Pricing by Fear (The Mistake That Kills Margins)

Michael Barbarita • January 16, 2026

"I can't charge that much." Not based on market reality. Based on your fear.



Your profit margins suffer from emotional pricing. Your revenue growth stalls because you're afraid of rejection.


The psychology of fear-based pricing:


You assume customers will say no. You imagine losing the deal. You feel personal rejection. You lower your price to avoid that feeling.


But you never tested reality. You never actually asked for the higher price. You negotiated against yourself before the customer even objected.


Your financial performance deteriorates from untested assumptions. Your profitability strategies fail because they're based on fear, not data.


The solution: Test price increases with a small segment. Track actual responses. Usually, the fear far exceeds the reality.


One contractor was "certain" raising prices 15% would lose half his customers. He tested with new inquiries only. Lost 8%. The 92% who stayed more than made up for it.


Your business efficiency improves when you stop wasting energy worrying about imaginary rejection. Your earnings improvement accelerates when you discover most customers care less about price than you think.


The customers who do leave over price? They were never your ideal customers anyway. They were price-shoppers who would've eventually left for someone cheaper.


Your bottom line growth comes from attracting customers who value quality, service, and results-not from serving everyone who wants the lowest price.


Most business owners never test because they're terrified of what they'll discover. They price by fear indefinitely, leaving massive profit on the table.


You're testing. Discovering that your value is higher than you believed. Building confidence through real market feedback instead of imaginary scenarios.


Business Owners hire Next Step CFO to double and triple their profit using business and financial strategies that their competition isn't doing.