When To Lower Your Prices

Last time we looked at when to increase your prices. Today we’re looking at when to lower your prices. ‘Why put prices down?’ you may ask. If you evaluate your range of products and services sometimes cutting the price is the right choice. You might choose to do so in the following circumstances:

To build market share

If you are a new business or you’re entering a new market or launching a new product you may consider keeping prices artificially low to encourage people to buy from you instead of the competition.

Value is lower than price

If the value of your product or service has fallen; increased product choice and the economy are just two factors that can influence this, then you may need to drop prices in order to bring price and value back into line. The alternative is to find a way to add value to your product or find a new market for your product that is willing to pay the current price.

Excess Supply

There are times when business is slow and sales drop off. In this situation you may have excess supply and need to boost sales. You can either implement a permanently lower price or try a sales promotion.