You couldn't find someone to disagree with you, Greg, you so you import one of your own? lol
At least take it in context and include the rest of the post.
"Just MHO, but the value your customers see in what you do is influenced by their preception of how much you value it. I can see creating incentives, I can't see cutting prices on your staple services.
If someone needs what you have, wants what you have and values what you have they'll buy what you have. They can always adjust how much they buy to what they can afford. If they're existing customers they won't like gouging your living anymore than they like being gouged.
Luckily, I've only had two customers outwardly express a concern about the economy and the cost of cleaning. And, both suggested cleaning only the traffic lanes to keep the cost down without me saying a word."
Actually, I'm not so sure we're disagreeing.
Have your local independent dealers dropped the price of gasoline at the pump simply because the economy is tight while their cost remains the same? No. Are they intentionally taking a beating at the pump? No. When their cost drops, the retail price drops.
Retailers have sales, that's an incentive, and that's always been part of the program. Nothing new there.
What does your variable rate mortgage have to do with this conversation?
Did the bank switch you from a fixed to a variable because of the economy?
Is Verizon offering dicsounts to keep you? Last time I looked it worked out about the same regardless of who we use. The only difference are the temporary incentives to get your business. Good economy or bad, as competition increases they're forced to add more value to compete. This is nothing new.
Restaurants around here aren't dropping their menu prices. They introduce specials, like they always have, but regular menu prices haven't budged except to increase. Neither have the lines, we're waiting just as long to get a table as we always have.
Car prices are down, in large part, because now you have to do more than fog a mirror to qualify for a loan. And, the cost and commitment of an automobile is slightly more than the cost of a carpet cleaning, don't you think?
My point is simple. Our costs are not dropping. Sales, discounts and incentives are one thing, and we do that too. Dropping your price on the staple services that pay for the lights is an entirely different animal.
Cutting your price means everyone, whether they need, want or deserve it, gets a discount. You make less on every job. Every job. The economy doesn't effect everyone the same, why cut profits across-the-board?
So, that doesn't sound like a sound strategy unless you can also somehow magically all of the sudden manage to live on less. 92% of Americans still have a job. In the last 16 months only two customers have expressed more than a passing concern about the cost of cleaning. Even when we were cleaning in Florida in the worst economy I've ever experienced, we still found people who would happily pay .45/psf.
When some guy walks up to you on the street and says, "Hey, dude, wanna buy a watch..." you won't value what he's selling like you would when you approach a salesman in a jewlery store selling watches at ten times the price. While they're both automobiles, a Lexus sells for more than a Kia. Speaking of people still needing to eat, some steak sells for $4.99 a pound, some sells for $16.99. Services are no different. When you come in believing the value of your service is higher than that of your lower price competitors, and it's true, many of your customers will come to the same conclusion, too.
Whatever floats your boat, IMHO incentives and discounts make a whole lot more sense than cutting your prices.
I think people are hurting and should explore what everything they can so they don't have to get a job and can continue to work their business
