Before you can price strategically, you need to manage smartly
Sometimes you just need revenue. You look around: You're not busy, assets are idle, and bills need to be paid, so you sell the next project at a deep discount assuming that your costs will be low.
Wow, it was easier to sell when you low-balled that proposal. You find good reasons to discount the next job and close that deal too.
Then that BIG job comes along. It's a month's worth of revenue in one week. You convince yourself that you are just being competitive and lower your price. Hey! You won!
Then you realize that BIG job's costs are higher than your usual projects. The deposit money evaporates quickly.
You need more cash.
No worries. Your new pricing strategy will bring in more easy wins. After all, these jobs are profitable - just not as profitable as before.
Then all of a sudden, there's no cash left and receivables barely cover overhead.
You just need another BIG job. You see where this is going, don't you?
We call this vicious cycle The Death Spiral and it will quickly and quietly ruin your business even as you seem to be growing.
There's a solution.
Register for this month's webinar to learn how to reconnect the fundamental business concepts of cost, price, and profit.