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Being the Low Cost Provider

July 10, 2012

There can only be one Wal-Mart. There can only be one lowest cost provider in the market.

If you think that's you, then keep it up until everyone keeps racing to the bottom and no one is making money. That's the only result that can happen from that race. You have to provide value. Value will get a customer every time. You need to be able to justify your price being higher than anyone else because of the service and extras you provide. But if you absolutely need to think about being the lowest cost provider, then I urge you to change your mindset, not your prices. Think about that for a second. Keep your price exactly where it is, but switch your mindset. Your price is the absolute lowest for what you provide. Yes, your customer may be able to go down the street and get the product itself for a lower price. But when that other company adds in the services that you provide, then the total cost that your customer has to pay is way more than what your price is. That's why you need to work on value-added selling. You need to be able to look into your customer's eyes and convince them that you are the absolute best price for what they are getting.

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