The problem is that we often pay little attention to our pricing when satisfying these requests for additional services. The best companies that we work with feel no embarrassment and have no problems with charging for everything, using the old adage ‘you can have anything you want as long as you pay for it’. However, it is amazing how many things are given away unnecessarily in business. We recently worked with a company in the Paper industry who identified 75 additional products or services that they provide to customers free of charge. Their list included the following:

• Storage of products for delivery as and when the customer wants it.
• Special or rushed deliveries to additional locations.
• Bespoke packaging personalised with the customer’s name/logo.
• Design work on new products.
• Large quantities of samples and mock-up designs.
• Frequent service callouts for their engineers.
• Changes to orders and cancellations at short notice.
• Frequent product specification changes.
• Products having to be fully recyclable.
• Extended payment terms.
• Marketing support to help the customer’s sales process
• Management information and other data.
• Training and technical assistance.

Do some of these points sound familiar?

Many companies have now realised that to maximise profits, they cannot afford to give things away every time the customer asks. We don’t have to give things away just because our competitors do. The problem is that it is much easier to give things away than to take them back. Try getting a customer who has paid you on 90 days terms for the last three years to agree to move back to your standard 30 day payment terms. Obviously, the simple rule of charging for everything is the ideal. In the real world, however, you will find that nearly every department in your business is giving things away that could be charged for.

You need to ask yourself these three key questions:

• What additional services do we currently provide to our customers without charge? (you may wish to brainstorm this with colleagues from other Departments to come up with a master list).
• Which of these items could we realistically now charge for without losing customers or business?
• Now pick the best five and estimate how much additional profit you will make from charging for them?

The trick now is to turn theory into action by charging for these five services from tomorrow!

NB – Don’t forget – since you already provide these services for these services for free anything you now charge for will be pure profit as y