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REAL ISSUES. REAL ANSWERS: Price Wars

“Our company’s primary market is the higher-end builder. Our primary weapon to avoid low-margin competitors is to provide superior service. This begins with a highly trained sales force with a wide base of knowledge in finished goods (windows, doors, etc.). Our ability to meet builders and their customers in our design center to discuss product options helps differentiate us. Plus, we are on the job from start to finish to earn the builder’s confidence. Poorly trained management and staff only have one thing to talk about: cheap price. They can’t talk about service because it doesn’t fit into their matrix.”


“Try to outlast the low-price competitor and not accelerate the price-slashing.”


“Make the decision to stay in the game or get out. I discuss it with the salesman and decide what is best for the company and the salesman.”

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“We strive to build enduring relationships with our customers. If a price war comes along, we sit down with the customer and talk about the services we provide and ask that they discuss this with the disruptor to see if they are willing to do what we do.”


“Very little. Our best (and actually, our only) solution is to double-down on what distinguishes us and our products from our competition and focus as much on these things as we can. We will discount as we are able, but often the deal is already done before we get a chance. This is actually the norm for us. We have to adjust to the markets that we serve and find our niche, work it and defend it.”


“We review all competitive quotes to ensure that we are comparing like quantities and quality. Then we review of cost of service with that customer and how critical they are to our long-term mix. Finally, we pay commissions on a sliding scale based upon gross margin.”

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“The company does nothing. If the sales person wants the job, he/she usually has to take a hit on his margin (commission) but the company still gets their cut first.”


“We do not participate in price wars. Instead, we offer very good service and knowledge, and our pricing is fair for the services we offer.”


“We hang onto our customers and look for other sales to make up the difference.”

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“We walk away from unprofitable business. We have positioned ourselves as one of the better dealers who offers every service that a builder/remodeler needs, and we look for customers who value these services. But our outside sales reps are full commission and need to eat. It’s a balancing act. We do have lines in the sand we won’t cross.”


“Very rarely are we involved in ‘price wars,’ per se. Anyone can throw a low price on a job, but can they perform up to the customer’s expectations? We have walked away from plenty of work just to have the job come back to us due to lack of performance. Strengthening the relationship between us and the guys in the field has been successful to build loyalty.”


“Assure them it’s only temporary, and we won’t get in that type of dogfight.”

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