As you grow your business, you’re going to eventually have to do thing differently than you are now.

Maybe you’ll do more networking.

Maybe instead of selling only products, you’ll start adding services.

Maybe you’ll raise your rates. Or hire employees. Or delegate something that right now would have to be pried out of your cold, dead hand.

Whatever these things are, they’ll represent a substantial change from your status quo.

It will probably take you longer than necessary to make these changes, because change feels scary.

Humans are really good at adjusting or adapting to things that are forced upon them.

If the power goes out for a week, you figure out how to get by, even if it sucks and it’s chaos. If you have to take care of your niece for three months because her mother’s in the hospital, you figure out a way to step up to the task.

These represent pretty sudden and high-impact changes. And yet, with startlingly few exceptions, we handle it and find our way through.

Somehow, though, when we have to bring the change on all by ourselves, the impact seems bigger, more painful, more dangerous. To initiate that change by our own hand feels like walking into the lions’ den. We can’t do it.

Change feels like it will be too hard to handle, and so we delay … until something forces us to change.

Here’s something to take with you over the weekend.

You aren’t really afraid of “change.” You’re afraid of what change means to you, personally. What you’ll have to do differently, what you’ll have to stop doing, where you’ll have to move out of your comfort zone.

And, to take it further, what you’re experiencing isn’t technically fear. Fear is based on something that’s happening now. If you’re running to a plane while the final call announcement blares from the speakers, that’s happening NOW.

When we worry about what would happen in the future if we did something, that’s called dread. That means we think the experience is going to be too much for us. That it will overwhelm us, or that we will fail.

But you have already handled a lot of experiences that took you out of your comfort zone.

You have already tackled things that were hard and managed to do it.

You have already taken failure and turned it into success (or success enough).

You have already experienced failure and survived.

Change becomes a lot less scary when you compare it to a previous experience.

I don’t know what makes you feel uncomfortable about growth and change. (For me, the worst part is having to admit to someone else that I should have done it sooner and I knew it.)

But this weekend, think of a big step you want to take with your business.

Think of what worries you and scares you and fills you with dread. Give all those things names, put them in words, and it takes a lot of the edge off.

Then think of the ways you have handled things like that in the past. How you managed to get through it, and how you’re still here, alive and kicking.

That might give you the confidence to take that next leap sooner, rather than later, and with a whole lot more peace in the process.

About the author: Naomi Dunford started IttyBiz in 2006. In her free time, she likes to… ha! Free time. You’re adorable. Learn more about her here and catch up with her on Twitter or Facebook.

This just in from the Ask IttyBiz mailbag

“What happens when I am so freaking busy we can’t ship orders on time? We have grown by over 35% year to date. We’ve added new equipment, a ton of employees (seriously I think over half of my employees are new) and we are still shipping 2 weeks late. I’m turning away new customers – store chains that I have to tell ‘let’s revisit this in a few months because we can’t handle the business we have’.

Is there more I can do? How can I handle this better? AAAAGGGH!*

– Stephanie

[* Editor’s note: In the spirit of full disclosure, I added the “AAAAGGGH”.]

Great question, Stephanie.

On one hand, this is a good problem to have because – Yay! – you’re growing. On the other hand it’s brutal, because you’re watching opportunities slip away and you’re having difficulty keeping up with current customers.

So, here are a few ideas.

1. Start with getting specific on all your bottlenecks.

If you can’t keep up with the pace of incoming orders, you’re probably having difficulty keeping up with exactly what’s causing problems and bottlenecks for you. Depending on your personality / level of ADHD, if any, the number of things you’re unaware of range from “a few things” to “almost everything”.

Beg, borrow or steal one hour as son as you can and find some place where you can run away and hide. Then play the last few weeks over in your head and write down every issue and bottleneck you can, and address each problem in specific words.

By specific, I mean “Incoming orders aren’t getting processed within 24 hours”, not “Our invoicing system is screwed up”.

Once you have a full list of issues, you then have the power to start figuring out what to address in which order – and you also know how to tell what it will take to fix them.

This will probably be the hardest thing to start, because describing any problem in full detail can be daunting. But once you have it done, everything else becomes easier (and in many cases, finally possible to fix).

2. Identify what’s going wrong with your current solutions.

I’ll assume that you haven’t been sitting on your thumbs this whole time, and you’ve been scrambling to put your best stabs at solutions in place. High-fives to you.

Now you have to assess whether your solutions are actually working. We often think a particular idea (like hiring an employee) will help, but we don’t pay attention to whether it’s working out the way we thought it would.

It’s like we think “I did this thing, so that should fix the problem.” And if we still aren’t seeing the results we expected, we default to thinking that there must be something else we should be doing instead.

Sometimes that’s true. Sometimes our first attempt at solving a problem flat-out doesn’t work, and we need to try something different. But other times the solution we put into place isn’t performing the way we want it to, and that can be solved by tweaking it.

Look at what you’ve put in place with a set of fresh eyes. (Request someone else’s fresh eyes, if necessary.) You may be able to get some traction that way.

3. Identify what you can pay for (or overpay for) in the short term.

In the version of the future you hope to arrive in one day, you will have grown, and this will not be a problem anymore. So a primary issue here is that right now, you’re in your awkward tween years.

Something is eventually going to have to change to give you that growth spurt – maybe it’s hiring a manager, or getting a bigger facility, upgrading your equipment, or getting additional employees that can take other business activities that you’re doing now. (For example, you’re not always going to be negotiating with large clients yourself.)

These things cost money. In the here and now, we don’t want to spend this money because a) we don’t have it, or b) we’ll take a loss rather than a profit.

This may be the time when you have to take a temporary loss. The only way to make that jump may be to enter your ramen noodle years (or your ramen quarter, depending on the scale of things).

This is generally a difficult thing to make peace with, because when business is growing like crazy we think “Boo-ya! Now we’re going to be (comparitively) rich!” But you may need to look at whether this is the time to be growing the business rather than growing the bank account.

(I hated this part, by the way. With a passion.)

4. Identify unrelated things you can get help with.

If the issue is that you simply can’t keep up with production, this may not apply. If the issue is there’s not enough of you to go around, it might. Finding ways to free up more of your hours by paying (or asking) people to take on responsibilities for you can help, provided you can handle working that extra time.

This is where you might be ordering a lot of delivery meals, or getting child care, or paying someone to do your grocery shopping or walk your dog. Look at everything that you do during the day that is not work, and ask yourself if paying someone else to do those things will give you the time you need to stem the bleeding.

This will be costly, depending on what you need. But the thing you need to ask yourself is not how much it costs, but whether it justifies the cost, because that’s what matters in the end. You might hate paying someone $50 a day to walk your dog, but if it helps you secure $5,000 in business or lets you deliver a $2,000 order on time, it might be worth it. Check on a case by case basis.

5. Ask yourself how much of this will age out.

New employees suck. Not because they suck, but because everything sucks at the beginning. Your productivity is way down because you’re training them or fixing their mistakes. Their productivity is down because you’re too busy to answer their questions in a timely manner.

New processes suck. It takes time for everyone to figure out how everything works. There are bugs in the process that have to get ironed out.

This is normal, and it goes away after a while. You have to look at each problem you’re having and ask yourself if it’s an unavoidable part of growth. If it is, you can at least have some peace that it won’t always be this way. It’s like having toddlers – you run yourself ragged trying to keep them from running with scissors (and where did they FIND the scissors, anyway?!?) … but eventually that ages out.

That’s what I have off the top of my head. Hope at least some of that helps.


About the author: Naomi Dunford started IttyBiz in 2006. In her free time, she likes to… ha! Free time. You’re adorable. Learn more about her here and catch up with her on Twitter or Facebook.

Welcome to “I Don’t Get It” Wednesday, where we take a marketing-related topic that everybody’s talking about and explain it using short words. In today’s edition, we tackle “price anchoring.”

What Is Price Anchoring?

The very short answer is that price anchoring involves playing a game of Goldilocks with your offers.

Imagine 3 sizes of coffee:

  • 8 ounces for $1
  • 16 ounces for $1.25
  • 24 ounces for $2

The average person is going to look at the small and see that they get double their coffee for 25 cents more and think “Wow, the medium is a real bargain.” They also see that the next size up is 75 cents, and again they consider that the medium is a bargain.

You would think that this means more people would buy the medium coffee.

What it actually means is that more people buy coffee, period.

When they look at the menu, they don’t just see coffee, they see a relative bargain, and it makes them more likely to buy.  Especially if they were on the fence about buying in the first place.

Here’s What Price Anchoring Really Means

If you want to sell more of [your thing], creating a less expensive version and a more expensive version has a strong potential to boost overall sales of [the original thing].

When people think of how much something costs, they’re thinking of the absolute cost. So they make their decisions based on whether they want to spend $300 on that new leather jacket.

But put an $800 designer leather jacket right next to it, and they start thinking “Whoa, I can’t spend $800! I’ll go for the $300 one instead.” Now they’re making the decision of choosing A over B, not choosing whether they want to spend $300. They’re thinking “Well, I can’t get THAT one … but I can get this one – and save my $500.”

In general, you can boost your sales by having multiple options to buy. This is why you see “deluxe” and “platinum” versions of things. Sure, some people will buy the high-end ones because they want it, but the majority will simply have their likelihood of purchased swayed by relativity.

In some cases, price anchoring be good for the customer.

People get overwhelmed easily. Think of the times you’ve stared at a menu, trying to figure out what to order, or had your eyes glaze over at an ice cream shop with 45 flavours. Decisions can be hard to make when you’re in a certain space.

When a restaurant has something “on special”, it helps many people make a damn decision already because they think “Oh, the fish and chips is $4 off today.” When an ice cream shop has a flavour of the day at a discount, there’s going to be a rush on mocha fudge ripple because it’s 50 cents off.

Again, this practice manipulates the customer into making a relative comparison instead of an actual comparison, so they’re being driven by “Ooh, a bargain” rather than “Do I want this?” But in the cases of restaurants and ice cream shops, well, you’re there already. You were going to walk out with something, and price anchoring just made your day easier.

Here’s where price anchoring can get iffy.

Let’s talk about fake prices. MSRP (Manufacturer’s Suggested Retail Price) is one of them.

With MSRP, a retailer can say “Sony says the new SmartTV Platinum has an MSRP of $1,500 – but we’ll sell it to you for $1,199.”

“Wow, what a bargain!” most people say. Except … it’s not. MSRP is a made up number designed to make you think the item SHOULD cost $300 more.

And it works. With TVs, cars, just about everything. And it’s all bogus. But that doesn’t stop it from making you and I both think relatively rather than objectively. Because all that has to happen is for the price to be SUGGESTED. That’s enough to plant the seed in your mind.

Years ago I also recall a clothing retailer in the United States was sued because of their constant ads saying things like “40% off full price” … but they had never offered the items at full price. Everything in their store, every day, was price anchored to a fictional number.

So what do you need to know about price anchoring?

Well, first of all, nobody’s going to stop you from playing the MSRP game. It’s not like it’s a secret I’m unleashing in the wild by virtue of mentioning it here.

But price anchoring may work very well for you for the kind of thing you sell if you can offer options.

If you’re selling a professional service like coaching, you can take your main service and offer an upgraded version and a downgraded version.

If you’re selling products you can offer a bundle so customers can see the full individual price compared to the discounted, bundled price.

If you’re selling software as a service you can just have tiered packages, like web hosts do.

In this case, if your packages are reasonable, there’s nothing ethically wrong with this. There’s a big difference between “price anchoring”, “manipulating” and “lying.” Providing genuine options gives you all the advantages of price anchoring psychology without any of the scheming. And customers can leave happier, knowing there’s an option that works for them.


Thank you for joining us for the Wednesday “I Don’t Get It.” If there’s something about marketing that you don’t get and would like explained in short words, send it on over, and I’ll help you out.

About the author: Naomi Dunford started IttyBiz in 2006. In her free time, she likes to… ha! Free time. You’re adorable. Learn more about her here and catch up with her on Twitter or Facebook.