Rightly or wrongly, price is still the first factor individuals and businesses use to compare goods and services. Bearing this in mind, you need to constantly monitor the pricing of goods and/or services in your industry. It’s easy to check prices of your competitors in-person or online. Of course the price you charge will also depend on the quality of what you are providing. Can you justify higher prices for personalised goods and services? Do you provide extra services that your competitors can’t? On the other hand, if you are the low-cost sector of your industry, can you offer the basics with no frills or special services? Even an undercut of a few pennies can divert sales your way.

Competitive Pricing can be Affected by:

Direct Competition: If a your competitor is undercutting your prices and you cannot strongly justify your higher current prices, you might end up in a price war. You must avoid this if possible. Try providing something extra that your competitor doesn’t offer and adjust your pricing accordingly.

Location: When you are based in an affluent area, your overheads will mean that you will struggle to be competitive with some competitors. You need to compar e like for like in the local area.

Your Customer Base: Most markets have a price range dependent on the demographic group they are targeting. If your cafe is frequented by lorry drivers, your prices will fall at a lower range than if you are opening a fine restaurant in a trendy part of town. You must stay competitive within the price range for your clientele.

Technology: In some industries, if you have the newest technology, you can cut your costs.  If you maintain old practices, your prices could be affected. Therefore, keeping up with technology will improve your ability to maintain competitive prices.

Vigilence must be your watchword, always look around with fresh eyes to see a way of cutting the price of your product or services. Keep an eye on the prices of your competitors and be ready to move fast!