How can you maximize profits when everyone is racing to the bottom of the pricing scale? Consider the value you can offer beyond quality, service, and price.
Let’s step back from this for a minute. We practically expect this kind of behavior because we’ve become so accustomed to this type of price-shopping consumer. When a new prospect calls or comes in and starts off with, “What’s your best price on...” you need to be prepared to defuse it once and for all. This type of question sets a defensive stage from which few recover.
The old buy-low, sell-high mentality is still with us. When times get tough, it gets even worse because neither the buyer nor the seller knows how to create a better alternative. For any economic transaction to work, both parties have to be satisfied. Buyers want the most for the least. Sellers want to deliver with the least amount of cost and effort for the highest possible selling price. The objectives of both oppose each other. But it does not have to be that way.
Where printers get into trouble is the itemization of each part and parcel of the job. When you break out every item, you enable buyers to negotiate for each and every one, and they will. The seller feels nit picked to death and comes away defeated and demoralized. The vendor wants the job, but by the time they’ve given in on each of the itemized points, there’s nothing left. The result is working for nothing.
Change your point of view
Some very powerful techniques can allow you to regain control of the situation and your margin, while at the same time satisfying the client. I learned this technique from a close friend of mine who built a $30-million business selling to WalMart and, in the process, learned a thing or two the average company does not.
To begin, this company offered three distinct price levels for their products. The first was the very basic, low end, entry level. Very, very low margin, but high volume—essentially a commodity. We’ve heard all that before. There was nothing special here, except they established the bottom of their product offering. There was very little difference between their product and that of their competitors. It was branded, but other than that, it was pretty much the same.
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