To handle this, we need to get a more objective evaluation of worth of our product or service. First, we must come to terms with our own worth, through our own inner work with or without help of friends, therapists, etc. Then we need to do market research. We must know what competitors are charging. This doesn’t mean we charge what they charge, but we need to think through reasons to charge less, same or more. Any of these may be effective and profitable, depending on our business.

Equity & social justice

Another reason we might underprice is that we want to have our service and products available to a wide spectrum of people, not just those with higher incomes. This comes from valuable ideals of social justice. Instead of lowering our prices across board, perhaps to point of inadequate profits, we can offer unadvertised discounts or sliding scale prices, when appropriate. Another approach is, in our marketing materials, to invite prospective customers to inquire about opportunities for low-income people. If we offer too much at low prices or pro bono, we may end up out of business. Then we can’t help anyone!

Sell on value, not price

The key benefit of our product or service should not be having a low price or lowest price. This turns our product or service into a commodity (as in Vlasic pickle story), which is something to be avoided at all costs, no pun intended. We will do best to sell on value. Lowering our prices may result in competitors lowering theirs, so we gain nothing and actually lose. As Bill Caskey wrote in Same Game, New Rules, “The real question is not "what's price?" although that is what prospect asks. It's really, 'Is there value in changing from my current situation without this product?' ”

Cash flow

Sometimes we need cash quick, and lowering prices can accomplish that. However for long-term profitability, we may need a higher price. Remember, our product or service helps people solve their problems. The good news is that there are plenty of problems to be solved. So if some potential customers find our prices too high and we have fully explained value they’ll receive, we can let them go, knowing there are plenty who will see value and buy from us. Changing our pricing may not be solution, but rather developing our communication skills.

Raising prices

It’s same with raising prices. We may gain customers. However competitors may raise theirs, too, and keep their existing customers. If we raise prices and sales decline, it’s not automatically a bad thing. We need to examine our net profits. If our profits are same or higher, we’re okay. Also, if sales decline, we should see if there has been an overall market decline, rather than a decline in our market share.

In summary, analyze pros and cons that affect various pricing options you have. If you have extensive industry knowledge, trust your intuition on pricing. Review your pricing frequently, but don’t change it frequently. It’s good to experiment in beginning, but after start-up phase, change your pricing only if there is some fundamental change in your product, service or market. Do your homework, experiment scientifically, and don’t get yourself into a pickle!

6. ...because you can control its design

At a free web site host, you normally have limitations as to what kind of look to have- if you own site yourself, options are only limited by your imagination. If you have an idea that is beyond your capabilities, you can always pay someone to bring idea into fruition for you.

7. ...because you can give away or sell parts of your website that you aren't using.

Let's say your hosting account gives you unlimited free auto-responders (robot-like emails that work similiar to fax on demand). You either don't know what they are for, or don't need them. You could re-sell those auto-responders to other site owners. You can also think about registering a domain name for your area, and giving neighboring businesses sub-domains as a Christmas promotion.

For example, if your business is located in a strip mall called Lotsa Shops, you could register mylotsashops.com and give other stores in mall static information pages like pizzaplace.mylotsashops.com - as sub-domain there aren't all benefits of a full web site, but enough to be appealing as a free listing. And you could put a one line ad about your site at bottom of each page.

8. ...because you can accept advertisers

Generally, if you have a strong product, you probably don't need links leading out of your site. Your customers are probably going to leave your site eventually anyway, so you might as well sell advertising, at least at first to cover your hosting costs. There's also possibility of starting an electronic newsletter, with information that your local area would be interested in. You could charge local merchants, or anyone who feels your audience is valuable, to place ads, once your circulation rises above 1000.

9. ...because you can use it to expand your product line

Even if you don't need your website for any other reason, another possibiility is selling information about your field. No matter how long you've been in business or studied your area of expertise, you know something about it that no one else knows, or you have a unique perspective that no one else has. If there is enough interest, you could create a manual and sell it online to hundreds or thousands of other merchants who could use a heads up. Or you could give it away free to promote interest in your site.

10. ...because in end, it can save a lot more money than it costs to have.

If you're a home-based business owner or a small business owner whose product or service has regional, national, or international appeal, then you should really have a website. It can save you hundreds of dollars in marketing and advertising in long one and bring you customers you may not otherwise reach.

Tinu’s friends bet her she couldn’t put her traffic where her site is- guess who won? Find out how she did most of this for free by downloading her Free Traffic Weapons Ebook at http://www.freetrafficdirectory.com/?timearticle.shtml