What to do when your competitors drop their price

If your competitors drop their prices what do you do? Do you follow suit or stand firm?

In this post I’ll cover the situations where you too may consider cutting your prices, and when you might not!

Consider dropping your prices if:

1. Your costs have fallen
2. You have spare capacity or excess supply
3. Your customers would respond to a price cut by buying more
4. If you want to grow your customer base
5. If a drop in price won’t harm your brand image

Avoid price cuts if:

1. You’re facing rising costs
2. You’re experiencing excess demand
3. Your customers would be unlikely to buy more even if you dropped prices
4. Your brand is at the premium or luxury end of the market

Which situations apply to YOUR business?

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