Pricing - interesting story

Newrean

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I think that most of us at some time worry about our prices. Are we charging enough? Will we lose clients if we raise our rates? Can clients afford our rates? etc etc

Below is a true story about pricing.

When a colleague was learning hot stone massage as part of her homework she had to check out therapists in her area who were offering hot stone massage too. She foun someone who was was charging £90 ($180) for a hot stone massage which is quite expensive. She got in contact with the therapist and told her she was learning hot stone massage. The therapist then admitted to her that she hated doing hot stone massages and didn't really know what she was doing. By charging such a high price she assumed it would put clients off but it had the opposite effect and she was always fully booked. In the end she referred her clients to my colleague.
 


I love this story!

Signs just appeared in the Castro advertising "$40 MASSAGE"—that's all it said, with pull tabs with contact info. The economy is really weirding things out!
 


There's a very centrally located tiny spa that's been open for about a year now. They charge $40 per hour, regardless of modality, including hot stones.

Just to put that in perspective, beach massage here is $60 per hour, which is what I charge at my studio. Hotel spas are higher. I just learned that this mini-spa has a local rate is 250 pesos per hour, which at today's rate of exchange (one dollar now equals 14.85 pesos) is about $17 per hour. Local rates are generally extended to people who live here.

My local rates were $35 for Swedish, Deep Tissue or Reiki, $45 for Ashiatsu. For years my clients were accustomed to paying 350/450 pesos, since the peso was at 10-11 per dollar. At the current rate of exchange, that becomes 520/670 pesos, which in my clients' minds, because they are still thinking 10:1, is $52/$67, which is way too expensive for many of them.

So I'm in a bind here. After much reflection, I've decided to offer my local rate in pesos, regardless of the rate of exchange. It will be 450 pesos for work by hand and 600 pesos for work by foot. At today's rate, that works out to about $30/$40. It's still a good bit higher than most therapists' local rates, but some of my expenses are in dollars, like massage cream, oil, plane tickets, etc, so I still think in dollars. Fortunately my rent is in pesos, so my coteforum.xxxe now runs me about $200 per month. It doubles as my home and my massage space.

I really can't complain...
 


Those $40/hr massage flyers are up here in the Richmond District too!
 
Pricing in a recession

In a terrible recession like this, all businesses face the pressure to lower their prices, and there's more and more companies deciding this is their way to stay solvent. Cheap massages are more prevelent in my area, and it's no doubt an answer to less bookings. It's a fine line, and the downward price pressure is stronger than ever. Hopefully things get better, there are some positive signs.
 


I agree there are positive signs. I've had an upswing in business, and my clients who work with small businesses say their clients are getting bank loans and expanding again. Perhaps small businesses are the first ones to be recovering! :-)

Ok, that's my Think Positive spiel for the week ;-)
 


Adding my "positive spiel", I'm currently running neck-in-neck income-wise with last year. I have not lowered my prices. :D
 


jdcan said:
Adding my "postive spiel", I'm currently running neck-in-neck income-wise with last year. I have not lowered my prices. :D

I'm ahead! :shock: :grin: Congratulations to you, too, jdcan!!
 


My January and February were lower than last year, but just having had my best March EVER, I am almost caught up!
 
Pricing - interesting story

One thing I have done is my prices are $55...I put a sign up on the back of my massage door that says reserve your next one hour massage session and receive your next massage for only $45 it exploded on me!!! Everyone is signing up I did a special during the month of April for $45 then when they seen the sign they just keep re booking....I think I might have bit off more than I could chew with this one but I am so happy I did it! I am now looking at hiring another therapist to help me out. I make up the difference in tips which has worked out so well!!!
 


EgoMagickian said:
I love this story!

Signs just appeared in the Castro advertising "$40 MASSAGE"—that's all it said, with pull tabs with contact info. The economy is really weirding things out!

That's what I charge! *laughing* But then I live in country-ville where the average annual income is actually less than minimum wage. Like 17k per year. Crazy. $40 is to Southeast Oklahoma what $100+ is to So. Calif. :-P

Angela
 
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