Using competitive pricing is a good means to determine rates to clients. A competitive pricing plan is one with rates based on what other companies like yours are charging.

The local market will be your guide to figuring out the competitive pricing range. How do you put yourself in the mix?

Two Main Consideration Points of Competitive Pricing:

1. The skill level of your competitors and their staff;

2. The size of your target client company.

The companies you look at to figure out your competitive pricing can range from independent PC repair technicians to small consulting firms. They will range from moonlighters to full-time, solo practice consultants. Competitive pricing can help you decide which type of business best matches yours so you can do appropriate research.

Stay within the upper ranges of competitive pricing. If you set prices too low, you will not attract the best clients that will have high commitment levels and are willing to pay top dollar for top services. You don’t want those hunting based on low prices.

The Main Point of Competitive Pricing

Before setting a competitive pricing range for your company, you will have to think about your competitors. Once you have determined these factors, you can set a competitive pricing model based on the high end of the appropriate scale.

Blogged By: Joshua Feinberg