While important, the price we ask for a product or service is far less important than you might think. Our customers want value. They are paying for solutions. They expect results and they are not put out by paying a fair price to get what they need.

Why is it that so many salespeople and business owners are too quick to discount their products and services in order to make the sale? Where is it written that the customer is entitled to a discount? What are the rules and who wrote them anyway? The fact of the matter is that we are often so intimidated by our prospects and become desperate for those precious sales that we become willing to almost give them away. That tactic must end now if your long-range business plan is to survive and thrive.

While important, the price we ask for a product or service is far less important than you might think. Our customers want value. They are paying for solutions. They expect results and they are not put out by paying a fair price to get what they need. We entrepreneurs are often guilty of lowering our prices out of a sense of fear or competition. We need to be in the practice of adding so much value that the customer does not even blink at our price. We must learn to present our expected price with confidence, without flinching.

Seth Godin has talked about how to make a million dollars. He contrasts several philosophies that essentially attain the same net result using different sales approaches. While selling a million dollars worth of products and services would delight most entrepreneurs, discounting their prices and sacrificing profit may prove disastrous at the end of the day. Many Asian conglomerates operate on paper-thin margins of approximately one percent and expect to gain market significant share as a result. They favor the "make a penny from a million different customers approach." This reasoning seldom works in the long run. It's far better to maintain a base of a moderate number of customers, each contributing several  profitable sales.

Discounting is expensive and seldom necessary. In fact, many customers are more suspicious of an extra low price than they would be of a sky-high one. Customer perception is a key component and must be an important consideration in your pricing strategy. Imagine two hair salons at opposite sides of the street. One is a discounted, basic, no frills shop and the other is full-priced, offering an experience rather than simply a haircut. While each will get their share of customers, the full-service salon will likely draw more revenue and generate far greater profits.

Likewise, you want your business to offer an experience that customers are willing to pay for. They will pay, and they will not question your prices as long as you deliver more value than they expect, giving them plenty of reasons to return time and time again, and share their experience with others.