In the last post I talked about what blocks people from doing their marketing. The fear that comes up over and over is this:

If I do my marketing regularly and well, I’ll attract too much business, and end up working seven days a week. My service level will drop off, everyone will get mad at me, I’ll lose a bunch of customers and be back where I started, except worse off because a lot of people will be mad who weren’t mad before.

Three Alternatives

Of course there is another alternative to this scenario. Three, actually. Raise prices, start a waiting list, or hire people to help. This week we’re going to talk about raising prices.

This option frequently scares people. It’s also not right for everyone. There are scenarios where you can’t raise your prices; and perhaps even if you could, you wouldn’t want to. That’s up to you to decide; but before you reject this idea out of hand, read on.

Raising Prices

If you absolutely love doing the primary work of your business and you don’t want to delegate any of that to someone else, and you don’t want to supervise employees, raising your prices is a good option.

How Do I Do It?

Here’s what to do. First, delegate everything you don’t enjoy or aren’t good at (bookkeeping and administrative work being two possible candidates). You can hire other companies or other solo entrepreneurs to do this work for you so you don’t have to directly employ anyone. Independent bookkeepers, virtual assistants, organizers, and lots of other kinds of administrative support people abound. Talk to your business friends about who they use and take the plunge. This should begin to free up some of your time.

If You Are The Spiritual Type

Next, if you are the spiritual type, read this blog post by Mark Silver about setting prices using your heart.

If this idea makes you scoff or cringe, read this blog post anyway. It contains some very practical advice about how to price.

If Your Are the Analytical Type

If you can’t stomach the spiritual approach, research your competition on line, even risking calling some people in your same business outside your competitive area and asking them what they charge.

Now Do It

Then raise your prices. Don’t go crazy, obviously, but I’m guessing that in your research, or in doing Mark’s method, you found that your prices were too low in the first place. Some customers may leave, but you’ll have less business at a higher price, which should give you some breathing room.

By the way, this is the law of supply and demand. Things in greater demand (non-stop plane flights, homes in good school districts) cost more. For some reason, we think this law doesn’t apply to us in small business. But it does. If you are great at what you do, your perfect clients want what you do, and you are communicating to them regularly about how you can help them, you’ll earn more business than you can handle. The demand will exceed the supply. One way you can respond to this is by raising your prices.

Got comments? Post them here.

My life has changed profoundly in the last month. I moved my home and office, which together put me at the DefCon Five level of stress–right under graduating from college without a job in the middle of a deep recession.

This amount of change, even if it’s all good, produces intense disorientation in the brain. There’s a physiological reason for this feeling.

When you do anything repeatedly, your brain cells physically line up to facilitate doing that thing. The cells make it easier and faster for you to do it. This is true if whether you’re setting aside 90 minutes every morning to do your marketing activities or shooting heroin. Your brain doesn’t care. (Well, it probably cares right before you die of an overdose, if you’ve decided to make using heroin the habit that your brain is facilitating for you.) But in general, it doesn’t care. Your brain cells’ job is to make the things you do over and over, easier to do each time.

Why the brain rebels

Addiction and Grace by Gerald May offers a detailed and fascinating explanation of brain physiology and changes that result from giving up an addiction. Few changes are more radical than kicking drugs, alcohol, gambling, etc.

When you stop doing something you’ve done for a long time, your brain rebels. It sends SOS alerts like, “Hey, this is wrong. What are you doing? Where are we? Why did you do that? We haven’t done that before. This feels weird.”

Your brain rebels even when the change you’ve made is positive. In my case, the changes are positive. And yet I still carry this vague sense of unease, as if something’s wrong and I’m not sure what.

What does this mean for business?

When you change something, especially something big, such as marketing program or a product line, even if all evidence says the change is beneficial, you’ll still feel a sense of unease. This is your brain on change.

For people who rely on their intuition, the vague sense of unease can mislead you into thinking you’ve made the wrong change, when all you’re experiencing is change malaise.

There is enough fear and resistance to go around already. Knowing a bit about the workings of your brain can help you weather some of the feelings that arise when you make changes. We have to make changes in our businesses all the time or the market leaves us behind. At least now you know why your brain objects to change, even when it’s great for you and your customers.

The solution is patience

As so many other problems in life, the solution to fear and unease is patience. Practice your new change as much as you can, so you can retrain your brain cells as fast as possible. Be patient with your poor old brain. Remember, she’s had the rug pulled out from under her.

Have you weathered any big (or small) changes lately, that have rocked your world, or at least given you a vague sense of unease, even if the change is good? Leave a comment below.

Pricing, especially for people who set the price for the product or service, and deliver the product or perform the service, can be very tricky. It’s easy to confuse the price you need to charge for what you make or do, with your self esteem.

You can combat this two ways:

1. Research what your competition sells their work for

2. Figure out how much value you deliver, and set your price at some fraction of that value.

Research is pretty easy to do: the internet is an unlimited source of pricing information; and even in the unlikely event that you can’t find an exact price for what you do, you can pick up the phone and call someone outside your area and ask what they charge for a similar product or service.

If you do this research, you’ll find that there is a huge range of prices for almost every product or service sold. People who go to the local barber shop and pay $11.00 (plus tip) for a haircut may be flabbergasted (or horrified) to know that you can pay $400 for a man’s haircut (and even higher for a woman’s cut). In my field, you can pay a coach $25 an hour, or $5,000, depending on who you hire.

Why would someone pay $400 for a haircut? Why would someone hire a coach for $5,000 an hour? Because they feel like they receive much more value than the cost they incur. Perhaps the $400 hair cut makes you look a lot better on TV, hiking your ratings and securing your contract for the next five years. Maybe the $5,000 coach showed you how to break through a barrier that had been blocking you forever, enabling you to triple your income.

Farfetched? The $400 haircut and the $5,000 per hour coach both exist. More than one person is willing to pay for these rates for that kind of value.

If you haven’t raised your prices recently, or if you simply want to expand your mind on the subject, read these blog posts.

www.fluentself.com/blog/biggification/the-art-and-science-of-pricing/

www.fluentself.com/blog/biggification/coming-up-with-prices/

http://www.shaboominc.com/blog/ (read the November 20th post called “Does Your Pricing Prevent Customers from Committing?”

Do you need to raise your prices? Are you afraid? What’s next for you?

Perhaps I’ve been hanging out in Northern California too much (the land of the woo woo), but I think I actually had some psychic influence over the fact that it took six rounds and 45 days to get an error-free proof of my book from the printer (a process that should have taken two weeks, max).

I was really afraid for the book to come out. I wanted the people who bought it to use it, and to receive tangible benefit from it. Specifically, I wanted them to earn more money by working through the exercises in the book.

As any reader of the Aesop Fables (or your mother) can tell you—you can lead a horse to water, but you can’t make him drink. In other words, I can’t guarantee anything. Even if 100,000 people bought the book (which would be very cool), I couldn’t guarantee that one of them would read it, or do the work, or earn more money in their businesses as a result.

I can only provide the water. You have to do the drinking.

I experienced a raft of pain while working in some of my previous businesses, mostly centered around not earning enough money. It was awful. I want to save the rest of the world from experiencing that level of agony. That’s why I was so worried about my book coming out.  What if my book doesn’t save all the other people in the world feeling the same pain about their work?

Coincidentally, my raft of pain happened to be the perfect amount, at the perfect time, to get me to change; to sell my IT business and to go into coaching and writing. If there had been less pain, I might still be talking to people about computer network support.

Pain was (and is) my friend.

And although I hope my book does alleviate a lot of pain for all of you out there who are passionate about your work and your businesses, but aren’t earning enough money, the truth is, you might need to be in the pain you’re in to motivate you to change.

And if you are ready to change, you have to do the drinking. It’s up to you. Not me.

I did my part to provide part of the water for all you thirsty small business owners. The rest is your responsibility.

Here’s my question to you: are you standing at the water, but not drinking? Go to your favorite coffee shop and set aside 15 minutes to look around at your life. Are you in pain about something that has a solution? Has someone or something lead you to the water? Are you standing in it up to your knees, or armpits?

What can you do to go ahead and drink?

The real reason she’s afraid, (in my opinion, anyway), is that this is the perfect thing for her to be doing right now. And she knows it.

I see this in coaching all the time. The closer people get to the thing they want to do the most, the more fear comes up. In fact, it’s a great barometer. If you’re really afraid, it’s the equivalent of the universe shouting “You’re Getting Warmer…Warmer…Hotter!” (Unless someone has a gun to your head, which is a different kind of fear that we aren’t discussing here).

I’m feeling it too. My book suddenly went from looking like a cute Word document, to looking like a real book. Holy !$@##@%!! (I’m getting warmer…warmer…).

How about this for an antidote: Fear is excitement, without breath.

“I have a friend with a heart problem (the physical kind). She needs to have a procedure done to fix it, but has not been willing to do it. Like all “procedures,” behind this word is pain, a stay in the hospital, anesthesia, and the (small but always present) risk of death. The risk of death is higher if she doesn’t get the procedure done, but it’s hard to remember that part when you’re not dead right now, and you are contemplating the hospital stay with all its accompanying pain, lack of sleep, and other uncomfortable features.

My friend’s cardiologist has told her for the past year that she needs to have this procedure done. This doctor is kind, gentle, knowledgeable and trustworthy.

Yesterday, I witnessed a different cardiologist tell my friend the same thing. This cardiologist was abrupt, harsh, and when my friend started to argue with him, held up his hand and said, “I don’t want to hear it. My job is to tell you the risks. I don’t take it personally if you don’t take my advice. I just want you to know the facts.”

At first I thought “what a jerk.” But then I started to think about my friend and her heart and what’s best for her. The second cardiologist (the first one too, just not as harshly), had my friend’s welfare and the truth of the situation uppermost in his mind. He might have presented it more kindly, but to him, the information trumped the delivery.

It got me thinking. Where am I mincing words? Am I doing that with any of my clients? Would a truthful conversation with someone, without worrying what they thought of me as I delivered the message, help the person, or the business, immeasurably?

Is there a conversation you need to have? Does one of your clients need to take an action (or even buy something from you) that is in her best interest, but she is resisting? The key to this is having the person’s welfare as your top priority, without being attached to the outcome. Deliver the message, let go of whether the person hears, or heeds it.”

So that’s the article. I got at least ten replies from people who took the advice to heart and had their difficult conversations, every one with unexpectedly good results.

People said things like: “Happens to be just what I needed to hear…”
“Your words inspired me to get in a quiet space and think about the conversation I was going to have that brought me some fear.”
“I did it!”

The moral of the story, at least today, is that even though I do want to provide helpful business information, sometimes the best information for us small business owners is the stuff that addresses the human side, the relationship side of business.

I used to think these subjects were taboo, as if I’m supposed to leave my personality (and all its foibles, shortcomings and quirks) at the door. Judging from the response to my newsletter, I was wrong.

But there are always people in every economy who make money.  There was an article  in the NY Times 2 weeks ago called “When Fear Takes Over Our Brains,” written by a neuroscientist, Dr. Gregory Burns, talking about what to do instead of letting fear take over. 

Dr. Burns says that when fear is active in the brain, exploratory activity and risk-taking are turned off.  Turned off!  I don’t want to walk around in a fog of fear, the risk-taking part of my brain paralyzed, and not even notice it.

He says the antidote to that is to stay away from fear-mongering people, and don’t monger fear yourself.  And after I do that, he advises me to innovate.  Find new opportunities.  Figure out new things to do in my business.  He says “…right now there are incredible opportunities to do something differently.  Yes, they’re risky, and some will fail.  But while others wait for the storm to pass, I’m busy expanding into new areas.”

I want to be one of those business people who make money in any economy.  Even more, I want to keep innovating.  Focusing on innovation is so much more fun, challenging, and such a better use of my time than sitting around watching the stock market plunge.  Blogging and Twitter are new for me.  Writing another book.  I know there’s much more I can do.