Thursday Links: When To Cut Prices

Posted by: John Tozzi on January 21, 2010

Lower prices during a recovery, not a recession, Susan L. Reid writes at Small Business Trends.

Caron Beesley explains tax changes that affect small business at Business.gov.

Health care reform is now nearly dead. Sen. Olympia Snowe (R-Maine), who spent months in a bipartisan group drafting one of the proposals but ultimately opposed the bill, says it’s time to “go back to the drawing board and try to see what essentially could be a basis for consensus,” David Herszenhorn reports at the NY Times Prescriptions blog.

Harvard Business Review blogger Umair Haque argues that businesses need to scale their ambitions, not their operations.

The venture capital industry urges President Obama to create a “Clean Energy Deployment Administration” to help finance the commercialization of clean technology. A PDF of their letter is here.

A neat infographic rounds up some familiar small business stats at Focus.com.

Reader Comments

Dom Celentano

January 22, 2010 8:07 AM

The trend is now Value PLUS affordability. Something can be of great value... so if I sold you a high-end BMW for 50% off, that is great value. BUT if you don't have the money in spite of the value... that is Affordability.

Affordability is driving the entire retail sector. Look at the most recent WalMart commercials featuring brands and telling the consumer that "is the brand any better if you buy it at other higher price retailers vs. WalMart"? Did you know that Walmarts fastest growing segment is the plus $85K segment? Look at the parking lot!

Nordstrom's had a 3% increase in sales PRIMARILY because they added lower price point items and brands.

It is not just cutting prices… that is reactive and anyone can be reactive but that is not a formula for long term success. It is evaluating Value and the appropriate Affordable price points and really knowing your customer to know what they perceive as Value and what the can Afford.

All the best!

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What's it like to run your own company today? Entrepreneurs face multiple hurdles new and old, from raising capital and managing employees to keeping up with technology and competing in a global marketplace. In this blog, the Small Business channel's John Tozzi and Nick Leiber discuss the news, trends, and ideas that matter to small business owners. Follow them on Twitter @newentrepreneur.

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