Strategic Planning

Strategic Planning

Why You Don’t Need the Lowest Price to Win More Business

Small business owners often fall into the dangerous trap of offering the lowest price to win customers. Unfortunately for some, this strategy can cause their business to fail and as a result they lose everything. On the flip side, there are many great opportunities for business owners who realize that you don’t need to have the lowest price to win the customer.

Why Price Doesn’t Matter:

Believe it or not, most customers shop for the overall satisfaction they will obtain from a product, service or experience, not solely based on price alone. Sure, there are some customers who will always go for the cheapest buy and that will never change, but in this day and age it is getting harder to cut costs, attract budget buy customers and actually make enough money to stay in business.

In order to succeed in a business that is not based solely on the issue of price, it’s important to have strong selling propositions that create an awareness of the unique aspects a business has to offer. This can include things such as:

-“Premium Services”: This is actually quite the opposite of a cut-price business. Premium businesses are generally more expensive than others and they succeed as they are able to portray an exclusive or premium image that exudes high quality. The decision to price your business as a premium requires market research to discover what price your market can bear and what is being offered by competitors.

Why Setting a Business Benchmark Could Save Your Business

Staying in control of your business is essential, and understanding how to set a business benchmark is a vital part of controlling where your business is heading. Over 50 percent of small businesses fail within their first 12 months of operations. There are many reasons for this, including lack of research, lack of funds, poor management and lack of understanding of business operations, but the real challenge is to do everything you can to make sure your business isn’t one of those statistics.

What is a Business Benchmark?

In the business world, a benchmark is another name for a business standard or goal that must be reached. It is an accepted standard and can range across a number of business areas.

Typical benchmarks can include monthly sales targets, minimum manufacturing output, minimum advertising results, monthly product return or refunds, or any other area of business that is measurable and can affect business profits or success.

How to Set Benchmarks?

Setting a benchmark is not always as difficult as it may first sound. The first step is deciding what you need to measure in order to ensure your business is operating in a profitable manner. This could be any of the things mentioned above or something totally different.