An aggressive low pricing system is not the answer to your quest for rounding up more sales and having an advantage over the competition. Most of your competitors are likely to be already bigger than you. So merely reducing your price and running on quick turnovers, doesn’t automatically guarantee you victory over them.
As a small business, making profits is essentially key to your survival. While I would not argue that undercutting price is always ineffective, I would also say there are more effective ways to outsmart the competition and book a place at the top of your industry.
Unless you have some serious financial backup plan, running an undercut pricing system as a small business is not ideal. I would suggest the following tips instead.
Solidify your product quality
Take it from me, quality products always justify the prices placed on them. Even if you decide to sell your product at the cheapest rate in the market, customers would still prefer to pay higher prices in exchange for better quality. So my advice would be for you to take your eyes off the price, and work on improving your product quality.
If you are wholesaling or retailing a product produced by someone or a firm outside yours, consider recommending an improvement in quality to them. With a higher quality and a moderate price, you would have everyone lining up to do business with you above the competition.
Improve your customer service techniques
Customer service is the act of taking care of the customer’s needs by providing and delivering professional, helpful, high-quality service and assistance before, during, and after the customer’s requirement are met. It covers the needs and desires of the customers. A good customer service knows customers by name, adheres strictly to the code of professionalism.
Treating your customers well ensures they come back, and repeated sales is key for business growth. When you treat your customers well, you gain their loyalty in return. And when you gain their loyalty, they would never consider the competition above you.
Consider marketing your business online
Traditional marketing strategies are usually phasing out. The internet has become a crucial part of our existence as humans, and billions of people use the internet daily. There is a limit to how far your traditional marketing can go, but this is not so with online marketing.
Internet marketing gives you access to numerous audience. Businesses are expanding and exploiting online platforms. You want my advice? Don’t be left out.
Relocate, if you have to
Hey, don’t deceive yourself. If your current location is not suitable for your business, relocate. You cannot stay away from the market and expect to operate at the top of it. You have to be in it, to lead it. I like your belief and optimism, but there is really no point staying there if it is not suitable for your business.
Setting an interior decoration business inside a kids’ school – does that make sense to you? Take your business to where the customers are. Business is a serious endeavour and should never be left to chance.
One key to business success is to know what your customers want. You are in business because of them. So here’s the deal, from time to time, get to find out what your customers think about your products. Provide an avenue where they can recommend areas of improvement to you.
You are serving them, so you might as well give them the opportunity to tell you how to serve them better. I have often provided feedback, only to find out it was never used. You should never do that, it is a quick way to lose customers. When you request for feedback, be sure to use it. It shows commitment to better efficiency on your part.
Convert your customers to sales ambassadors
Using your happy and satisfied customers to promote your business is sure to yield results. Engage your customers on social media, show them how much you care. Reward them for their loyalty from time to time.
Once a customer is satisfied, have them write you a recommendation. Gently request that they tell other people about your business. Offer them discounts. Make them feel like they are part of the managing board of the business. Know them on personal levels if possible. Know their needs and see how you can meet them.
Pay particular attention to the ‘big boys’. By big boys, I am talking of big clients. These customers offer your business some level of credibility and an opportunity to do business with other ‘big boys’. The trick is to treat every customer with care. See every customer as a potential sales ambassador, and work at it deliberately.
Consider loans, they may help you expand
Your chances of doing better than the competition remains slim, as long as they are larger than you are. Larger structures have a way of attracting large patronage. So you have to consider expanding.
Explore the market, look for needs within the market that you can fill. This will establish you as an authority. Before you are seen as an authority, your business structure has to expand. And expansion implies more funds.
Notwithstanding this, seek expansion, this ensures that you stay on top of the market far above the competition. Plan for growth, and if your current financial muscle cannot cater for it, go for loans. There are lots of private institutions like Merchant Money and public institutions that are willing to provide loans for SME businesses. The repayment method for loans to SMEs are usually flexible and suit the customer.