I've been thinking about how to set membership pricing so that there interests of all stakeholders are met:
- it should be cheap enough that members regard it as a bargain and new members don't see pricing as a major obstacle;
- it shouldn't be so cheap that we have a two year wait list to get in;
- investors need to be compensated for the risk they are taking, so there needs to an economic return for them;
- etc.
I've been thinking that, at least for the first year, we will have to have some level of flexibility... but we cannot do that in a way that frustrates members. Here is my current thinking:
- Rates are ininitally set below where we think they ultimately should be in order to get people in as quickly as possible, and also to thank them for joining early and compensating them for any teething problems we have during the early days (although hopefully that'san overly conservative reason for wanting to give them a good deal!);
- We could tell everyone what our plans are for rates so they know what increases are likely and therefore plan for that, or we could put a cap on them... eg. "full time desk will not cost more than $X per month during the next 12 months", meaning no one goes to the effort of moving their business into the space without some certainty on the maximum cost.
- I think all members should pay the same as others on the same level - ie. if we're having trouble filling the place, we don't offer special deals to new members that existing members don't have access to... you should never treat new clients better than existing clients, even though many businesses do!
- That means, if we decide to reduce the rates then all members get the new reduced rate
- Any member that wants to pay in advance for more than one month can lock in their rate for a period of time. So if someone pays in advance for a full year, any increases do not get passed on to them until they are next due to pay. However, any decreases ARE passed on via a refund... again, you can't penalise people for doing something that is beneficial to you such as paying in advance for more time.
I think this suits both sides - the members are treated fairly, know the maximum they may have to pay and have the ability to lock in a rate by paying in advance for more time. The owners get the flexibility to change rates within the limits they set without being accused of chaning the rules on anyone or treating new clients better than existing/loyal clients.
Any thoughts or ideas to add?