Pricing Without Apologising

Price is the business decision most people make with their gut, not their head. You look at the number, feel uncomfortable, and drop it "just a little" — and that little is usually exactly your margin.

The uncomfortable truth: low prices aren't kindness to the customer. Low prices build a fragile business that needs huge volume, attracts rushed buyers, and leaves no money to deliver well. Charging too little is the fastest way to give worse service.

Price isn't cost plus margin

Three ways to price, in increasing order of health:

1. Cost-based — add up what you spend and add a margin. Simple and limiting: your price is tied to your structure, not the value created.
2. Market-based — copy what others charge. Comfortable and dangerous: you enter a race where the only differentiator left is being cheaper.
3. Value-based — the price reflects the result the customer gets. It's the only route that allows margin and quality at once.

Value pricing requires knowing what the solved problem is worth. If your consulting stops a company losing $1,600 a month, charging $300 isn't generosity: it's a sign you never measured the impact.

How to calculate from value

A simple, defensible method:

1. Estimate the annual gain or saving your work creates. Use the client's number, not yours.
2. Add the cost of doing nothing (ongoing losses, wasted time, rework).
3. Ask for 10% to 20% of that value in the first cycle.
4. Sanity-check the result against the market — not identical, coherent.
5. Test with three clients before changing everything.

Example: an abandoned-cart recovery system returns $12,000/year to a store. A project price between $1,200 and $2,400 is defensible — and easier to sell than $400, because $400 suggests the result is small.

Mini-case: the developer who raised prices 60% and lost two clients (on purpose)

Bruno charged $900 for a business website. He juggled seven clients at once, always late, always renegotiating scope. He made three changes in one month:

• Raised the price to $1,450 and included SEO structure and the first lead-capture campaign.
• Started presenting the price next to the expected return ("one new client a month pays for the project in six").
• Created a smaller step: a $180 diagnostic credited against the project.

Over the next 60 days, two prospects declined — the same two who always pushed for discounts. He closed four projects at the new price. He earned more serving fewer people, and for the first time delivered on time, because he had room to do the work properly.

Losing customers who buy on price isn't a loss. It's the filter working.

How to present price without apologizing

The price moment has simple, almost mechanical rules:

• Say the number and stop talking. Don't fill the silence with justifications; justifying signals doubt.
• Never apologize ("it's a bit expensive, but…"). If you think it's expensive, they will too.
• Anchor first. Present the cost of the current problem before your price.
• Offer options, not discounts. Three tiers (essential, complete, supported) shift the conversation from "yes or no" to "which one".
• If they ask for a discount, remove scope. A lower price for the same scope teaches the buyer your first number was invented.

When to raise prices

Clear signals you're overdue:

• You win more than 70% of the proposals you send.
• Nobody questions the price.
• Your calendar is full more than six weeks out.
• You habitually deliver more than you sold.
• Your results today are better than when you set the price.

Rule of thumb: raise 15-25% on your next three new quotes, keeping current clients at the old price for one cycle. If everyone still says yes, raise again.

Checklist before setting your next price

1. Do I know, in money, what the problem I solve is worth?
2. Does my price allow quality delivery and still leave margin?
3. Do I have three tiers instead of a single number?
4. Do I have a cheap but paid entry step?
5. Do I have value arguments ready, with numbers?
6. Do I know exactly what I'll remove if asked for a discount?
7. Can I say the price out loud without my voice changing?

That last item sounds silly and is the most revealing of all.

Expensive mistakes

• Charging hourly when value has nothing to do with time spent.
• Discounting before the customer even asks.
• A different price for every client, with no criteria.
• Competing with people charging a third, instead of changing audience.
• Never adjusting — inflation and your experience grow, the price doesn't.

Exercise for this lesson

Take your main offer and do three things today:

1. Calculate the annual value it creates for a typical client. Write the number down.
2. Set a price between 10% and 20% of that value.
3. Write the three sentences you'll say when presenting that price — including the one you'll use if they ask for a discount.

Then rehearse out loud five times. Price is defended with calm, and calm comes from repetition, not courage.