Is the Wal-Mart Price Really Lower?
Depending on what kind of products you sell in your retail store, at some point you will have some one come up to you and say..."Wal-Mart is cheaper". I am sure that every retailer in the country has heard this line one too many times. However, while Wal-Mart may have a lower price, does it have the best price for the money?
This is where knowing your competition comes in handing. No, you don't need to go into Wal-Mart or Best Buy or any of those big box stores every day to find out about prices and how they are doing things. What you do need to do is look at your important sellers, the ones that sell enough and make you enough money and make sure you know how your product competes against the competition whoever that may be in your store. You need to know how that products is a better value the competition and inform your customers about it.
Let give you one example from when I was managing an appliance department. Our biggest microwave oven at the time was 1.8 cubic feet. At the time it was selling from $179.99. Wal-Mart also had a 1.8 cubic feet microwave but it sold for $159.99. So Wal-Mart's price was lower. But was it a better value?
Our microwave had sensor cook, various quick select buttons including popcorn, sensor defrost, multiple reheat options, and keep warm.
On the other hand the Wal-Mart model had none of this. In fact what Wal-Mart did (and what it often does) is go to the manufacturer, tell them they wanted a microwave at this size, at this price, and to take out everything they could out of it to get a cheap price. In fact this the Wal-Mart model was not even in the manufacturers catalog which you will find in many of their products.
So what I did was have a side by side comparison of the two models and show how much of a better value it was (comparing it to Wal-Marts it was worth about $219.99).
Probably 20% of the people will still go over and buy the Wal-Mart model despite you showing your is a better value. However, your goal is to convince the 60% of buyers who are on the fence. By being professional and knowing your facts, you can show them that you have the best value for the dollar and the customer service to go with it.