There are no winners in a pricing war. There are only survivors.

We’ve entered a period of the economy where there are far too many companies setting their prices as low as possible in an attempt to merely cover cash flow. This is insane! You can’t price your goods or services at “cash-flow prices” and ever expect to make it. The only thing you’re doing is driving the profit equation so low that in the long-run, you will have zero opportunity to survive.

Yes, the allure of securing a deal is huge, no doubt about it. However, by eroding your profit margin to such an extent, you’re only forcing yourself to close so many more deals that you will wind up in a no-win situation. As hard as it is to resist, hold your pricing and seek to find a better “price-value proposition” for your customers. Talk to them and find out what they really need. You do this by not just asking questions, but by also asking still more questions and doing still more research.

Your solution may exist in not trying to find more customers, but in finding fewer customers who will pay you more. It’s a process that I call moving up the food-chain. There will always be those who feed on rock-bottom pricing, but you’ll be hard pressed to find many who can truly survive long-term with that strategy.

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