Price Comparisons Can Be Dangerous

Price Comparisons Can Be Dangerous

I’m sure you’ve heard people talk about the dangers of comparing yourself to others.  This can play mental games with us. The proverbial keeping up with the Joneses… We celebrate, as a culture, uniqueness and creativity, and yet… there is an element of sheeple going around. When we get into business,  what do we do? Base our pricing on the pricing of other companies around us….

I have clients in a big town in the Rockies.  When I researched pet care facility pricing in this town, because I do ad hoc pricing studies, I found that almost 100% of the dog daycares were priced EXACTLY the same.  This is fascinating! I do understand the desire to not stand out too much, because I did the same thing when I first opened my doors. And maybe one of the reasons is to not offend other business owners who have been doing this longer than you. Maybe it’s because we don’t want people to say no to us, because we are too expensive. I’m not exactly sure what the reason is. It’s just something that is common in our industry.

BUT. And it’s a BIG BUT. Hang in there with me. We are comparing OUR pricing to other companies who based their pricing on comparing to someone else… It’s a big circle of comparison… but based on what? It’s not necessarily based on value provided. Or based on an amount that will not only take care of expenses, but also give the owner a really nice life. It’s based on an underlying comparison of everyone UNDERVALUING their offerings.

Is your pricing based on the type of clientele you want to attract? Is it based on what it will take to successfully run your business, and profit? What about the value you provide for the people paying you to care for their pet?OR is it based on a survey of other facilities in your local area?

I am the highest priced facility, by far, in my area. I’m even higher than some super swanky facilities in the high income areas to the north of us. And it has not stopped them from coming.  Because we deliver the value that the people are paying for.

If you want to sell your services based on the low price value, go for it. I can guarantee that you’ll be paying more payroll, because to make more money, you have to have more pets come through the door (that is, if you are running what I would consider an ethical business, with good dog/staff ratios).  I prefer to do it in a simpler way.