Just the other day, yet another customer said to me, “I just lost a big contract on price again; perhaps I should reduce my prices when I quote.”
That’s just plain wrong!
What has happened is the customer was not convinced that they were getting anything better or extra for the higher price quoted.
People buy differences and perceived value, don’t believe me?
If you know a bit about cars here’s an analogy.
In the UK there are on the many cars on the market, 3 of them are:
The Audi A3
The Volkswagen Golf
The Skoda Fabia
The Audi is the highest price vehicle and the Skoda the lowest and the Golf sits at the middle price band.
The Audi is predominately bought by the young professionals or those aspiring to that image.
The Golf is most often bought by those people who want good reliable, stylish vehicles, which hold their value at a reasonable cost.
The Skoda’s market is often retired or middle aged people who want a vehicle that is reliable and budget priced.
If everyone was only interested in price we would all be driving a Skoda.
What people buy is the difference between your product/service and the competitors. If you don’t convince them of the additional value added benefits of your proposition then the decision will be made on price. That probably means they will not buy from you unless you drop your price.
There goes your profit margin…, and interestingly enough, the people who buy on price usually show no loyalty in the long run, (and take longer to pay). If you gain business on price, then you are likely to loose it on price.
Remember there is always someone selling a cheaper and more inferior product or service than you and that sort of customer are his rightful prey.
Don’t ever apologise for being more expensive, be proud!
For more information about how simple techniques could help your business e-mail me or visit my website today!
Alan Briggs
Dynamic Business Strategies Ltd
Tel: 07917 446068
E-Mail: info@dynamicbusinessstrategies.co.uk
Website: www.dynamicbusinessstrategies.co.uk
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