Premium Pricing Strategy: Lessons From a Luxury Firewood Exit

Leroy Hite built the world's first luxury firewood company. He started in 2013 with one truck, maxed-out credit cards, and a vision that everyone around him thought was either crazy or naive.

Eleven years later, he sold Cutting Edge Firewood to a family office in Atlanta. Along the way, he learned more about pricing than most business school curricula will ever teach.

I sat down with Leroy on The Price and Value Journey podcast, and what he shared applies directly to every professional service provider who has ever wondered whether their price is holding their business back.

It Started With Running Out of Inventory

Leroy did not arrive at premium pricing through a carefully constructed strategy. He stumbled into it and then paid attention to what he saw.

In the early years, when he was about to run out of firewood, his instinct was to raise prices to squeeze more revenue out of remaining inventory before it was gone. What he expected was a decline in demand. What he got instead was demand that held steady and, in some cases, went up. That kept happening. He kept raising prices, expecting pushback, and not getting it.

The real education came in 2021. Leroy ran the math on his cherry firewood and discovered that he had sold roughly a fifth of the prior year's volume, at double the price, and had generated more profit than the year before. Fewer transactions. Better margins. Less operational strain. More money. That was the moment the light came on.

Premium Pricing Strategy: Price Is a Signal, Not Just a Number

One of the more striking stories from our conversation was about a customer who found Cutting Edge Firewood because someone on Facebook said they were too expensive. The person asking the original question moved on. The person who saw that exchange thought, "An expensive firewood company? That must be quality." She became a customer.

Leroy's point is that price tells a story before a single word of your marketing does. When your price is low relative to the quality of your brand and the experience you deliver, you are sending conflicting signals. Confused buyers do not convert. They go look at someone else.

The inverse is also true. A high price, backed by genuine quality, does your marketing for you. People talk about it. They wonder about it. Some of them buy because of it.

Why Discounting Is a Trap

Leroy was relentless on this point, and it is one that professional service providers need to hear. When a marketing agency came in and started running sales without asking, he shut it down immediately. His position was simple: he would never run a discount or a sale, as both damage the brand and the margins.

The math is not complicated. If you have 50% margins and you offer a 20% discount, you have just cut your profit by 40%. Worse, once customers learn that discounts are coming, they wait for them. You have trained them not to buy at full price, and unwinding that takes years if it is even possible.

The short-term revenue bump from a sale feels good. Leroy compared it to a dopamine hit. The long-term damage is much harder to see, which is precisely why so many businesses keep doing it.

Pricing Changed His Psychology, Too

Leroy said that when your margins are thin and something goes wrong with a client, you resent fixing it. You are already losing money on the transaction, and now you have to spend more to make it right. That resentment acts as a tax on the relationship, and the client can sense it even when you believe you are concealing it.

When your margins are healthy, everything changes. Going above and beyond to correct a mistake is not painful. It is actually an opportunity. Leroy's team would send a box of premium hickory firewood with a handwritten apology note when something went wrong, rather than offer a refund or a discount. The customer received something worth more in their eyes than money, and their loyalty deepened as a result. The economics worked because the margins made them work.

Healthy pricing does not just improve your financials. It improves how you show up for your clients.

What It Did to the Exit

Leroy told me that he had no idea, when he was building the business, how much his pricing decisions would influence the value of the company when he sold it. He sees it clearly now.

Higher margins meant higher EBITDA. Higher EBITDA meant a stronger valuation. A premium, differentiated brand attracted a buyer who saw something worth acquiring. The pricing philosophy that Leroy built over eleven years was not separate from the exit value he realized. It was a primary driver of the ultimate valuation.

For those of us who are not planning to sell a business, the lesson still holds. Better margins mean more freedom to invest in your clients, your team, and your capacity. They mean less pressure to take work that is not a good fit. They mean you can afford to make things right when something goes wrong without counting the cost.

Price is not just what you charge. It is what you are building toward. Follow this link to listen to the full interview. _____________________

I’m John Ray, author of The Generosity Mindset. I help expert-service professionals communicate value, attract best-fit clients, and price their work more confidently, without confusing generosity with giving everything away. If you’d like to start a conversation or join the list from my Sunday morning email newsletter, send me a DM.