(Note: this is the seventh of a 10-part series listing my revised top 10 business planning mistakes. The list goes from 10, the least important, to 1, the most important.)
Are you thinking that it’s important to offer better service, or better products, at a lower price? Forget it. That hasn’t been true since the days of Adam Smith and microeconomics and selling lumps of coal.
For lumps of coal, yes, the lower the price, the higher the volume. But that means nothing to the entrepreneur going out into the market with quality goods and services. In the art of positioning, price is the first message you send, and the strongest message.
Markets like the high-priced, high-quality offerings. Don’t be cheap. Low price and low volume works for Walmart and Costco, but they have enormous resources, and you don’t. Price higher, and give more value. Offer high quality, and price accordingly.
Thank goodness this seems to be getting better these days as people become more aware, in general, of the magic of positioning and your price as the first message you send.
(Image credit: istockphoto.com)