The Bargain Hunter’s Mindset Affects Your Bottom Line
It’s hard not to shave the dollars off your prices when you’re competing for a job or a sale. When you want to win a customer’s business over your competition, putting a low price tag on your service instead of improving the quality of your product is a quick fix that will seemingly nudge you ahead. However the bargain hunter’s mindset rarely pays off in the long run.
Discounting the cost of your product or service to a shockingly low amount may bring in more sales from time to time. However this decision is rarely worth the long-term cost to you as the business owner. Unreasonably low payment for your time, services or product means that you and your staff will be working twice as hard to make twice the product for the same amount of revenue. You may have won the business, but if you’re not making the right profit for your energy spent, you haven’t won at all.
Zellers’ slogan used to be “the lowest price is the law.” Let’s take a moment to note that Zellers is out of business now. This is because the big box store mentality, expecting prices to be rock bottom cheap, is a dead end for good business and fuel for a weak economy.
You also can't deny that your employees are the life of your company. If you’re not charging enough for your products or services, or are trying to put too much in your own pocket while they work to make everything possible, you aren’t paying them a good enough wage to keep them engage as an integral part of the business. When you have to continuously shave dollars off of their rate, you aren’t encouraging them to do their best for you – which in the end can also result in your products and services being devalued.
Skilled professionals, such as veterinarians, accountants, roofers, writers, designers, brokers and the likes have invested years in their education to get the in-depth knowledge required for their field. This kind of expertise, which those that hire them don’t have, took time, money, and energy to develop.
Discounting these services sets the standard lower, as well as lowering the expected average price in your market. When prices are set at rock-bottom, trained experts in any field will have to invest less time in order to meet the cost expectations of customers – which isn’t good for anyone especially when you're paying for a product/service - Don't you want the best in what you're buying? Skilled experts who have worked on their trade for years don’t want to give you less than their best, and your customer certainly doesn’t want low-quality service.
Selling products and services at bargain prices forces business owners to go overseas for products, and to outsource work in order to make any profit at all. Which leads to economic issues within the entire country - So the next time you’re shopping locally, make sure you’re supporting locally as well. Ask for Canadian made products and though it might not be rock-bottom cheap, hire locally before working with others going overseas. The saying “you get what you pay for” exists for a reason. When you pay the honest worth for a product or service, you can expect the best. Most importantly, when you pay for a service instead of entrenching yourself in a “bargain” mentality, you actually give yourself the right to ask a trained expert for the best of their efforts - You can also expect others to pay the honest worth for your products and services in turn.