How to Set Your Computer Business Pricing

“The other shop can do this at a lower price.”

“If you drop your prices, you’ll have more customers.”

How many times do you hear these statements from your customers? If you drop your prices then more people should flock to your shop. It’s an excellent move, so you think. And this might allow your business to stand out from your competition. Especially if there’s a significant slowing down of computer repair work.  If your services are too expensive, it will be hard to attract clients. But if your services are too cheap, people may wonder if you’re cheating on your services.

It’s understandable if your priority is to maintain your customers. But can you achieve this by slashing your prices?

The Risks of Low Pricing

At first glance, lowering your service charges may give you an advantage. But if you dig deeper into it, there are pitfalls. It’s true that how much you charge for your service is part of your marketing strategy. But pricing is not a sustainable advantage. First, your competitors can copy your prices or lower their prices anytime. If you compete on pricing, there will always be someone else who’s willing to reach rock bottom faster than you can. And here are other risks.

Impression of poor quality. If your price is too low compared to the next highest competitor, it can cause concern. Your potential customer will think that you aren’t doing something right. Or that you won’t be staying in business for long. When something is cheaper people tend to wonder if you are cutting corners and that your service is of poor quality. Whereas having higher prices makes your customers think that you give much more.

Less profit. Lower pricing brings less money into the table. It forces you to operate on a low budget. Still, you may think that the volume can make up for the lost revenue. This can become a self-made trap. Your business is then pushed into a corner. You become ridiculously busy with the sudden surge of clients.

But for some reason, your income does not improve. It turns out you are attracting customers who want your services for free. Now clients who can pay more are going someplace else. Soon enough you can no longer afford basic advertising. In time, you can’t afford some of the basics you need – better equipment, office space, or to hire necessary help. This will eventually put you out of business.

Promotional discounts. If your service charge is already on the edge of practically giving it away, then giving discounts can be a big problem. Offering seasonal discounts can be used to increase sales. But even if you are able to pull it off, it can become contradictory. Your customers will think your price is not the lowest you can give. They can then ask for bigger discounts long after your promotions. This is a sure way to get to the bottom of the market ladder and eventually fold your business.

Change Your Pricing Strategy

Your edge should be the quality of service you offer. It should be your expertise that makes the difference. But you may need to change your marketing approach and it should be competitive and sustainable. You should highlight how your product or service differs from your competition. You can base it from on skillset or even use your insurance coverage as your advantage. It can be many things, but it shouldn’t be price.

As an example, you can use a different pricing strategy. You can set a regular pricing for your basic services and then you can offer discounted bundled services.

Your Way of Doing Business

The most important factor in your pricing is your business mindset. The idea of “any work is good” can be harmful to your business. While it is noble to try to extend your services to everyone, you should also be selective of customers you’d want to do business with. They should be the type that are profitable and can sustain your business.

Customers who do not value your business think that your service should be quick and cheap. These are the kind that want to pay the least amount of money, and demand the most amount of your time. Doing business with them takes your time away from profitable customers.  If you sense that you have this kind of customer, politely point them to another shop. But be mindful not to put down your competition when defending your pricing. Let the customers figure that out.

Here are some other ideas that you can use as your competitive advantage:

• Invest in marketing. That higher markup for your services is good for advertising. With the popular use of social media today, it’s now easier and cheaper to reach more people in your market.
• Open shop on Saturdays. Even if it’s just half of Saturday. This will allow you to accommodate those who are working on weekdays. If you’re the only shop that opens on a weekend, then it’s definitely your competitive edge.
• Adjust your work hours. Instead of doing business 9AM to 5PM, you can do business at 9AM to 6PM. Or whatever schedule that works. That extra one hour can make the world of difference to customers with a 9-5 job.
• Offer expedited service. You can arrange for same day pickup for basic services such as virus removal or pc tune-up.

Don’t be the first to devalue your services. Your customers will pick on that and follow suit. You want to work smarter rather than harder. If your competition decides to work for peanuts, let them. But for you, it’s important to stick to your sustainable business strategy. You may be charging a little higher than the other shops, but the excellent quality and convenience of your services will make it worth every penny you charge.

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