A competitive price is critical to any business, including the inflatable industry. If your competitors are continuously undercutting your rental prices then you will lose business. Many customers shop by price alone. While you may be able to win and retain customers based on the variety of inflatable products, add-ons you offer and your customer service, you will lose those customers that are only focused on price. If this is something that you are comfortable with, then you may not need to offer any types of discounts.
You will always have some customers who are continuously trying to haggle with you over your prices. Determine beforehand how flexible the pricing of your services are and what you can afford to do. Keep in mind that your time is worth money too!
Don’t be afraid to say no, even if it means losing a potential client. If the price they are looking for simply falls below realistic expectations and is way out of the ballpark for what other inflatable businesses are pricing, it may be time to cut that particular customer loose. In the end these customers tend to always be looking for more, and are a tremendous time and resource sink as well.
Some companies may choose to match the pricing of their competitors. We see this a lot in the retail world. However, this can be a very dangerous practice for inflatable businesses, particularly if you are a small, family owned company. The larger inflatable businesses with more cash flow may try to continuously drive the price down, eliminating their profits or actually causing them to lose money, in an effort to drive you out of business. This is a risky practice for inflatable businesses to get into.
Another risk you take when offering discounts to customers is word of mouth. Because much of the inflatable business is sales generated by word of mouth, your pricing will also likely be discussed. Potential customers that hear one customer received a lower price will want the same discounted price, or worse will think you are trying to rip them off when you price them your standard (higher) price.
A better business approach to win over the customer who is always trying to bargain shop is to offer them add-ons to go with the inflatable products they are renting. From popcorn machines, to snow cone and cotton candy machines; a bargain shopper who feels like they are getting something for nothing will go away feeling happy and as if they “won”. Assuming that you have these products in your inventory there is no additional cost for throwing these “freebies” in with your customer’s order.
If you do decide to offer discounts do so wisely and don’t rule out other bargaining techniques with your price-sensitive customers.