Have you been losing business and wondering if it’s because your price is too high?
I beg you to take a step back and take a close look at your book of business before you go tinkering with your price points.
Because, in most cases, your price point is perfect just the way it is.
Yes, the economy is a bit rough and tumble lately and yes, people are shopping for the best prices whenever they can. The truth, however, is that most businesses are loyal – even during rough times. I urge you to take a look at your customer service team and how they interact with your clients, even if your customer says he is leaving due to price.
In many cases a customer or client will tell you that he found a better price (whether he really did or not) because it’s easier to say than, “I’m unhappy with you because of xyz…” Unless you had a very serious falling out, most customers leave without expressing their concerns. They feel as though it’s easier to move on to another organisation than it is to “cause a conflict” by registering a complaint.
I’ve found through my own research, and have seen several other salesmen recommend as well, that you should not change the way you price your products unless you can objectively prove that you have lost at least 10% of your book of business because of price and price alone. If a customer leaves, do a little digging. Check his file to see what his relationship has been like with your customer service team; call him and ask him if there is anything else you could have done to save your relationship.
Listen carefully to the answers. It won’t be difficult to determine whether or not price was the real issue at the end of the day. If it was – then go ahead and work with your marketing team to alter your price point a little bit. If not, take a step back and figure out how to prevent further losses due to bad business relationships.