It is greatly difficult to keep the pricing strategy stable and efficient. How many times you went through a conflict with a customer over the price, with a risk of losing in case you don’t offer a decent reduction?
Your products are easily sold and the sales improve if you offer the customer a good reduction on the original price. Price reductions expand the sales and interest new customers in the short-term, but from a critical point of view, discounts can affect your business, the quality you provide and the net revenues.
Study the following points and ask yourself the below questions before considering any price reduction:
1. How many times your goods and services are sold only because of a discount?
2. The reason behind the reduction
3. What would result from refusing to make a discount?
4. The reason why the customer needs a discount.
5. Did the customer convince you about the discount?
6. Will the discount change the sales presentation you have made?
7. How much the discount is costing you and your business?
8. Did you have to take out anything from the offer to avoid low revenues due to the lost price?
9. How will the discount affect the benefits of the customer on the long-term?
10. What will be the reaction of other customers when they find out that they did not receive any discount?
11. How are you going to be affected if you stop making discounts?
12. Will the deduction interest the clientele who cannot afford the original price?
13. Are you putting too much effort and wasting time on the new customers who ask for a discount?
14. Is your search procedure selecting the wrong type of chance?
15. Does managing the sales need a drop on the price arrangements?
16. How can Marketing decrease the price reductions’ argumentation?
17. Is the product you are selling not organized properly to raise its price?
18. The deduction on prices covers all the items equally or not.
19. What is adopted as trend when it comes to discounting today?
20. What profit can the company benefit from without discounts?
You will never understand the negative impact discounts can have until you and the company explore the why behind the culture of discounting and its consequences.