So you’ve set up all your products and your pricing for labour in your quoting software and all your staff are quoting consistently. Great! – but what happens when you have to deviate from this price? Enter price tiers.
A one-off change is easy to manage by the project manager, but price tiers can help you make sure that your team is consistently quoting a special rate for set customers. This article will explore the different ways you can use price tiers and how to set them up.
How do price tiers work?
With price tiers, you can assign multiple prices for different customers. Once you’ve created your price tier you can add multiple prices to of any product and it will automatically apply to customers in that tier. For example, if the default price is “$900”, you can set the new price tier called “Member Pricing” and reduce the price to “$500”. This special rate will only apply to any clients that you add to the “Member Pricing” tier.
Here are some ways that you can use this:
To honour a negotiated rate
Not all clients come to your business accepting the default rate. Some clients may negotiate the rate down because they are planning to buy frequently, or perhaps you propose a special rate to win a contract. Whatever the reason, you want to make sure that you’re meeting your contractual obligations.
With a price tier set-up, every quote and invoice created for that client will automatically use the special rate when needed. It helps you to negotiate better and more freely without worrying about it getting complex for your team. You don’t need to worry about making sure that everyone who might engage with the client to know the rate they get.
Bring consistency to varied pricing
Different customer segments are likely to be more or less price-sensitive based on a huge number of factors. Price tiers enable you to be responsive to this without wildly varying the price you offer job-to-job or client-to-client. You can set up a special rate for particular industries or groups such as “End User Customer” or “Wholesaler” that can help you be more competitive while still ensuring that you are profitable and strategic.
Save your team time when quoting
Price tiers can help remove a lot of doubt in the quoting process for your team if you empower them to change prices for clients. One of the common problems with varying prices is trying to keep it consistent from the customer’s point of view. If a client engages your business for a service that you charge $X for, they will expect the same price when they come back.
Without consistent price tiers, your team may have to trawl through previous quotes to see if that client has ever bought that product and what rate they will expect. Put a price tier in place for this client’s segment and clearly show on your quotes when they are getting a “one-off” discount and you’ll save your team time on every quote for a new client.
Reward loyalty with discount rates
Have you ever wanted to reward your clients for loyalty but don’t know how to implement it? If you have ever been part of a membership group like RACQ you’ll know that loyalty and years of membership can be rewarded with discounts or special services.
You can set up price tiers to segment your customers based on how long they have been with your company or how much they have spent. Once they have met the criteria, you can change their price tier and give them access to lower pricing.
Book in your free information session on Price Tiers today
Learn how price tiers work and how they can help with your business with an obligation-free training session. Book in a time today.