Competing on Price (An Unsustainable Practice)
Stop undercutting each other.
Everybody out there is trying to make a name for themselves, but it can turn vicious. I see so many people bounce between getting quotes where businesses compete on offering the lowest price possible.
It’s crazy! The best type of advice that I have for you guys, especially when you’re starting out, is that competing on price is not sustainable.
Once you start to get bigger and you start to have more overheads, staff, resources, trucks, then you need to charge MORE.
So how do you charge more and still get sales?
Make sure your service has more value. Market how you offer a better warranty or have been in the business for 40 years – so you’ll be around for 40 more. It comes down to how you perceive yourself and how you present yourself to the client.
There are heaps of ways to be seen as a big dog in a very competitive world.
Start with the words you use and how you hold yourself when you’re communicating with the client. The quality starts with you and your proposal. I remember early on in my business I sent out a survey to my previous clients and I found out that 30% of them did not give a sh** about price. They just wanted to find the right brand.
Whenever you are giving out a proposal on whatever product or service you’re doing, give them the option of the:
- Budget saver
Offer the premium even if it’s something that you know might not make sense (e.g. it’s an expensive light fitting in a wardrobe that no one’s ever going to see). Some people out there just want the biggest and the best.
Don’t go fighting your rivals on price, it’s a race to the bottom. Stick to your price and communicate why you’re worth it. And I guarantee you’ll win the work.