I’m a big fan of CAPACITY BASED PRICING!
Robin Waite
Business Coach ?? Podcast Guest ?? Keynote Speaker ?? Bestselling Author of Online Business Startup and Take Your Shot - Ask me for a free copy of Take Your Shot. Group and 1-2-1 Coaching. Breakthrough Sessions
During a study, and while reading a book called The Goal by Eliyahu Goldratt, I discovered the ideal “capacity” to work at is 72% - the rationale is that for every 1% over 50% it’s actually worth 2% of your capacity because it moves you closer to being full and doesn’t allow for emergencies or problems.
So, 72% is actually more like being 94% full (i.e. 50% + 22% + 22%).
When you operate at 72% it means you have capacity to infill appointments which stimulates cash flow.
Since I discovered this I’ve started encouraging my clients to REDUCE their capacity down to 72% which has INCREASED their profitability with far fewer problems.
We do this at the same time as a fairly significant price increase (like this post if you’ve already put your prices UP) of at least 30%.
Plus we are also looking for more committed clients, ones who are happy to commit to payment plans, subscriptions and memberships.
The results are quite remarkable.
Who would not want a business which produces double the net profit but with half the number of required clients, right?
Yes, you read that right:
Double the net profit with half the clients.
Who here is working to full capacity but not achieving their full earnings potential*?
Pop you answer in the COMMENTS below.
Stay Fearless!
- Robin
P.S. - * swap out the word "potential" for "dream income"!!!