Find out why there are other ways to get a competitive advantage, other than lowering the price of your products or services. Vparagon Sales Consultancy, sell your products or services in Europe.

1. Why competing on
price is the most stupid
thing you can do
by Alex Valassidis | Sep 30, 2017

2.  For me, there are 2 kind of business that compete on
price:
1.Those who can and
2.Idiots
 Let me explain.
 If you are a big supply chain like Carefour, Makro, or
Aldi, then you sell cheap and that is all right.
 Why is that all right?
 Because you have the power and the money to buy
huge quantities and sell them even cheaper than
the price you bought!
 Hey Alex, how is that possible?
 That is possible, my friend, because when you buy
huge quantities of cheese, you pay after 180 days,
and you sell this cheese in your supermarkets
cheaper than you bought it for cash.
 The winning difference is because of the banks
interest, you gain in the bank by having your money
there for 180 days.
 Heeee, and how much is that money, is not worth It!!!!
 Again, you are wrong. It is worth it because you buy
the cheese not for the cheese, but to
 use it as a decoy… meaning you attract the customers
in your shop because of the cheap cheese in order to
sell them other products at a profitable price.
—————————————————————————
 But, let’s move away from this example that applies
only to a small category of businesses and let’s move
on the real world of small business and freelancers.

3.  SCENARIO 1 (THE IDEAL)
1.LOCATION, LOCATION, LOCATION
 If your shop has a prime location and your clientele are
passer-byers, then you can charge any price you like. The
reason why is because those clients are one-time clients
that buy the stuff you are selling out of need and
convenience.
 I used to own an Internet Café in a very touristy location in
Greece some years ago. It was the most successful internet
café on the island, for one reason and one reason only: it
had a
 prime location and my clients were tourists.
 Of course, we offered a good service and of course we
were helpful, but
95{c274d49bb9d0eb56ca9f4ccc7d03482e3fd4b0ffce3feb11
eb8eeffb6fc4f98f} of its success laid on the fact that I had a
prime location.
 This is what applies to all touristic shops around the world.
The rule is that you buy a given quality for very expensive
just because of the location and the urgency that your
customers have.

4. 2.MONOPOLY
 Your shop or freelance service has the
monopoly in a specific area.
 Let’s say you own the one and only
pharmacy in your village or you are the only
doctor in
 your little town, I guarantee you are going
to have a steady clientele just because of
this fact.
IF ONE OF THOSE 2 FACTORS APPLIES, BE
RUTHLESS AND CHARGE RUTHLESSLY
EXPENSIVE. PEOPLE ARE GOING TO BUY
BECAUSE THEY DON’T HAVE ANOTHER
OPTION.
Are you old enough to remember long
distance charges for International calls
back in the 70s or 80s? This is a
typical example of how monopolies
skyrocket prices. Compare those
prices with today’s prices where mobile
phone companies and state telephone
companies compete in a free market
with VoIP providers and you get the
picture

5. SCENARIO 2
Your shop does not have a prime location, is selling what
hundreds of other shops are selling, or your freelancing
business is one out of thousands.
Even if that is the case, you know there are businesses and
other freelancers in your area
that sell more expensive items and are making more
revenue and more profit than you. How do they do that?
Are they better? Not necessarily… but they are doing
something different, right?
Let’s see.
1. DEFINE THE INDUSTRY
STANDARD AND DO BETTER!
EXAMPLE: ACCOUNTANT
A couple of months ago, I was searching to find an accountant
here in Barcelona. My case is different than the case of most
of the people here for some reasons.

6. 1.I am a foreigner with limited Spanish
knowledge
2.I sell online abroad, outside of Spain
partly outside of the European Union
 I contacted several accounting
offices here and the majority offered
me the standard services an
accountant offers.
 However, I chose the one I chose for
several reasons and none of them had
to do with a
 cheap price… it was actually the
contrary.
 When I called my accountant, he did
several things that the other
accountants did not.

7. 1.He talked to me personally and not his
assistant.
2.He offered me to come and see him in
his office and he also told me that he
was going to charge me for this visit!
(FREE IS NOT GOOD AND NOTHING
GOOD IS FREE.)
3.When I visited him, he answered all
my questions (in English), he gave me
additional.
 Information that was very useful to me
without asking. He explained to me the
risks I had and proposed me
solutions. He gave me a roadmap How
we can start, which are the exact next
steps, where he can help me.

8.  HE EDUCATED ME. HE OFFERED ME A
LEARNING EXPERIENCE. HE MADE
ME RECOMMENDATIONS I WAS NOT
AWARE OF. HE SPOKE ENGLISH. HE
WAS AN EXPERT IN INTRA
COMMUNITY TRANSACTIONS.
2. LITTLE DETAILS MAKE THE BIG
DIFFERENCE.
 EXAMPLE GREEK RESTAURANT IN
GERMANY
 You think that the big difference is the
core of the business you are offering?
 Although the core of the business you
are offering and its quality is the main
subject of interest, but the little details
are those that make the big difference.
 There is no better example for me than
this.

9.  When Greek immigrants went to Germany as
workers back in the 60s, many of them started
their own restaurant business. It can be a long
discussion about the reasons that they were
so successful, however there is one thing that
does not go unnoticed.
 When you visit a Greek restaurant in
Germany, the first think you get on the table is
a shot of ouzo. This is seen as a sign of
hospitality and a nice gesture of welcoming in
the
 restaurant, however what it really is, is exactly
this: a nice marketing trick making the whole
Greek restaurant experience better and nicer
using the practice of reciprocity to give the
winning difference to his business. At this
time, no other restaurants were giving
anything for free, and while those Greeks
offered an ouzo shot (with minimal cost) for
free, they made the winning difference.

10. .
3. DEFINE WHO YOU
ARE AND WHO YOU
WANT TO ATTRACT
EXAMPLE DENTIST
You cannot sell everything to everyone
– no one can. Decide which customers
you want to have and offer them a
product or a service they want.
It is absolutely necessary to decide who
you want to attract.
You cannot sell to all because the “sad”
reality is that by selling to one group of
people, you exclude the other one.
My dentist for example has upper
medium-class patients… that is a
conscious choice of him.
How did he achieve that?

11. 1.He defined what was “Industry Standard”
and offered better. He offered better quality
of dental machines and a better service.
2.He had his praxis on a location where those
people worked and partly lived.
3.His praxis was next door to the American
Embassy, making him have employees
working on the embassy as his clients.
4.He hired an American girl at the reception.
5.He visited seminars abroad and offered
products and services known to his clients
but unknown to the locals, which made
him more appreciated from both groups.
6.He advertised on specific magazines and
avoided others.
7.He refused to treat customers that did not fit
his clientele’s image…regardless of if they
had the money to pay him or not.
8.He charged premium prices.
9.He had you always waiting – having a full
waiting room gave the impression of high-
demand.

12. 4. GIVE YOUR BUSINESS A UNIQUE
NAME
If you give a generic name to your business or job,
expect generic prices. Here are some examples:
Barber Shop – HairStudio
Taverna – Restaurant
Salesman – Sales
Consultant Lawyer – Legal
adviser
Electrician – Electrical
Expert
BY USING A DIFFERENT NAME FOR YOUR SHOP OR
YOUR SERVICES, YOU ARE INSTANTLY SELLING A
DIFFERENT PRODUCT OR SERVICE, YOU ARE SELLING
A DIFFERENT EXPIERIENCE TO YOUR CUSTOMER,
THEREFORE YOU ARE ELLIGIBLE TO CHARGE MORE.
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