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Start by considering why a competitor has lowered their prices.
Are they new to the market and trying to distinguish themselves by offering the cheapest product or service? Are they launching a new value range because this is what the market wants or have they been forced to slash prices to try and boost dwindling sales? They might not have the same reasons as you for considering a price cut.
But particularly you can analyze deeply through those tips:
“Find areas where you compete favorably and put up a comparison chart on your website. Be explicit — assume that your customers know about your competitors.”
“When prices can’t be lowered, focus on the ways you’re ahead of your competitors in terms of quality. Clients care about price, but they care more about the quality of what they’re getting for their money. Customer service is also a key point. This, in many cases, is more important, and clients are willing to pay higher prices to have a partner, not a just a hired gun, working for them.”
“As our market becomes more competitive, we increased prices to help us tell the story of how we are different. When our prices were lower, it was harder to tell a compelling story. As the difference in price points became greater, we had the opportunity to tell a better story and we did. Our prices have increased as more and more low-cost competitors jump into the market.”
“Our competitors went free recently. There’s always buzz when people make sales or drop prices, but it eventually dies down, and the one with the better product or service returns to the winning position.”
5. Only Engage If You Must
“Competition is the ugly truth of business and sometimes it can get nasty. If a competitor is undercutting your price, then you need to react by further positioning your offerings as more valuable than others in the market. It is all about keeping your company on its own path. Racing to the bottom against someone setting the pace can easily end up with your business crashing and burning.”
“In these situations, companies have to clearly communicate what differentiates them. Apple did not panic and reduce all their prices as smartphone companies undercut them on price, because they differentiated themselves. When we think of Apple, we all think of high quality products and great innovation.”
“Engaging in a price war only harms your niche in the long term because it drives down profit margins for everybody. Stay firm on your prices and focus on adding value by creating more free content on your website and on social. Make help videos, write lots of great guest blog posts and share on social. Consumers will increasingly see you as a trusted authority which will justify your prices.”
“If you cannot lower your prices to compete, then separate yourself as the premium offer in the market. Invest in your branding and customer service to make it stick. If the market allows, then you may end up with the higher-end clients and higher margins than your competitor.”
“If you focus on price alone, you’ll never win the war. Focus on the value your product will bring your customers and why your product is what they need to become more profitable. This is worth far more than shaving off a few dollars for the initial investment. Remain true to the pricing structure you’ve set in place and uphold the real value of your brand!”
If your product's quality is same with what he offered then you will definitely face the problem soon enough to realize your clients have already dealing with them.
Though there are lots of considerations to take, the first thing that should come to mind is where did they get their raw materials, perhaps it's cheaper too.
Price reduction is a matter of discounting the product and or service that sends wrong signals to consumer and not wise to do so. If need be arise, we shall add additional value to the product / service we sell. Such additional value shall be appropriate to the product / service we sell and such addition should be made known to all prospects and consumers to understand the value addition. Consumer should really feels the value addition.
Even when situation arise to increase the price, still we can withdraw the addition rather increasing the price. Consumer will always feels quality as value for money paid for. Certainly quality can't be the value addition but expected minimum standard of the product or service we provide.
Agreed with Mr. Helal,
hanks for rinvite
Thanks for the invitation
Agree with experts answers
You have to examine the price of an Item
And trying to reduce the price
And to excel in the services provided
Many wonderful anwers are already here, nothing to add.
Nice, thanks for sharing ... ..
