If you're competing against a Big Box which features cut-rate prices, be sure to offer good deals to your customers. But your financial model might not let you be competitive on every single item. So shoppers could start asking questions about your prices.
Here's a reminder of some of what Art Freedman advises in our book, Making Money Is Not Illegal, Immoral or Fattening, about responding to those questions:
"What if customers ask you why your prices are higher than at the competition? Well, first of all, realize the customers expect prices at the high-convenience, world-class-service, small to midsize retail business to be higher than at the Big Boxes. Even when we're priced below the Big Boxes, we get no credit for this. They will think our prices are significantly higher than at a Big Box. So I say, why disappoint them?
"But answering questions about pricing is another place where scripting for the floor staff and cashiers is helpful. Here's what I suggest as an answer. 'Thank you for your input. I'll let my manager know what you've said. I think you'll find that our prices are fair and at where we need to be to offer the services for our community.'
"The problem you have here is when you do not execute on what the customers' expectations are. They will pay a higher price if there is value attached to it. If your customers are complaining about your higher prices, maybe what they are saying is, 'I would pay a higher price in your store, but I do not see a benefit to doing this, so I may as well shop at a Big Box.'"
In using the scripts and in meeting customers' expectations, staff should improvise so it comes across to the customer as genuine, not wooden.
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