Strategies for pricing as inflation looms
How can a small business raise prices when demand is already weak?
Paul Markow, left, stands with his mother, Bea Markow, on Wednesday, April 27, 2011, in Phoenix. Colormark Custom Photo Lab began as a small business and expanded in the late 1960s, but the shop recently closed.
Tim Hacker / East Valley Tribune / AP
I wrote in a post yesterday about the growing trend found in the latest NFIB survey of small business owners increasing prices in the face of increasing inflation in the economy.
A common question I get asked is just how to go about raising prices, especially given the weak demand as the recession lingers.
Barbara Findlay Schenck offers some very specific tips in an article at Business on Main, which are well worth a read. Whatever steps you take to increase pricing, Findlay offers this advice:
As you announce new prices, understand and be prepared to define the reason behind increases -- but don't apologize. Keep your focus on the high value you're delivering, the unique quality you provide and the options available to ease your customers' purchase decisions.
Remember that customer service is the competitive advantage that most small businesses have over their larger competitors. Never lose sight of the importance of this as you move toward increasing prices to offset inflation.
I will be writing a post on this topic early next week.
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