You can, of course, price your products and services above the average price in your industry. Auto dealers sell cars with prestigious names and designs for double or more than the price of an average car. They have created a higher perceived value in which the buying public believes. But disassemble all the parts in a highpriced car and spread them out on the ground. Where’s the value now? Sure, some of the parts may be better quality than what you’ll find in the lower-priced car, but they probably don’t really cost double. Only when you see the finished product do you associate the higher value. Some people want the higher-priced model just because it is the higher-priced model.
If you’re going to be the high-priced brand in a small business, you must create a higher perceived value for your company. Why is your product or service worth more? List your reasons and then sell them to your customers. Maybe it’s your experience, your guarantee, your unique style, or just your professionalism. Whatever the reason, you need to sell it.
You will probably appeal to a smaller market and have fewer customers, but your profit margin will be higher. If you can find a niche market, and it becomes popular, you can likely demand a high price. But always be aware of competitors who will see your profit level and want a part of it. The longer you can hold your higher-profit niche market, the harder it will be for your competition to break in. So, before you take the high-price plunge, have a plan to hold your customers as long as you can.
Above all, don’t take a common item that can be found anywhere and price it high. This will turn off customers, and you’ll lose most of them. If you’re going to price high, it needs to be to fulfill a need or desire that people can’t get filled elsewhere.