Transcripts
Welcome to Live With The Pricing Lady.
Speaker:I'm Janene, your hostess.
Speaker:This show is all about helping you build a sustainably profitable
Speaker:business while making an unbelievable impact on your world.
Speaker:Learn from my 20 years of experience and from my guests as we discuss their pricing
Speaker:challenges, failures, and successes.
Speaker:Pricing is a way of being or behaving in your business.
Speaker:My mission is to help you confidently charge for the value you deliver.
Speaker:Pricing is either hurting or helping your business.
Speaker:Let's make sure it's helping you reach your dreams.
Speaker:Is profit a four letter word, something you should fear in your business.
Speaker:Of course not.
Speaker:And that's not just because there are six letters in the word profit.
Speaker:Many business owners shy away from pricing and math because they're
Speaker:afraid of being viewed as greedy.
Speaker:If they focus on profit in their business.
Speaker:In this episode, we'll explore the roots of those feelings.
Speaker:And the steps you can take to shift your mindset.
Speaker:Sit back, relax and enjoy the episode.
Speaker:Today we're talking about why profit isn't the bad word that you think it is.
Speaker:Now, one of the reasons I wanted to talk about this is because often what
Speaker:happens is people come to me, they're looking for help with their pricing or
Speaker:with their strategy and their business.
Speaker:And they say, Oh, you know, Janine, I really need your help.
Speaker:And then in the next breath, they say, But I really don't care about the money.
Speaker:And I always find that a little bit amusing, right?
Speaker:Because obviously they wouldn't be there asking for help if they didn't
Speaker:care on some level about the money.
Speaker:And at the same time, I think it's really important as a business owner
Speaker:to, you know, confess to yourself that you actually do want the money.
Speaker:Yeah.
Speaker:Now we're going to talk about why people have this perception
Speaker:or why the word profit has this negative connotation to it.
Speaker:But then we're also going to take a look at what it is that profit brings to your
Speaker:business and why it is so important that you do pay attention and that you're
Speaker:of the mindset that money does matter.
Speaker:Now, one of the things I have said since almost the day one,
Speaker:when I started my business is that profit doesn't make you greedy.
Speaker:It makes you smart.
Speaker:And I wholeheartedly believe that, but we will talk about why you might
Speaker:have a different perception to that.
Speaker:So let's get started.
Speaker:So as I said, This is really rooted, this feeling that we have that
Speaker:profit is a bad word is rooted in the mindset that we have towards money.
Speaker:Now, is it bad?
Speaker:I say absolutely not.
Speaker:When you are earning profit through, let's say, sustainable and
Speaker:ethical means, it is an enabler.
Speaker:It is going to help you get financially independent is going to help the economy.
Speaker:It's going to help you possibly employ people.
Speaker:It is going to help bring more innovation into the world.
Speaker:For me, it is simply an enabler.
Speaker:Like money is an enabler.
Speaker:Profit is an enabler in your business and also in your life.
Speaker:And we'll look at that in a moment.
Speaker:But why does it (profit) get such a bad reputation?
Speaker:That really comes down to a perception that people have around greediness.
Speaker:You know, so we kind of think of Scrooge McDuck sitting there with
Speaker:piles of money all around him and he's hoarding it and whatever, right?
Speaker:And we see that as a negative thing.
Speaker:In many ways, we've been brought up to think that.
Speaker:We've seen people go after profit at the expense of the
Speaker:environment or animals or different demographics of people or countries.
Speaker:That gives it a bad connotation.
Speaker:We've had people who have done unethical things in the name of profit.
Speaker:And it's happened in the past.
Speaker:It's probably going to happen from time to time in the future, but that
Speaker:doesn't necessarily mean that you are greedy if that's ie profit what
Speaker:you're focused on in your business.
Speaker:Even culture plays a huge role in our perception around profit being
Speaker:greedy, especially as women, oftentimes we are raised and brought up to
Speaker:give, give, give, to be shy about accepting things in return for that.
Speaker:Then when you go and you start your business, And you have to ask for
Speaker:an exchange of value for a price for, for what you offer that can
Speaker:feel really uncomfortable and at odds with what you've been raised
Speaker:to believe is appropriate behavior.
Speaker:This is why it profit has such a negative connotation.
Speaker:Now, if I go back to what I said at the beginning, that pricing or
Speaker:profit makes you smart, not greedy.
Speaker:I'm not talking about chasing after profit at the expense of
Speaker:other people or other things.
Speaker:I'm talking about being smart about profit being one of the
Speaker:objectives in your business.
Speaker:In my estimation, profit is actually a measure of, one measure, let's be
Speaker:clear, of health in a business.. I always joke with people, and if you've
Speaker:ever had anemia, you'll get this analogy really quick, that pricing
Speaker:is to profit like iron is to blood.
Speaker:So, if your pricing is good, then it'll help your business
Speaker:be profitable and more healthy.
Speaker:Just like if you've ever had to pour iron in your blood, you know
Speaker:how lethargic and slow you feel.
Speaker:It's similar when pricing and profit isn't right in your business, your
Speaker:business really suffers from it.
Speaker:You must, as a business owner, understand profit, because every decision you make
Speaker:in your business has an impact on it.
Speaker:You may think it's the most innocuous decision.
Speaker:Like one of the questions I get all the time is, should I
Speaker:put my prices on my website?
Speaker:A decision like that is a strategic one and it can have an
Speaker:influence on your profitability.
Speaker:And if you don't understand what impact it might have, it's harder for
Speaker:you to make a decision that's right for you, your business, your clients.
Speaker:Here's three reasons why you want to pay attention to profit in your business.
Speaker:So first of all, let's talk about growth and sustainability.
Speaker:Now, I am all about helping people build more sustainably profitable businesses.
Speaker:This isn't about chasing after profit, at the expense of other
Speaker:things, but it's about helping you to grow more sustainably.
Speaker:In order to build and grow your business.
Speaker:You have to have profit.
Speaker:Profit is what fuels, in part, the business engine that allows
Speaker:you to be there for the long term to be able to serve your clients.
Speaker:If you don't understand it, have a basic understanding of it, it
Speaker:can't really help you do that.
Speaker:Next.
Speaker:It will help you to, I'm just trying to read my scribbles here,
Speaker:make sure I don't miss anything.
Speaker:Later on after you've, you know, been in business a while longer, it
Speaker:helps you to protect, to reinvest, and to innovate in your business.
Speaker:Yeah, so if you're earning profit, then you can set a little money to side
Speaker:to help you out when things go awry.
Speaker:And they do.
Speaker:If you've been in business long enough, you know that sometimes it's tough.
Speaker:Sometimes things happen that you don't expect.
Speaker:A friend of mine in her business, she had an issue.
Speaker:She had an issue.
Speaker:where all of a sudden she had to cover some penalties that were unexpected
Speaker:and it was quite a significant amount.
Speaker:Now if she hadn't had the profit in her business to be able to
Speaker:cover that, she could have found herself in a difficult situation and
Speaker:needing to shut that business down.
Speaker:You want to be able to have a little bit of money to protect yourself in
Speaker:a sense for when things are difficult or when unexpected expenses show up.
Speaker:Reinvest the money.
Speaker:Yeah, so if you're earning profit, then you have the opportunity to reinvest
Speaker:that money back into the business that can be in the form of training,
Speaker:that can be in the form of developing new products or offers or the app
Speaker:you've already wanted to develop.
Speaker:It enables you to be able to reinvest back into the business, which helps
Speaker:you to be more competitive in the market or bring better solutions
Speaker:to your clients and your customers.
Speaker:And then, of course, we're talking about innovation and innovation
Speaker:requires additional resources that probably will cost you something.
Speaker:So let's say you have an app and you want to revamp the app.
Speaker:Again, we're talking about needing money in order to make those investments
Speaker:to be able to innovate further and bring better things to your clients.
Speaker:And the last reason why is more of a personal reason as opposed to the last
Speaker:two, which were more business oriented.
Speaker:It brings you and your loved ones, financial independence and empowerment.
Speaker:By having a profitable or more sustainably profitable business, you'll
Speaker:put yourself into a better position.
Speaker:You have more control, or at least you feel more in control
Speaker:of your financial future, right?
Speaker:And even in your business.
Speaker:It'll help you to build that legacy.
Speaker:Maybe you started your business to build a legacy for your children
Speaker:or future generations and having a profitable business is the only
Speaker:way that you can really do that.
Speaker:Yeah, unless you're running a charity, of course, but still you have to understand
Speaker:profit even in charity because you got to figure out how to get to break even.
Speaker:Yeah, it can also help you then.
Speaker:Pursue other goals and dreams that you have.
Speaker:Your business dream may not be the only goal and dream that you have.
Speaker:And your other goals and dreams, let's say you want to, you know,
Speaker:fly around the world in 80 days or travel around the world in 80 days.
Speaker:Yeah, then you'll need resources to be able to do that and having a
Speaker:profitable sustainably profitable business can help you do that.
Speaker:Maybe you step out for three months, but you're able to bring someone in
Speaker:to help with the business in order to maintain things while you're gone as well.
Speaker:So these are what I see as the three main reasons why profit is not a bad
Speaker:word as a business owner, why you really need to pay attention to it and give
Speaker:it the attention that it deserves.
Speaker:What I see with a lot of people, especially when they're starting
Speaker:businesses, is they don't really take the time to understand profit.
Speaker:They shy away from it they tell themselves, I'm not good at the
Speaker:math, or I don't really understand the numbers, or, you know, it's
Speaker:not a sexy topic for most people.
Speaker:Most people don't get really excited about calculating profit unless you're like a
Speaker:Scrooge McDuck, right or a finance person.
Speaker:Maybe, but it is important to the overall health and success in your business.
Speaker:So all I can encourage you to do is to take a little bit of time
Speaker:to make sure that you understand profitability in your business.
Speaker:Profit is an enabler.
Speaker:Yeah, it does not make you greedy.
Speaker:It makes you smart, and it will enable you to do, like we said, build and grow
Speaker:a sustainably profitable business, help you protect and reinvest back into that
Speaker:business, and give you that financial independence and empowerment that you're
Speaker:looking for as you go on in your business.
Speaker:Now that you understand the root cause of this negative connotation that the
Speaker:word profit has and how it impacts and how important it is to your business.
Speaker:Let's talk about some of the things that you can do, that'll help you to improve
Speaker:the profitability in your business.
Speaker:I'm focused here, primarily on the things related to pricing.
Speaker:For a lot of businesses when they want to improve profits, their go-to strategy
Speaker:is to reduce costs, reduce costs.
Speaker:And that can in some businesses be effective, but you actually have more
Speaker:power to improve profit in your business when you focus on getting better prices.
Speaker:And that's why I've chosen to focus on those things today.
Speaker:Now, the first thing you want to do is you need to start adjusting your mindset
Speaker:or your attitude towards the word profit.
Speaker:So what I can recommend as a tip for you.
Speaker:Is to sit down right?
Speaker:Or say the word profit out loud a few times.
Speaker:And pay attention to what you feel, to what thoughts come to mind, tennies
Speaker:physical sensations in your body to any chatter that happens in your.
Speaker:In your head, as you say that, or write that or think that word.
Speaker:And sit with that for say a minute or two.
Speaker:And then write down all the things that came up for you.
Speaker:That will help you to identify what actually might be getting in
Speaker:the way of you shifting towards a more profit oriented mindset.
Speaker:And that alone will help you.
Speaker:For example, I may have said this before, but it bears repeating again.
Speaker:If you think, profit is the root of all evil, then when it comes to doing
Speaker:activities in your business to improve profit, you will hold yourself back.
Speaker:And that's what we're trying to start tackling with this exercise.
Speaker:Now here's three other ways that you can go about improving
Speaker:profitability in your business.
Speaker:And the first one is by drum roll, please doing the math.
Speaker:Now if you follow me, you've probably heard me say this.
Speaker:A lot and I can't emphasize it enough.
Speaker:The great news for you is I have a toolkit on my website, which will
Speaker:help you to be able to do just that.
Speaker:I'll pop that in the show notes of this episode.
Speaker:You can start to use the profit impact calculator to be able to understand
Speaker:profitability in your business and how different decisions that you
Speaker:make can impact that profitability.
Speaker:I suggest that you start there.
Speaker:That will help you to start to explore the math in your business.
Speaker:The more awareness you have about how your business decisions impact profitability.
Speaker:The better decisions you can make because you'll have more
Speaker:information to make it with.
Speaker:The second thing that you can do.
Speaker:Is clean up your act.
Speaker:A lot of times when you feel a lack of confidence or uncertainty around
Speaker:the prices that you have, you try to, let's say soften the blow for
Speaker:potential customers by offering discounts and dispatch discounts.
Speaker:Unnecessary business discounts are the fastest way to reduce
Speaker:profits in your business.
Speaker:Anytime you're offering discounts, there should always be a solid.
Speaker:Strategy or business reason behind it.
Speaker:It shouldn't just be because you feel insecure about the prices
Speaker:or how your customers will react.
Speaker:So, if you clean up your behavior in that context, then you would
Speaker:actually give fewer discounts, which would lead to better profits.
Speaker:Yeah.
Speaker:Now, I know a part of this is going to come from you, having
Speaker:prices you feel confident about.
Speaker:It's not the topic of this episode, but I do have courses that can help you
Speaker:to be able to build that confidence.
Speaker:I'll pop a link in the show notes also to my upcoming cohort of the fair
Speaker:price formula, where you can learn my price setting thought process.
Speaker:They'll give you that boost of confidence and that understanding
Speaker:of how to go about setting prices that you feel wonderful about.
Speaker:Now the last tip that I have.
Speaker:The first tip was do the math.
Speaker:The second tip was clean up your act.
Speaker:And the third tip is to focus on the value of your offer delivers.
Speaker:And there's two reasons for this.
Speaker:If you understand the value and you can develop the skills to
Speaker:communicate that effectively, you are going to feel more confident
Speaker:when you put those prices out there.
Speaker:And your confidence is going to be reflected and how your customers
Speaker:perceive what you can do for them, whether that's through your
Speaker:product or service or a software.
Speaker:It builds your confidence, but it also helps align the customer's
Speaker:perception of what they're willing to pay to the value that they're actually
Speaker:going to get out of your offer.
Speaker:And that again, can boost your profitability, which is why
Speaker:you want to focus on value.
Speaker:At all times, really, you want to focus on value.
Speaker:Often people will come to me and say, Janene, I need a list of
Speaker:arguments to argue with people when they object to my price.
Speaker:No, you don't need a list of arguments, which you need are the
Speaker:tools and the skills to be able to focus the conversation on value.
Speaker:And that is a different thing than going into defense mode.
Speaker:So focused on the value.
Speaker:What your customers value?
Speaker:So understanding what your customers value.
Speaker:Creating value for them based on what you know, they want and need.
Speaker:Creating that value in your offers and then pricing for that value and
Speaker:confidently communicating about it.
Speaker:So focus on the value.
Speaker:Ladies gentlemen, that is what I wanted to share with you.
Speaker:In this episode of Live with The Pricing, maybe all the links I've
Speaker:mentioned in this episode, we will put into the show notes for you.
Speaker:I would like to wish you a wonderful day and until next time, enjoy pricing.
Speaker:Thank you for listening to this episode of Live with The Pricing Lady, the podcast.
Speaker:If you enjoyed the episode, rate, review, and subscribe to it, then share
Speaker:it with your friends and colleagues.
Speaker:I love hearing back from you listeners.
Speaker:If you've got comments, questions, or topic ideas, go on over to thepricinglady.
Speaker:com and contact me there.
Speaker:Not sure where to start when it comes to improving pricing and profits?
Speaker:At ThePricingLady.
Speaker:com you can download a copy of my Self Assessment Pricing Scorecard.
Speaker:Find out where it's going well and where you can begin improving.
Speaker:Or just simply book a discovery call with me.
Speaker:There we can discuss what's up with pricing in your business and
Speaker:how I might be able to help you.
Speaker:Thanks once again for joining.
Speaker:Remember, pricing can hurt or help your business.
Speaker:Let's make sure it's helping you reach your dreams.
Speaker:See you next time and as always, enjoy pricing.