Pricing to please
Not everybody, but your target customers
“Can you do better?”
In any case, my smart-ass reply was often, “Better for you or for me?” Isn’t that the real question?
But that makes it a win-lose game, instead of a mutual benefit transaction. What price will satisfy both the buyer and the seller? Buyers want a price that compares favourably to their alternatives and delivers value to their business. Sellers want a price that exceeds their cost and delivers sufficient volume to be profitable to their business.
An acceptable price is defined by the market, the prior experience of your target customers with your competition. But the right price is a key strategic decision and must be consistent with your own prior choices for product quality, features, benefits and associated services. Price is an important strategic element in your market positioning.
Do you want the price to be the primary attraction to your business? Or is your product more unique and your customer more discriminating than that. If you win on price, you can also easily lose on price. Long-term loyal relationships are built on a consistent customer experience that confirms your integrity, expertise and business values. Price and availability are only the initial entry criteria.
You cannot please everybody, so use pricing to help select the customers you really want to do business with.
Be better. Do better.
Your Uncle Ralph, Del Chatterson
Join our mailing list at LearningEntrepreneurship.com for ideas, information and inspiration for entrepreneurs.
Read more articles at:Learning Entrepreneurship Blogs.
Click Here to check out Uncle Ralph’s books, "Don't Do It the Hard Way" and "The Complete Do-It-Yourself Guide to Business Plans" Both are available online or at your favourite bookstore in hard cover, paperback or e-book.