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Pricing Fairly

February 5, 2013

pnkroses

In preparation for an upcoming event, I headed to Tops Market to purchase pink roses for my centerpieces. Knowing Wegmans offered less expensive roses, I decided to go to Tops Market to save time since it was 5 minutes away. As I approached the floral department, I was stunned to see the roses priced at $29.99 per dozen. I had been purchasing roses for six years and knew prices ranged between $7.99 – $12.99 per dozen.

Shocked by the pricing, I asked the employee, who knows I purchase roses once a week for my events, why the substantial price increase. She said, “Valentine’s Day is approaching and we want to get customers prepared to pay higher prices for the holiday.” In response I said, “But it’s only February 4th any roses people buy today or even this week won’t last until February 14th. Are you sure they should be priced so high so early? Isn’t there anything you can do for me today?” Without thinking about the thousands of dollars I’ve spent on roses there she simply said, “That’s our pricing.”

As I turned from the counter I said, “You are sending me to Wegmans.” She shrugged and I left annoyed with the lack of sensitivity. 20 minutes later when I arrived at Wegmans, I took a few minutes to share my story with the head of their floral department. She explained to me, “A few days before Valentine’s Day, we charge higher prices for roses too but it’s because our supplier charges us more for the holiday. But we don’t do that until we have to because we don’t believe in price gauging.”

What I learned from this experience, which might help your business today:

*If you are going to substantially increase your prices, notify your repeat customers to make them aware of the pricing increases. Explain why the change is occurring and when so they aren’t surprised.

* Don’t forget 80% of an entrepreneur’s income comes from 20% of their clients. Pay careful attention to complaints from your most important customers. Address concerns to keep their business.

* Don’t ever let a customer walk out the door or get off the phone knowing they are going to your competition. If they are right about the situation and they take the time to speak to you about it, make a onetime exception to keep their business.

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5 Comments leave one →
  1. February 6, 2013 7:47 am

    It never ceases to amaze me when a customer service employee allows a good customer with a legitimate concern walk out the door (especially when they’re heading to the competition).

    You raise good points in this post. The first one might seem like a difficult prospect for some, but letting clients know in advance about a price increase and having a conversation about it creates a stronger relationship.

    Thanks for the post, Tracy. You’re discussing some topics I’m not necessarily finding on other blogs. Have a good day!

    Like

    • February 6, 2013 8:06 am

      Thank you Tracy for reading our blog posts and for your own insights. Discussing price increases is never a fun topic but it is necessary for both parties to have from time to time. Tracy

      Like

  2. February 6, 2013 8:31 am

    Thank you for writing this. Good information for all businesses. And I have had the same experience with Tops. After having them move into our local two villlages I thought we might get better prices on a FEW items (before I felt everything, especially milk, was high). Not so! Everything is high. And my mom needed roses for church and was shocked to find Tops is a fortune. So back to Wegmans we go, even though its a lot farther.

    Like

  3. February 25, 2013 7:41 am

    I’m so sorry this happened to you. You must have been really annoyed. What should have happened is that the floral attendant should have gone to the manager and asked what they could do for you that day, given the amount of business you’ve done with them. We do have a connection with a wholesale florist, so if we can help you in the future, I hope you’ll ask. Linda @ The Bridal Connection.

    Like

  4. Amanda Funk permalink
    February 26, 2013 11:15 am

    Great share Tracy! I am always surprised at the little things small businesses do that kill their business. IE – Hiring a contractor – they have so many exclusions in their contract about what their responsibilities to a project are not, that you don’t want to hire them.

    Like

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