They say everything in life has a price. Well, in business so does the word “FREE”. It’s not apparent when you first hear it or say it but it is one of the most misused words in business I know. When people often hear it or see it used the first thing that comes to mind is “Oh I wonder what else they are selling or what kind of gimmick is this? Knowing that there is always something else. And they are right, there is always something else. So what is this something else? Now I get it, FREE is a strategy to get someone in the door or add value to the business you offer and it usually works. So what is the hidden cost you might ask?

The hidden cost is in how you and your customers see you and your business. The truth of the matter is most of us don’t value what we can get for free. We don’t, and our experience as business owners tell us this. Let’s look at how you feel as a business owner when someone asks you for something and not want to pay for it. Your services for instance? How often have you been asked to do this? It’s as if someone just asked you to drive them to Portland and back not give you any money for gas or snacks. You want to look at them like they are crazy. That’s your first thought. Your second thought, after you unclench your fist is to say WAIT, I need to eat and if I do this for free then MAYBE they will want to hire me/buy more of my services and then I will make some money!

THIS is the hidden cost. Your value has just been diminished to nothing! When you give your services away they have no value to the one receiving them. Want to know how I know! Because they will come back again and again and ask you for something else for free. Not expecting to pay a dime! That’s why you take all of the napkins you can when you go to Starbucks! You don’t care how many you take. You take as many as you can get away with so you don’t look homeless when the person standing next to looks at you with a disgusted look on their face shaking their head (knowing darn good and well they are about to do the same thing).

Think about it. You’ve put all you can into your business and now you are going to give it away or not charge enough to keep your lights on. I’ve been there. It sucks!

The next hidden cost is your customer. Yes, that’s right your customer. Do you really want to do business with someone who will take everything you can give and not pay you for it. Friends and family are bad enough, but when you add your customers to this list you’re business doesn’t stand a snowballs chance in you know where of being successful.  I had a colleague mention to me the other day that one of his clients told him that they were going to leave him and go to his competitor if he didn’t charge more. That was really cool to hear. I actually believe that most business owners should raise their prices by 10%. Why, because when we started our business we thought that was the only way to get business.  If we gave a little bit of it away all in an attempt to show how good we are.   Then we adpot the “Aww shucks I’m just a..…” you finish the sentence.

The other hidden cost is that unfortunately most small business owners (a) don’t have a marketing strategy and (b) are clueless to what or who their target market should be. That’s how we end up giving our business away for FREE! In an attempt to get more customers. Not only do we undercharge, our products and services end up infront of the wrong people so we end up selling them to the lowest bidder all the while wishing someone would come and save us from ourselves and pay us what we are worth.

The last hidden cost I’ll share is to the product or service you offer. Listen, I came from the land of FREE stuff. In the insurance industry the company reps walked in monthly with more give away’s and free stuff than I knew what to do with. I’ll be just fine if I never get another free coffee mug, pen or post-it notes for the rest of my life. I have enough to pass on to at least three generations. Go to any trade show and look at the stuff they are giving away. It’s usually not top quality stuff is it?  Now look at what you give away in the way of your in products and services. Some of us, myself included give away far too much and get way too little. And this is were I’ll end for now. FREE should be only a part of your marketing strategy ad it is not meant to last forever. As a matter of fact, there should come a time when you eliminate it from your business model entirely as far as I’m concerned. It elevates how you feel about your brand and how others view it as well. Let’s face it they don’t give you a darn thing for free when you walk into the Aston-Martin Dealership accept possibly a cool or warm beverage, stunning customer service and smooth atmosphere. The good stuff comes after the sale in the form of value added benefits of ownership and a free item or two. This is how your business should be. I’m sure you have some thoughts about this. Share them with me, I’d love to hear them.  Until next time, get out of the way of your business.  Be Well.

This is my favorite time of the year. Football has just ended, the golf season in firing up, usually the NBA is in full swing and March Madness is in the air. I guess you can say, I’m a sports nut (oh, I forgot soccer). So how does this relate to business you might ask? Well, I love the game of business and there are those who say business is a sport. Heck, we dedicate so many sports analogies to it we might as well call it what it is. A full contact sport. So, my ears always perk up when I hear people talk about how business is difficult and why they can’t figure it out and why they must do certain things in certain way. While there may be some truth to this, I think some of this comes from our own blind spots as technicians of our own businesses. Running a business can be difficult for some because we often get so caught up in building a better mouse trap that we don’t often want to pay attention to the things we must do as business owners that make our business run well. Herein lies the secret. There is a game within the game of your business. Me, I love the game of business. I love everything about it. To me it is a game and there comes a time where you have to think like a business owner and then act like one. Like planing for your business, defining who your target market is and watching your numbers. These are just a few of the things that make you think and act like a business owner.

Like in sports there are games within the games. If you are a student of your sport, you know that each postion on the field or court needs to have certain skills prefected in order to play the game effectively. Then as each position is played well the team begins to play well and in synch and things begin to move in their intended direction, victory. However this is where most of us fall short and look to our widget as not being good enough, fast enough or big enough. While this might be the case, don’t ignore who your product gets infront of and how it gets there.

Here are a few things I recommend you do if you want to develop a business mindset and begin acting like a business owner.  Go back and read your business and marketing plans if your have them. If not I beg of you to write one, even if it is on a napkin. These can make all of the difference. Even if you just write down your ideas and thoughts about what you intend for your business this can be powerful enough for you to see in writing what you envision for your business and the things you must do next to drive your business effectively. Think of this as your playbook for your business. You get to see how each thing you do should look when it’s being perfectly executed on paper. Continue reading “The Game Within The Game: Get Serious About Your Business Already!” »