While it’s true that every new business should not start off by selling at a high price, it’s also true not to cut your price and sell at a mediocre price.
Contrary to popular opinion, price-focusing and price-cutting for any small businesses, especially the newbies, is the road to ruin. Well, I don’t mean should go ahead and hike your prices. NO! I simply mean that price shouldn’t be your main focus and reason that you expect to have more preference than your competitors.
When you’re at the start-up phase, it’s also important to have enough confidence in your quality services and products and be sure that potential customers can’t get the same quality elsewhere at even cheaper rates.
Here are 2 tops reasons to never put the price as your priority in business:
2 Top Reasons Price Shouldn’t Be Your Main Focus
Have a Great Understanding of who Your Ideal Customer is
One of the basic steps before commencing a business is to invest a quality of time in knowing who your target customers are and what their needs are. When you spend some time to understand their interests, satisfying them becomes easy. If you sell shoes for instance, and you realize that a particular area demands more shirts or underwear, you can analyze your orders and decipher which part of your target location has the audience for your product.
Create quality products for the right customers, who are willing to pay your price, and watch your business grow.
Place Focus on Repeat Business and Retained Clients
As a business, you should also spend enough focus and time on maintaining your existing customers.
Do you remember the 80:20? We 80% of our energy on getting newer customers, while the remaining 20% on existing customers. In fact, what this rule proves is that we tend to use a 20% energy to maintain and grow 80% of our existing customers. Very poorly!
Yea, I get it – you should expand your business and put it out to a new market by offering a competitive price for all services. This does not mean you should put all focus on getting new customers. On the other hand, your existing customers should not be abandoned too. How this works is once you have customers who are happy with your services and ready to pay for your quality delivery, ensure to do everything you can to keep them coming for more. What’s more, existing customers are easier to lure and they promote your business better with more testimonials and referrals.
Experts say that it’s not your low price offer that differentiates you from your competitors or keep you ahead of your game. Price-focused customers only stick your business while your offer is the cheapest in the market. When another cheaper comes into your niche, they switch fast as the wind.
Keep up with quality and good customer management relations. Then, you’ll attract more customers who want quality and not a low price.
As a small business, setting prices as your number one priority gets you nothing. It’s the fastest route to an end! Instead, focus on quality and delivering decent works. Nevertheless, don’t put prices too high as well.
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