My weekly e-letter distribution coincides this week with Jeffrey Gitomer's. His posting, "If you REALLY want it, I'll drop my price" is a reminder that too many of us think that price is the key issue in decision-making, and we tend to cut our own throats in "negotiating" a deal when the client is ready to pay the full price -- and with effective marketing and branding, we can actually earn a higher p rice.
Pricing and value are complex -- we all know that the real cost of manufacturing so-called luxury brands has little correlation with their retail price; but many contractors and sub-trades are trapped in the negative bidding war environment, wondering how they can even hope to win the business unless they (gulp) lower their prices below their actual cost of doing business (bad move!)
I realize the marketplace is competitive now; in many areas in the U.S. and now in parts of Ontario, recessionary conditions prevail, and real purchasers with cash on hand are relatively scarce. You need to be cautious about your expenses and fixed costs and not throw good money after bad -- but thoughtful attention to how you market and promote your business can help you escape from "low bid wins the job (and loses money) tyranny."
Jeffrey Gitomer's weekly newsletter is free, by the way; and you can purchase his books on the used book market for little money (or pay full retail, if you wish, and still get great value.)