Lowering Price-good Or Bad?
by Lafaso870, Creator
- Created: September 26, 2010, 12:47 am
so I own a self serve frozen yogurt shop.
I charge .39 per ounce. Compared to non-self serve place, it is 30~40% cheaper.
I was the only one in 3 mile radius and sales kept growing till 3 other yogurt shops moved in within 5 mintues drive.
My gross sales has been down as much as 50%!!!
1st self serve yogurt shop (famous national chain) charges 39 cents
2nd non-self serve yogurt shop is about 30% more expensive.
3rd self serve yogurt shop (local guy) charges 35 cents
most of the day, it's pretty slow now. It used to be busy at night even when it was cold outside but it's a lot slower now.
I was thinking, instead of having a dead space, I should rather bring more people by lowering prices. (sort of chicken game)
I am just concerned what if people recognize my yogurt as cheap product because of its price? (obviously some people are dumb. they just see high price and relate that to high quality)
plus I hope current regulars won't get offended by lowering price.
I am thinking about either 34 cents or 33 cents.
As far as raw costs goes, I don't make anything or lose money on many topping options so I guess it would be about making money from yogurt alone.
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