Want to Get Away From Price Competition? And Being Broke?
Warren Buffet says that the number one driver of profits is, and probably always will be, price. If you do not have anything that you can truly hang your hat on that distinguishes your business from your competitors (and just saying and thinking “we’ve got the best customer service” doesn’t count- if you look around that’s what everyone says who doesn’t have a good uniqueness or doesn’t know their uniqueness), so if your prospects don’t clearly see a uniqueness in you, there’s going to be only one way that they will be able to distinguish you from your competition: through prices. Now, companies that compete on price alone are usually run by owners who are very stressed out and usually quite unhappy. There’s good reason for this. In almost every instance, companies that compete on price are going to have the following characteristics: They have very slim margins and therefore cash flow is usually a stressor for the business. Because they have slim margins they also are under staffed, causing more stress. And a result of these two is that they’re usually not very fun companies to work for, which means a lot of times they’ll also have trouble with turning over employees, recruiting great employees, or keeping good employees. The long and the short of it is that it’s just not very profitable, usually, or very fun to compete on price.
How Do You Avoid Competing On Price?
So, the question is what do we do to avoid competing on price? Well, there are a couple ways to accomplish this either when starting your business or in order to build away from price competition. First, you have to have something that is either unique, or a unique way of offering what you do have. Let’s deal first with having something unique. This means having the most of some product or service- one of our clients carries the most cross country skiis in the country in their retail store, or it can be the best service- be careful with this one though, remember everyone claims this, so make sure you communicate something that is really unique about it, could be the best ingredients- think of Papa Murphy’s take and bake pizza franchises- they market that they use the best and freshest ingredients, it can be most convenient- one of our clients services snow plows 7 days a week- which can be a huge deal to people who own snow plow companies and their trucks break down on a Sunday, it can be a unique solution to something- one of our clients figured out how to fix pool leaks and developed a product around this solution and is now the market leader in the world for this simple solution, it can be the highest quality, the longest lasting, the most prestigious like Bentley or Tiffany’s jewelry, it can be that which is the most current trend or fad, or it can be the biggest, best, most of you fill in the blank- whatever your customer cares most about.
How You Offer What You Offer
The other way in which you can differentiate yourself from your competition is through how you offer what you offer. In other words, maybe you don’t have a product or service that truly is unique from the next guy. Maybe it’s all pretty much the same. Well, you don’t have to give up there. You can create uniqueness around how you offer your products or services. In other words, you have something like a powerful guarantee- one of our clients owns a custom cabinetry business and we developed a powerful lifetime guarantee around their product that has helped them close a lot more sales, or unique packages, or you will go to their homes, etc. By developing a unique offering, you can make it so that your customer looks at more than just the price when considering which company to buy from.
So, set yourself apart by creating some uniqueness. Sometimes this can be tough work, and this is where a great business coach can really help. But be sure to do this work so that you’ll make your daily work in your business much more easy and profitable by not having to compete on price. So, let’s take action and make it happen.
P.S. If you struggle with creating uniqueness in your business CONTACT US TODAY. We may just be able to help you come up with some great ideas in your Complimentary Coaching Session! 651-243-0070