A newsagent recently became annoyed when one of the sales people from Tower Systems, the POS software company I own, said that Tower was not a good fit for them.
They wanted to switch to the Tower newsagency software and wanted a price deal, citing the price of other software. Rather than agree to match or come close to the price, the Tower sales person explained it was unreasonable to seek a price match for a very different product and a very different support experience. They wished the newsagent all the best and advised we were not a good fit.
The prospective customer pushed back saying they would only spend a certain amount of money. Not budging, the Tower sales person again wished them all the best.
This is when the newsagent got annoyed – that Tower was willingly walking away.
Ages ago I decided Tower would not chase prospective customers down a rabbit hole of discounting. No one wins from that, especially not a customer who wants their software company to evolve and support the software in a timely manner, especially not a newsagent who expects their software to connect to business partners.
This is on my mind today because of a product related discussion I had with another newsagent recently. They were chasing cheaper products with which to compete with a nearby discount variety store.
My view is that people who buy on price are not loyal. They will always chase price. If you meet them at the price point they have sought, you have not won because the price battle will come back at you again and again.
Being prepared to walk away when an opportunity is not a good fit for your business is liberating.
I want to be involved in businesses, tech and retail, that offer good value at a fair price. That leads me to an approach of wishing some people all the best and saying we are not right for them.
I don’t chase cheap products for my shops even thought we are near Aldi and the Reject Shop. I chase quality and value. Customers react by spending. The same is true with technology. I think one of the reasons Tower Systems serves more than 1,700 newsagents with its newsagency software is the focus on the product and service ahead of price.
It is liberating not sweating over every prospective customer. It’s also a key reason for growth in many business situations I think.
I’m always prepared to pay a bit extra for a superior product and service. The old saying “you get what you pay for” is rarely wrong. It never hurts to ask for a discount though and as a retailer you have to constantly ask yourself whether a suppler is still giving value for the cost and whether there are comparable and cheaper alternatives.
I’m a strong believer that our channel needs to position itself based on service, range and quality. Competing on price is a mugs game and should be left to the discount stores.
Having switched to Tower for our POS software within the last 12 mths and having engaged them to to develop our newly launched online store we are more than happy with the service provided. As Peter states “you get what you pay for.”
There are many different aspects to Retail however before attempting this I would say the I Agee discounting a product such as a service backed up product is not going to be a bargain for either party. Peter’s comment is good one.
The other part to the equation is about Retail and newsagents. Books, Stationery and Gifts have their moments of competitive pricing-Sales if you like. E.O.F.Y. for Office Stationery etc, some Christmas Cards, Some Gifts at various times and reasons.There is the margin to quit not selling items and compete with other stationers when necessary.I was talking with a parcel courier for Aust Post today and he said he delivers two vans full 5 days a week from on line purchasing and he stated most of it was price driven. his workload has tripled in the past few months and climbing every day.
We as newsagents don’t have the problem of the sort of goods like -TV’s -kitchen appliances-computers etc where once you know what you want Price is the key factor.
Our customer service – the right goods for our community is our biggest repeat business package.