Portable Sanitation Association International


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WEEKLY EDITION SEPTEMBER 18, 2019 So You' re i n a Pr ice Wa r: N ow W hat ? (Part II of a series) By Karleen Kos, PSAI Executive Director Competition happens — there's nothing you can do about that. They are going to try to win business, and it might come at your expense. That's just reality. But you're running your company, not theirs. To survive and thrive, you have to make adjustments to what is happening in your market, leveraging all the assets of your own situation to neutralize the impact of their activities. If you do it well, you may even rise above them to create a new version of your company. So how do you do that? In short, don't panic. Diagnose. Before you can decide what to do when a competitor starts offering lower prices, you must first take the time to understand the symptoms that are present in your market. There are four main things you want to look at. Customer issues. In any price war, the main focus should always be the customers. Without a good handle on what makes them tick in your market, you'll be entering the price war with one boot off. Particularly look at your existing customers. How happy and loyal are they? How good is your relationship with them, and how price sensitive are they? If you have customers that have been with you for years and they are happy with your service, if you know the decision-makers personally, and if you've worked together on many projects to the mutual benefit of both your firms, you are in a strong position. In effect, you're holding a good hand at cards, and the only one your competitor has is price. If your customers are predominantly short-timers, if they balk at every minor price increase, and if they frequently complain about the equipment or service you provide, your position is weaker. They will probably be willing to talk to a competitor, and not just because of price. PAGE 2 CONTINUED ON PAGE 12

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