There are not many things I regret more than when I undercharged on a job just before the holidays. I dropped a price at the last second, giving the client a silent discount that they neither asked for nor would appreciate. What’s more, I also blew the chance of Christmas bonuses for the people that were working for me, or myself.
That happened a long time ago, with my first company, which gave me a lot of time to think about the psychological costs of pricing too low.
After the adrenaline of the sale wears off, what’s left is the frustration at having underpriced the offer. It can also re-surface when we are faced with the value the client got or industry standards.
– The resentfulness of knowing we could have missed our chance to upsell or charge more. Usually, this happens when clients express their surprise at the low cost.
– The pain of having the client flee from the “suspiciously cheap” offer you presented._
It happened to me a lot when I first started to sell globally._
– The aggravation of the long-term impact of staying underpriced. Setting a low price early can anchor us in clients’ eyes, and make it difficult to raise prices even when exhaustion sets in.
About the only good thing a low price can do is to “light a fire” and motivate us to jump over psychological hurdles. So if you feel the pain – use it to jump the hurdle of fear and you will land in a better place.