by MHolland | Oct 17, 2025 | Business Tips, Cash Flow, Selling Tips, Systems
Why Are Business People So Price Sensitive?
If I walked up to ten business owners right now and told them to raise their prices 5%, what do you think they’d say?
“No way! My customers will leave!”
Then comes the usual backup excuses:
“My competitors already charge less than me!”
All your competitors?
“Well, no… but a lot do.”
That’s where the thinking goes off the rails.
Price only matters when everything else is equal. The only time price is truly the deciding factor is when you’re selling a commodity—or when an entire industry has trained its customers to shop solely on price.
Most business owners act like they’re selling a commodity when they’re not—at least not in the eyes of their customers.
When You’re the Customer
When you shop, do you pick solely based on price? Rarely.
If all else is equal, sure, you might go cheaper. But in most cases, you’re looking for:
And when those things show up, price stops being the main issue.
The Only Viewpoint That Matters
If you’re basing your prices on one of these two perspectives, you’re dead wrong:
-
Your cost structure
-
Your competitors’ prices
The only perspective that matters is your customer’s perception of value.
When you buy something, do you care what it costs the seller to make it? Of course not. You’re focused on the value it gives you.
Imagine someone saying:
“Our prices are higher because our utility bills and staff costs went up.”
Crazy, right?
Customers don’t care about your costs—they care about the outcome, the solution. People don’t buy a drill; they buy the hole the drill creates.
Why Customers Really Leave
Here’s what research shows about why people stop buying from a business:
That totals 32%.
So why do the other 68% leave?
Perceived indifference.
That word perceived matters. Business owners often say, “We love our customers.” But if the customer doesn’t feel it, they leave.
It’s like a husband saying, “Of course I love you. If that ever changed, I’d let you know.”
It doesn’t work in marriage, and it doesn’t work in business.
You can’t assume loyalty just because they’ve been with you for 15 years. If they stop feeling cared for or valued, they’ll move on to someone who shows them they matter.
What the Numbers Reveal
Let’s talk numbers.
Suppose your gross margin is 30%. That means your cost of goods sold is 70%.
If you discount your prices by 10%, you’ll need to increase your sales volume by 50% just to break even.
That’s a dead-end strategy.
Now flip it. If you raise your prices by 10% at the same margin, you could lose 25% of your customers and still make the same profit as before.
In reality, if you’re adding genuine value to loyal clients, you’re unlikely to lose much of anyone.
The Real Game: Value, Not Price
Most accountants push cost-cutting and discounting as the path to profit.
That’s a losing game.
Our approach?
We help clients increase their value package—so they can confidently charge more based on perceived value, not cost.
Because when customers see real value, price stops being the conversation.
Thanks for reading.
If you want to shift your business from price pressure to value power, start by asking yourself:
“What do my customers really value—and how can I show them they’re getting it?”
by MHolland | Sep 5, 2025 | Business Tips, Selling Tips, Systems
We all know service is the key ingredient in running a successful business. But how important is it really?
Recently, my wife and I spent a few days at a hotel that, on the surface, was jaw-dropping. Unique. Special. Remarkable. We’ve stayed in boutique hotels around the world – from Kenya to Europe – and some of them left us with unforgettable memories. Almost always, the reason wasn’t just the architecture or location. It was the service.
A Factory That Never Was
This particular hotel had invested heavily in its design. The theme – an “old factory renovation” from the 1800s. From the moment you arrived, you felt transported. A rail line embedded in the walkway. Black-and-white photos of factory workers. Rusted tools in display cabinets. Cracked windows, faded tiles, furniture that looked vintage but wasn’t. Every detail was carefully manufactured to create the illusion of history.
And I’ll admit – they nailed it. The place was stunning. Except for one fatal flaw.
When Service Kills the Experience
From the first meal, the service fell flat. Staff moved around like they were heading to a funeral. No warmth. No welcome. We had booked for a week but quickly felt unwelcome.
One example stands out – we asked to see a different room type for a future stay. The front desk clerk acted like a prison guard, scolding me for touching the bedspread. “Do not touch the bed! We’ll have to call the cleaners again!” (For the record, my hands were clean. 😂)
Almost every interaction felt upside down. We were the ones making small talk and trying to spark smiles. By the end of the first day, we cut our stay from one week to one night. At checkout, they even tried to charge us a penalty for leaving early.
To their credit, when we asked to see the manager, she was gracious, apologetic, and quick to waive the fee. I truly hope she can help turn things around. The investment in infrastructure and design was a clear labor of love. But without service, none of that matters.
The Lesson
Here’s the point – service is everything. You can have the most beautiful product, the slickest office, or the most advanced systems. But if your service is cold, inconsistent, or dismissive, your business will suffer.
The opposite is also true: with outstanding service, customers will forgive imperfections, delays, and even the occasional mistake. Because they feel cared for. They feel valued.
Want your business to soar? Build service standards that make people say, “I’ve never felt taken care of like this before.”
Bottom line: Infrastructure gets attention. But service wins loyalty.
A Side Note on Productivity
On a another note, I just read a powerful blog post from the Freedom app team on reclaiming time with digital minimalism. They show how you can gain an average of 2.5 hours per day simply by managing your app use. A great reminder that just like service, small changes in behavior can deliver outsized results.
👉 Read it here.
by MHolland | Jul 4, 2025 | Business Tips, Cash Flow, Selling Tips, Systems
Yes, you read that right.
You cannot increase sales.
Not directly, anyway. That is because sales are a result, not an activity. You cannot manage sales, profits, just like you cannot manage even weight loss directly—those are outcomes. What you can manage are the activities that lead to those outcomes.
This might sound simple, but it is one of the most misunderstood ideas in business. Let us fix that.
Stop Managing Outcomes. Start Managing Activities.
Let us use weight loss as an example. You cannot just decide to lose 10 pounds. What you can do is manage your eating habits and increase your physical activity. Those are the drivers. The weight loss is a result.
Sales work the same way.
You cannot just declare, “We’re going to increase sales!” and expect it to happen. Instead, focus on the activities that create sales.
The 3 Building Blocks of Sales
There are only three ways to increase sales:
- Increase the number of customers (of the type you want)
- Increase how often they buy from you.
- Increase how much they spend each time.
That is it. Every sales strategy fits into one (or more) of those categories. Let us break them down.
Get More Customers (The Most Expensive Way)
When people say, “I’m going to grow my business,” they always mean getting new customers. And yes, it is important—but it is also the most expensive strategy.
Marketing, advertising, lead generation—they all cost time and money. Worse, new customers often require the most handholding.
So yes, keep attracting new clients. But do not stop there.
Increase Purchase Frequency (Often Overlooked)
Want a smarter way to boost revenue? Get your existing customers to come back more often.
They already trust you. They have already bought from you. This is low-hanging fruit.
Ideas to increase purchase frequency:
- Send a monthly or quarterly newsletter with promotions or insights.
- Offer loyalty cards or referral bonuses.
- Pick up the phone and check in with past clients.
- Host client appreciation events.
True Story:
An accountant blocked off every Friday morning just to call clients and ask how things were going. Nothing pushy—just open-ended business conversations. The result? His revenue doubled. Clients appreciated the proactive care and naturally brought him more business.
Increase the Average Sale (Mastered by McDonald’s)
You already know the question:
“Would you like fries with that?”
That simple upsell script has added billions to McDonald’s bottom line. What is your version of the fries question?
Ideas to increase average transaction value:
- Bundle products or services into higher value packages.
- Upsell or cross-sell relevant add-ons.
- Implement a small price increase (even 5% can have a major effect)
- Train your team to ask value-focused questions.
Real Example:
One client raised prices 5% after a little convincing. Guess how many customers they lost? Zero. Loyal customers did not blink, and the increase went straight to the bottom line.
Think Compound Impact
Here is where it gets fun: if you improve each of the three areas by just 5%, the result is a compound growth effect that can add 20–30% more profit to your bottom line. Without finding a single new customer.
Want to see it in action? Try this quick exercise:
Profit Improvement Plan (Fill-in-the-Blanks)
| Component |
Current Position |
5% Improvement |
New Position |
| Number of Customers |
___ |
x1.05 |
___ |
| Purchase Frequency |
___ |
x1.05 |
___ |
| Average Sale ($) |
___ |
x1.05 |
___ |
| Sales Revenue |
___ |
= |
___ |
| Gross Margin % |
___ |
(same or better) |
___ |
| Net Profit |
___ |
(should grow!) |
___ |
Now subtract your current net profit from your new projected one.
That is your Profit Improvement Potential—from managing the right activities, not chasing the result.
Final Word
Stop trying to “increase sales.”
Start doing the things that lead there.
- Get more of the right customers.
- Stay in touch and serve them often.
- Raise your average sale with simple strategies.
And most of all—track what matters. Because what gets measured gets managed.
Thanks for reading…
by MHolland | Mar 21, 2025 | Business Tips, Selling Tips, Systems
Micro-habits work…
What are micro-habits, you ask? They are tiny ways to get started on setting new habits versus setting Big Goals that never happen. As in, put on your jogging shoes and run in place for 2 minutes versus 30 minutes of exercise as a goal. Or, in business, call one customer a week for 3 minutes.
I use two apps that help me develop habits and fulfill on my goals.
Habit Loop tracker is a terrific app that you use on your phone (funny that we call it a phone, when it so much more than that, right?).
You simply create a habit you want to track, set notifications, and, then, well, track it! For me, a simple personal example is stretching with bands. I set the habit for daily tracking and for 10 minutes.
I know I can do 10 minutes! Maybe 20. Thirty minutes – maybe. Yet every day, that starts to seem like a grind and no fun. I also do 15 minutes of stretching. I would never do 30. You get the idea.
Start small. Because the habit is King. The habit is the goal. It will either be enough, or stretch out beyond the micro habit.
In business, I am singing a tune more and more with my clients of improving only 1%. In four areas. The effect can be wildly powerful.
Here is what I am saying – 1% price increase, 1% savings in Cost of Goods Sold, 1% volume increase, and 1% savings on fixed costs.
For example, a business with $10 million in sales implementing a 1% price increase adds $100,000 to the bottom line. We have not even started on the other 1% improvements yet! The leverage effect is incredible.
Here is a great article from the Freedom App people talking more about Micro-Habits: Micro-Habits With Freedom.
(PS – that is the 2nd app I use daily – the Freedom app. I block websites to avoid distractions and stay focused on – you guessed it – my habits. Habits are King).
Capital Gains Exemption
Here is a good article on recent changes to the Capital Gains exemption for small businesses in Canada: Capital Gains.
Marketing on LinkedIn
Here is a good article on increasing your profile on LinkedIn, a global network with one billion members – Linkedin-7 Tips To Improve Your Company Profile
Have a great weekend, and thanks for reading…
by MHolland | Mar 14, 2025 | Business Tips, Cash Flow, Selling Tips
In the last few weeks, I have written two blogs that were repeats from a few years ago…
These blogs are focused on the first three ways of the 4 Ways to Grow Your Business (any business).
The following is the third part in the series. Enjoy!
What is the 3rd Way to Grow Your Business?
Over the last 2 weeks I wrote about the first two ways to grow your business. Today I am going to write about the 3rd Way to Grow Your Business.
As a refresher – the 1st Way is to increase the number of customers of the type you want. Here the big takeaway is to find out who is serving clients in your industry and create a relationship with those businesses, so you can get direct “warmed-up” access to their clients. This transforms a cold marketplace to a warm one. For the full Blog post, please click here:
Leverage Your Business – There Are Only 4 Ways to Grow, As You Know
The 2nd Way, which I wrote about last week is to increase the number of times (on average) your customers do business with you. For the full Blog post, please click here:
The Best Way to Leverage the Growth in Your Business – Part 2
The 3rd Way to Grow Your Business is this – to increase the amount people spend with you during each interaction (in accounting terms – increasing the transactional value of each sale).
The strategy and the resulting actions you will take are completely different from the first two ways to grow when you focus in on this way.
And, by combining all three together you will have the potential to create massive increases to your Net Profit.
Find the Key Number
First, to increase something, you need to know what your starting point is. For this Key Performance Measurement, it is quite simple and easy to find.
You just take your total sales for the period (month, quarter, year) and divide that by the total number of sales invoices issued to get your average dollar amount per transaction.
Ok, now that you have a starting point…
How do You Increase Your Average Sale Without Sounding Salesy?
One way is creating scripts to use to simply ask your customers if they want to add to their purchase.
Of course, we all know the ubiquitous line from McDonald’s clerks, “would you like fries with that burger?”
And what they know at McDonald’s is that this has a profound impact on the average sale per customer and the net profit.
Another way to view “scripting” is to take the opportunity to educate your customers/clients on all the services/products you offer. Your customers may just not know you offer certain things and will often be delighted to spend more with you because you are adding value to their lives!
In fact, it is the focus on adding value, on educating your customers with a solution-minded intention that moves you from simply sounding “salesy” and mechanical to interested, and educational.
Newsletters are a fantastic way to educate your customers and not only increase your average sale, but to increase your transaction frequency.
Discounting is Bad, But It is Ok When You Do This First
Another way to increase your average sale is to bundle things into packages or offer 3 for 2 specials.
For instance, if someone is interested in cross-country skiing and they have not skied before, they do not come in to just buy skis. They also need, boots, poles, gloves, a parka, a toque…you get the idea. Even lessons.
All these items can be packaged into a beginner cross-country ski package and a discounted price offered for the bundle.
We do not recommend our clients offer blanket discounting across all their product lines as a way to grow sales, however, when bundling, it is ok to offer a reduced price for the whole package.
The reason is that the increased amount they are spending justifies the discount.
Add Value and Raise Prices
Finally, it may be time for a price increase. First you must examine your products/services and ensure that the value you are offering is high and service levels are high in terms of quality, timeliness, and so on.
Most business owners under-value their products/services – looking at them through the lens of their competitors rather than their customers.
Many business owners are fearful of raising prices, yet when they do, they often are surprised to discover that almost no customers leave, and the few that might were often price-shoppers and difficult to deal with anyway.
Case Study in Action
A few years ago, we met with a client to do some strategic planning.
The client was a log home builder, and they built exceptionally beautiful homes.
We went through the 4 Ways to Grow and saw quickly that the only leveraged way to grow was the 3rd Way – increase the average sale of each transaction.
(After all, how many log homes per year would most people likely buy? So, transaction frequency could not easily be increased).
The power of this focused, strategic way of the thinking is that we could rule out the second way and concentrate a lot of our attention on the 3rd Way.
I knew that the owner had outsourced the marketing and sales to another company. I also knew – from observation – that the marketing people were doing very well financially by the amount of time spent golfing, the cars they drove and the commissions in the business being paid out.
This client was giving up a lot of profit.
So, I asked the owner – “why don’t you get your wife to do the marketing? After all she is incredibly good at building websites and could put together a nice presentation.”
His initial answer was, “no way!”
I asked, “why not?” (Good business coaching is asking rocket science questions like this!)
He told us that the marketing guys had an extensive network throughout the USA and that if he moved away from them, he could never, ever replace those valuable contacts they had developed over years and years.
I kept probing and pushing a bit, and he decided to go for it and get his wife involved in the marketing and do it all in-house.
The results were explosive!
The very next year his sales doubled, and his net profit margin hit 50%!! This was an unheard-of net profit in the log home building business.
He sold homes to very wealthy people, including the 4 chalets at the Salt Lake City Olympics.
This volume continued over the next few years, so he became quite well off.
Thank you so much for reading…
by MHolland | Mar 7, 2025 | Business Tips, Cash Flow, Selling Tips
So, the U.S. just hit Canada with a fresh round of tariffs. Great. But instead of panicking, let us talk about opportunities—because there are ways to not just survive but thrive in this new reality.
Remember, the tariffs did not just affect you alone if you sell into the USA. It affects everyone else in your industry. By getting creative, taking massive action (in the right direction), you can grow your business inside this demanding situation.
Many businessowners will react with fear. Fear often leads to inaction. This is where you can take the lead and get proactive.
Oh, and remember this – the Canadian dollar is weak right now. This is bad news for vacations but fantastic for selling into the U.S. market. If you play your cards right, you could come out ahead. Here is how.
Turn the Weak Loonie into a Power Move
With the Canadian dollar low, your products just got cheaper for U.S. buyers. Even with tariffs, you might still be the best deal in town. Make sure your U.S. customers understand this advantage—lock in contracts while your pricing looks attractive.
Sell Beyond the U.S. (Yes, it is Possible!)
The U.S. is Canada’s biggest trade partner, but it is not the only game in town. Trade deals like CETA (Europe) and CPTPP (Asia-Pacific) give you tariff-free access to other markets. Time to explore who else wants what you are selling.
Get Smart About Supply Chains
If tariffs are making it painful to import materials from the U.S., look at domestic suppliers or other international partners. Some Canadian companies are already shifting supply chains to Europe and Asia to dodge extra costs.
Lock in Pricing Before It Gets Worse
If you are exporting to the U.S., now is a great time to negotiate longer-term contracts with customers. Tariffs can change, but locking in deals while the currency works in your favor can help hedge against future cost spikes.
Play the Government Support Card
There is a good chance the Canadian government will roll out tariff relief programs, tax breaks, or incentives to keep businesses competitive. Stay plugged into industry associations and government resources—you might be leaving money on the table otherwise.
Pass Tariff Costs Smartly
If you have to raise prices, do not just slap a tariff surcharge on your invoices. Look for ways to add value so customers do not just see an extra charge but a better overall offering. It is bundling services, improving delivery times, or locking in loyalty rewards.
Cut Costs, the Smart Way
Instead of slashing staff or quality, look at efficiency plays. Are there manual processes eating up time that you could automate? Could bulk ordering save costs? Small tweaks can protect your bottom line without killing morale or product quality.
Work the Trade Rules
Some tariffs have exemptions or workarounds. Depending on what you are selling, you might qualify for duty drawbacks, trade programs, or reclassifications that reduce the impact. A good trade lawyer or consultant can help you find loopholes you did not even know existed.
Bottom Line – Tariffs Are not the End of the World
Sure, tariffs make things harder. But with the right strategy, they do not have to crush your business. Play the weak Canadian dollar to your advantage, explore new markets, optimize costs, and keep an eye on government support.
Lastly, awesome service is, now, more than ever, a competitive advantage. Any business in a tough economy is going to suffer when they do not have awesome service.
Remember this, it is not just the quality of the product or service you sell – it is the process of delivering it that defines awesome service.
You do not, unfortunately, get to define awesome service – your customers do.
And one last-last thing! This is not Canada’s first tariff rodeo—we have survived before, and we will do it again. The smart businesses? They will come out stronger than ever.
Thanks for reading…
