How to Price Your Products and Services as a Small Business Owner

Podcast cover featuring Fi Johnston with the title "How to Price Your Product or Service" on a teal background. — A practical framework for setting prices that support your income goals, including how to break down revenue targets using the two key levers available to every business owner: price and volume. Learn why pricing matters more than you think, and how to stop undercharging.

**Pricing Strategy**: In this episode of Money Secrets, Fi tackles one of the most important decisions every business owner makes: pricing.

Listen to Episode 71

What You’ll Learn in This Episode

Why undercharging is so common. Many small business owners price based on fear, affordability, or a desire to be liked rather than business sustainability.
The hidden cost of being "affordable." Low prices can create perceptions of lower quality and attract the wrong customers.
Why pricing has such a significant impact on your income. Your pricing decisions directly influence your ability to generate revenue and profit.
How to calculate what you need to earn. Breaking down annual revenue goals helps create a realistic plan for achieving them.
The two levers that drive revenue growth. Every business can increase income through either higher prices or higher sales volume.
Why increasing prices is often easier than increasing volume. Raising your average sale can be more effective than constantly chasing more customers.
How to use pricing to reach your revenue goals. Fi shares practical examples for both service-based and product-based businesses.
Why understanding your costs matters. Time, delivery costs, and business expenses all need to be factored into your pricing.
How pricing influences customer perception. Your prices communicate value, experience, and quality before a client ever works with you.
What high-quality clients expect. Savvy customers understand that great products and services come with an appropriate price tag.
How pricing supports business sustainability. Charging appropriately creates room for better customer experiences, stronger delivery, and greater impact.
Why pricing is both a financial and strategic decision. Setting prices isn't just about covering costs—it's about positioning your business for long-term success.
The mindset shifts needed to charge more confidently. Understanding your value helps you move beyond scarcity thinking and price with intention.
How to build a more profitable business. Small pricing adjustments can have a significant impact on revenue without increasing workload.

How to price your product or service (EP#71)

Introduction

We've made a lot of progress as a society in many areas, but one thing that hasn’t changed enough is our relationship with money. If we want to tip the scales in favour of marginalised people, we need to understand the secrets to making money in small business.

The more we talk about money — especially the secrets that usually stay behind closed doors or on the golf course — the more empowered we become. My mission is to get more money into the hands of good people, specifically business owners like you.

Because I believe small business can change the world. And to do that, we need to be making more money.

Acknowledgement of Country

This episode was recorded on the lands of the Wurundjeri People of the Kulin Nation. I’d like to acknowledge them as the Traditional Owners and custodians of this land and water that I live, work and play on.

I pay my respects to Elders past and present, and recognise that sovereignty has never been ceded. This always was, and always will be, Aboriginal and Torres Strait Islander land.

How to Price Your Products and Services Without Undercharging Yourself

Pricing is one of the most important decisions you'll make in your business.

It's also one of the most misunderstood.

Many small business owners spend hours thinking about marketing, sales, and content creation, but very little time thinking strategically about their pricing. The result? They end up undercharging, overworking, and making it much harder than necessary to reach their income goals.

In this episode of Money Secrets, Fi Johnston shares a practical framework for pricing your products and services. Drawing on 25 years of experience working with small business owners, she explains why undercharging is so common, how to break down your revenue goals, and why your price plays a crucial role in how clients perceive your business.

The Most Common Pricing Mistake Small Business Owners Make

According to Fi, almost every business owner she has worked with has been undercharging when they first started working together.

Often, undercharging isn't a numbers problem—it's a mindset problem.

Many business owners believe they need to be affordable, accessible, or cheaper than their competitors to attract customers. Others worry that increasing their prices will make people like them less or reduce demand for their services.

The reality is that pricing too low often creates the opposite effect.

Rather than communicating value, expertise, and quality, low prices can unintentionally signal inexperience or lower quality.

Why "Affordable" Isn't Always the Goal

Many business owners aspire to create exceptional products, deliver outstanding customer service, and build meaningful relationships with their customers.

Those goals require time, skill, experience, and resources.

Small businesses rarely have the economies of scale that large corporations enjoy, which means competing purely on price is often unsustainable.

Instead of asking:

"How can I be more affordable?"

A better question might be:

"How can I create so much value that my pricing reflects the quality of what I offer?"

The businesses that thrive long-term are often the ones that focus on value, not simply affordability.

Understanding the Two Revenue Levers

One of the simplest but most powerful concepts Fi shares is that there are only two ways to increase your revenue:

1. Increase Volume

Sell more products, book more clients, or complete more projects.

2. Increase Price

Charge more for the products or services you're already delivering.

Many business owners immediately focus on increasing volume. They assume they need more clients, more sales, more leads, or more work.

But increasing volume often means increasing workload.

Increasing price, on the other hand, can improve revenue without requiring significantly more time or energy.

Good Money Club

If this conversation resonated, you don’t have to figure it out alone.

Good Money Club is open right now.

Inside Good Money Club, women business owners:

Learn to understand and manage their own money
Build financial roadmaps
Develop sustainable pricing strategies
Get accountability and support
Increase revenue and take-home pay
Make bold, ethical money decisions

If you’re ready to:

Earn more
Pay yourself properly
Build a sustainable business
Reduce money stress
Close your own revenue gap

You can learn more about Good Money Club while doors are open.

Break Your Revenue Goal Into Simple Numbers

One of the most effective ways to price confidently is to work backwards from your revenue goal.

Start by asking:

How much revenue do I want to generate this year?
How much will I charge?
How many sales, clients, or projects will I need?

For example:

If your goal is $100,000 in annual revenue and your average project value is $5,000, you'll need 20 projects across the year to reach your target.

When you break the numbers down this way, pricing becomes far more strategic.

Rather than guessing what feels reasonable, you're making decisions based on what is required to achieve your goals.

Don't Forget the Cost of Delivery

Pricing isn't just about the final number.

You also need to understand what it costs to deliver your product or service.

That includes:

Materials and production costs
Software and subscriptions
Contractor expenses
Shipping and fulfilment
Your own time and expertise

Understanding the true cost of delivery helps ensure your pricing supports a sustainable and profitable business.

The Clients You Attract Matter

When pricing is too low, it can have unintended consequences.

You may find yourself attracting clients who are highly price-sensitive while turning away the clients who genuinely value expertise, service, and outcomes.

Pricing sends a message about who your offer is for.

If you want to work with high-quality clients who respect your expertise and value the results you deliver, your pricing needs to reflect that.

Final thoughts

Pricing isn't about picking a number that feels comfortable.

It's about creating a sustainable business that supports your goals, reflects your expertise, and attracts the right clients.

If you're currently questioning your prices, start with these three principles:

Assume you may be undercharging.
Work backwards from your revenue goals using price and volume.
Remember that your price helps shape your positioning in the market.

The businesses that create the biggest impact are often the ones that price confidently enough to support their growth.

Because when good business owners make more money, they can create more opportunities, more employment, and more positive change in the world.

Outro

Thank you for listening to Money Secrets. If you loved this episode, please subscribe, share it with a friend, or leave a review. Your support helps us get these conversations into the hands of more good people who deserve to thrive in business.

We’ve come so far as a society in many ways, but money is one of the areas where progress hasn’t been enough. If we want to tip the scales in favour of marginalised people, it starts with understanding the secret: money in small business.

In this podcast, Money Secrets, host Fiona (Fi) Johnston—Chartered Accountant, small business advocate, and impact enthusiast—dives into the conversations we need to have about money. The secrets that once stayed behind closed doors (or on the golf course) are finally out in the open.

Fi’s mission? To get more money into the hands of good people, like you. She believes small businesses have the power to change the world, and the key to making a bigger impact is to make—and manage—more money.

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Thank you to everyone involved for bringing this podcast together. We are excited to hear from you with any questions, feedback or suggestions for future episodes that you might have. Send a Direct Message to @peach.business

If you are excited for what’s to come, please like this episode, follow the podcast and share it with your friends. We are thrilled you're here.

Want to find out more about Good Money Club? It's for female and non-binary business owners ready to make more money and impact. Join us?

Check out my FREE Pricing Training you need to set your prices for profitability.