Is it best to be the cheapest or to be the best?
If you type in the word “cheapest” into any search engine you will be presented with millions or results of web pages vying for position as the cheapest flights, cheapest Disney tickets, cheapest hotels etc.
Is it good to run your business as being the “Cheapest service”? Well I personally don’t think so, but there seems to be a huge market out there for this.
The problem with competing on price is that if you are not cheaper than your next rival then you have no place to go other than to go yet cheaper still and so on.
Alternatively, if you compete on quality or the best service then so long as you deliver an outstanding service and/or quality products and services then customers will not only return to you, but they will also recommend business your way too.
Just food for thought for those business owners out there with the age old dilemma of trying to compete with the other businesses in your sector or in your street.
I will give you an example of how not being the cheapest can work from experience on one of my businesses.
Our assessor went to see a potential new client who were considering 4 other companies in addition to ours. We were well prepared and we showed that our set up was obviously much better than our competitors – the reason I know this is because we got the job and we were some £100 per week more expensive that the rest – these people were prepared to pay an extra £5,200 per annum more to get a professional quality service.
So providing the cheapest prices is not always the best in business.