Saturday, June 17, 2006
An article in the Pricing Advisor: "Clients sometimes ask us, “How can we deal with dumb competitors?” You know, those companies who are aggressively moving prices down. Who are pricing below cost. Who will do anything to keep a piece of business. Who act as if no price is too low to win some volume. If this sounds like the market you’re living in, then you may also believe you have irrational, dumb competitors. Why are these firms so stupid? Our experience is that often irrational firms are not nearly as dumb as they appear: they are simply responding to moves made by other firms. If you’re facing what seems to be irrational competitive behavior, you should check your own behavior. You may be the problem! When confronted with competitive moves that seem “irrational” use the following questions to assess whether your own competitive strategy is the problem"... read the rest here. Our website has a great article on pricing against the Wal-Mart's here.