All companies want to grow. The tough question is how to do it profitably and sustainably. A common approach for many manufacturers is to expand the number of channels through which their products are available to reach customers who otherwise might not try them. However, if that is not done with a proper understanding of segmentation (which customer segments buy in which channels), growth can be fleeting and potentially profit-killing in the long term.
Last week Andy Kessler wrote an article in the Wall Street Journal, The High Cost of Raising Prices, which might scare you into thinking you will ruin your business by raising prices. While I usually enjoy reading his articles and I found a few valid points, I mostly disagree with this article. Don’t fall for the scary stories and false correlations that could make you afraid to raise your prices. When the value you provide to your customers is greater than the price you are charging them, you can and should increase your prices to match the value.