In an age of competition from high street card chains offering impossibly low prices and YouTube tutorials convincing the well-meaning Joe Bloggs that he can become Jack of all trades, as an experienced balloon and party artist it can feel like a real challenge to hold your ground and price your work at what it’s worth. Add to that keyboard warriors who feel no shame at scoffing at your special offers and suddenly upselling your services can feel really rather deflating BUT despair no more! This BAPIA News post explains how and why you should stand your ground when it comes to protecting your prices.
If you’ve ever replied to a potential customer’s price enquiry only to be told, ‘That’s extortionate!’ then you’re not alone. Worst still, is the joy you feel swell inside when a customer sends you an image of an ornate, 10 ft balloon arch and says, ‘I’m after something like this please!’ only for that same swelling to sink to the pit of your stomach when they follow up with, ‘What can you do for £25?’. Have you ever wondered if these people have the same approach when they go out for dinner? ‘Well, since it only took the chef at The Ivy thirty minutes to whip up the duck confit, shouldn’t they only charge for half an hour of labour plus the cost price of the ingredients?’. Of course not.
When a restaurant prices the markup on their meals, they’re considering various factors; there’s the ingredients, yes, but there’s also the training that chef did which makes their hourly salary higher, the business overheads, the marketing that went into bringing those customers through the door... The same applies for your balloon and party business. Your customers are paying for everything that went into bringing them their beautiful balloon design. That’s the raw materials and your time, yes, but not just the time involved in that one job; the time you have invested over the years in all of your training and experience. The classes, the webinars, the process of trial and improvement from job to job. Plus, there’s the marketing materials and other business overheads down to the petrol and driving times it takes to get to them (if you do deliveries).
Remember to sit down and work all of this out when you are creating your pricing structure. Of course some of these are one-off costs and certain aspects will vary from job to job, so it’s important to average out these expenses and then use that as a baseline on top of job materials and time taken. Done that? Ok, so now you’ve broken even. It’s time to make a profit.
Ready to move on? Click here to read the next part of the 'The Price IS Right' series, Part Two: Pricing for Profit.