What Do You Sell? And Why?

"We sell time" is not just bad pricing strategy; it's a flawed business model.  If it was true, you'd be paid for just turning up.  What you sell is the value of the results of the effort you put in during that time, and this value won't have any general, 'one size fits all' mathematical equation relationship to time, let alone be in direct proportion to it.

A business exists to make profit for its customers, to create results and value outside of itself.  The concept of 'profit centre' is flawed, as admitted by the man who coined the term, the late Peter Drucker.

Despite having other faults, even Adam Smith recognised that both purchaser and seller need to gain - to make a profit - from a transaction.

“The only purpose of a business is to create a customer”

In consequence, the default purpose of Marketing is not to increase revenue - It is to increase profits!

Peter Drucker went on to draw this to its logical conclusion when he said, "The only purpose of a business is to create a customer.  A business has only two functions - Marketing and innovation.  All else is cost."

The simplest way for your Marketing function to increase profit is to concentrate on customers who will derive greater value from their purchases and who are therefore more willing and more able to pay more.  Utilising the innovative juices of the entire organisation to create and deliver more appealing products, services, payment plans and the rest for this section of your market is an excellent use of your resources.  The way I have often put it to my clients is, "Look for bigger problems."

If you agree with these thoughts and would like to find out more about structuring your business in a better way, selling properly, how to make sales without selling and get paid what you're worth,, visit www.sws3.co.uk to download 30 more free practical ideas you can implement straight away in your business.

Service providers who charge for their time or their materials, or whose prices are influenced by their competitors can find out how to get paid what they're really worth at www.sws3.co.uk