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21h • General discussion
Most small business owners underprice their products, but why?
Business owners tend to believe keeping prices low will attract more customers. But undervaluing your work is the fastest way to stay stuck.
Here’s the reality:
Many retail stores mark up materials by 100% to 150%. If they buy something for 10 dollars, they sell it for 20 or 25.
In the restaurant industry, markups can reach 500%. A dish that costs 5 dollars to make can sell for 25 or more.
Service businesses often add 30% to 70% markups on materials and labor to cover overhead, taxes, marketing, and profit.
Still, many entrepreneurs feel guilty about charging what they’re worth. They fear clients won’t pay, but the truth is the market rewards perceived value, not effort.
According to a 2024 SCORE study, 82% of small businesses struggle with cash flow, and one of the main reasons is poor pricing strategy.
If your prices don’t cover your costs and generate profit, you don’t own a business, you own a job or worse a hobby.
Markup is not greed. It’s what allows you to grow, reinvest, and serve better. You’re not just selling materials; you’re selling convenience, expertise, service, and peace of mind.
If large companies do it confidently, so should you.
Are you charging what your business truly deserves?
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Most small business owners underprice their products, but why?
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