Pricing in Hard Times

[Ken]

Holding steady. As others mentioned, increasing cost of supplies is a factor.
When things are slow it is a good time to add a new process/product to your output.
This gives you time to learn the new machine, target market as well as allowing you to streamline your work flow, organize the workspace etc.
Cheers!
Ken

 

[jiarby]

costs going up, prices going up.

2 trillion bux injected into the money supply means a buck buys less.

I am in a shopping center with a grocery store. EVERYTHING costs more. Bread is 4 bucks a loaf, I even saw a $5 box of cereal! Orange juice is 89oz instead of 96oz. 39oz coffee is $9 so they shrink the can to 24oz for $6. Coffee use to come in 16oz or 32oz cans. It was sold by the pound. Not anymore.

So, I use the grocery store model...

ALL NEW!
Eco-Solvent Printed "Green" Banner...
3x8 banner at the OLD 3x5sqft price (which is now 25% higher). 3 SQFT FREE!!

So, we give 20% more banner (18sqft) for 25% more money.

Oh Yeah...
You need a bio-degradable paper bag to hold it (from U-Line) right???
Cha-Chiing! Add-On Sale.

Or, we can sell you a heavy-duty 3" banner tube designed especially to hold the banner material (see, it says "Oracal" on the inside!)


So, I am finding the customers are seeing prices rising everywhere in their lives, making this a great opportunity to increase your margins without any real pushback.

Just shrug your shoulders and say "It's the Economy!"

 

[Alphonse43]

I'm with Fred, certain return business is looked after, others are selectived. Most big business here in Melbourne are in trouble and reducing their prices. New cars are being sold with "NO INTEREST" finance over the period of the loan. Clothing at 50%-60% off. Food prices are through the roof (We are in the worst drought Australia on record). Water bills are set to double in the next 3 years The Aust.Goverment has given $1,400 for single pensioners & $2,100 for couples, each eligible child will receive $1,000 (Families that currently receive tax benefits) This money has been given to people in need, to be spent at Christmas and support small business & the economy. Self funded retirees have seen their Super crash and are not spending at all, people in general are only buying the essentials, it's the government's way of trying keep it all ticking over. I don't see a lot the funding being spent on signage for a while yet.
Alphonse43

 

[Craig Sjoquist]

I ride my bicycle to do my jobs, most on site .... I'm filled up at this point, .... if anything I'll raise my prices and keep to what I say or close, as always

 

[jiarby]

They guy that sells cars is in trouble. The guy that FIXES cars is going to do well!
Overprices clothing is 60% off, but still 20% higher than what it should be.

People are more conscious of getting value for their money. Deliver a good value and you will do well.

On the side...
How can I get my shop declared a BANK so I can get some of the KaBillions or Bailout Money like AMEX is doing???

 

[Fred Weiss]

On the side...
How can I get my shop declared a BANK so I can get some of the KaBillions or Bailout Money like AMEX is doing???

Easier to incorporate as a city and get in line with Phoenix, Atlanta, Philadelphia and others now queuing up for their bailouts.

 

[FrankenSigns.biz]

I have a retail location and we offer products to individuals and business to business products and services as well.

We are taking a hit from both sides. Vehicles wraps are down. Walk-ins are down. Sales commissions are down. People seem to be pinching nickles. We are considering lowering prices to boost sales. This is not an easy decision.

 

[jiarby]

If you were losing sales over price I might agree... but sales are down because people have quit spending money, or are at least being more cautious about what they buy. (not because your price is too high)

Lowering prices now might just mean that you are making less money on the sales that you do make rather than increasing the # of sales you make. We are not in a normal free market economy right now. People are very jumpy about spending money.

Try building value rather than cutting prices... offer a free or discounted banner with a wrap, or a couple coros with a banner... something to sweeten the pot and make your deal look more attractive. The customer is buying visibility from you ....so give it to him! Even a fistful of bumper stickers can close a deal for you faster than a few dollars off.

Cutting price tells the customer you were charging too much to begin with. But a '50% OFF Banner Special' may bring in traffic. Think like the Pizza guys... Buy one Get One Free (pay regular Menu Price)
The thing is that the menu price is twice what they regularly sell a pizza for.

 

[Marlene]

prices with us have reflected increases in what we pay and that's about it. substrates like Dibond and Alumalite have gone up over the past year. we mark these thing up rather than have a set price.

 

[Checkers]

Yes, business has slowed and I still gotta eat. So, there's no better time to promote your business.
My prices have kept up with inflation and supplier price increases (gotta love estimating software). However, I am promoting a 15% discount through my website on all orders.
I am debating on taking that down and doing some sort of mass marketing. I hate the thought though, because I prefer to pick and choose my cllients.

Checkers

 

[gtjet]

My prices definitely are influenced by the economy. People out here are very conservative, and there is just way too many people in the sign business, as well as businesses that do some aspect of the sign business as a sideline. My customers are pretty loyal but if they were to feel they were getting taken advantage of I would lose a number of them so I have to stay reasonably competitive.

 

[jiarby]

When times are FAT and customers are everywhere then anyone can make money in almost any business.... It is when times get lean that you can separate yourself from the pack. People are still buying whatever it is you are selling, but there are just fewer of them. You have to go out and hunt them down... Marketing.

If your marketing plan is to turn on the open light, unlock the door, and wait for the customers to start rolling in then you are going to be in trouble. I call that the "Whale" marketing plan. Swim through the ocean with your mouth open and scoop up the plankton that happens by.

These days you have to be a "Shark". Aggressive, fast, and never sleeping. You have to go hunt your customer, even outside your normal territory.

Pour on the marketing, and be aggressive tooting your horn to let customers know who you are, where you are, and what you do.

 

[wildside]

People are very jumpy about spending money.

Financial markets are showing a 2.65% decline average nationwide on retail sales for the year...the media likes yelling fire into a crowd......

 

[jiarby]

yeah/ is a 3% decline in sales going to crack anyone??

 

[THATgirl]

In this economical mess a couple of commercial realtors that I have been making signs for, (for over 30 years) have told me how little some other sign shops are charging for corex signs. For one realtor, I lowered my price to fit his budget by 5% two times. The other realtors I did not lower my prices as the quotes they are getting are ridiculous. For my old loyal customers there will be times when I will give them a break. I do have to mention the customers I give a break to are also the people thru the years who have given me many great tips. Often over 100.00.

 

[synergy_jim]

3% declines in sales only crack people who do the high volume low price model.


when you operate on a 10% margin 3% is a big deal....


If you operate @ 50%, who cares about 3%

I think the media full of it and is very good at making news if there isn't anything good to talk about...

 

[JimJenson]

3% declines in sales only crack people who do the high volume low price model.


when you operate on a 10% margin 3% is a big deal....


If you operate @ 50%, who cares about 3%

I think the media full of it and is very good at making news if there isn't anything good to talk about...

Actually, 3% decline in sales of a company that operates on a 10% margin turns into a reduction of total profit .3%

A 3% decline in sales of a company that operates on a 50% margin is about 1.5% reduction in profit.