The ongoing Coronavirus pandemic has changed how businesses operate in more ways than one. Several small businesses have responded by employing money into social distancing messages, masks, and safety shields to cater to these changing needs.
Regardless of these additional expenses, only a few business owners are passing on this extra cost to the customers in the form of inflated prices. Many of them are afraid that they might lose business if they make the customers pay more.
A small minority is still bucking onto the trend and making the customers pay for the extra expense as coronavirus fee. There are more than a few reasons for businesses to raise the prices, but it all depends on your motive to do so, says Jason, who works with TFTH, where you can pay someone to do my homework. Regardless of whether you raise the prices or not, bear in mind, Customers will remember how you behaved in times of a pandemic.
Is it legal?
Well, to be honest with you, for a business to raise the prices during a pandemic is not illegal, as such, but if it is price gouging, then you need to rethink the grounds. That holds during an epidemic, as well as in case of any other normal circumstance.
Let us understand price gouging.
In these challenging times, the consumers struggle to avail of necessities like toilet paper, water, medical supplies, and face masks. Now, during this time, if the business continues to hike the prices, it is price gouging. It is a violation and falls under deceptive or unfair trade practices. Any company that is found engaging in price gouging will experience both criminal and civil penalties. If your act is outrageous, you might even experience some jail time.
Now, the big question is – How do customers raise the prices in a manner that still leaves them with a more substantial customer base? There will always be a good reason for a business to raise its prices, with or without a pandemic; what matters is its execution, says Steve, who works with FineGrades. One misstep, and you might lose your customer for life. One correct step and you will end up with a lifetime of customer loyalty.
So, before you decide to inflate the prices, here are some ways you can do it without losing your customers.
What is the motivation?
For a business, rising the prices fall under the ordinary course of action. However, if you do it with a wrong motive, the price hike might backfire on you. Thus, it would be best if you decided on the reason or the trigger for raising the prices. Only doing it to be opportunistic is not a justified reason.
For a business, raising the prices only makes sense if they are doing it as a response to the competitors or because of the increased supply chain costs, says Stacey, who offers accounting homework help to school and college students.
Ensure that the customers can afford this hike
During a pandemic, it is not just the small businesses that suffer. The customers are suffering at an equal length, if not more. So, raising prices can be a dangerous move. When you raise the prices beyond what the customers can afford, you might lose many of them forever. Even a minor price rise can affect a few struggling customers.
Thus, any time you think of a price hike, take some time, and talk to your customers. It is best to be compassionate and shoulder the costs. There is a section of humanity, which is struggling and will not be able to bear the loss of increased prices.
However, as a business, you need to run your operations. Thus, a balance is what you need.
Find out what the competitors are doing
Regardless of what you decide – increasing the prices in normal time or during a pandemic, you have to engage in thorough market research before you do it. This research will help you analyze if the customers are in a position to bear the hike. You need to know what the standard pricing is and what your competitors are doing. The worst a business can do is raising the prices in the time when the competitors are reducing them, says Zoe, who offers the best online python course.
Look for ways to upsell
Increasing the price is one of the ways to recover the pandemic related cost. However, another and more civil way to do it is by seeking ways to upsell. Let us understand this with an example of a software company. Suppose you sell software at 10 dollars a month.
Now, instead of hiking the cost of this software, you can instead add more features to the current software and upsell it. The idea is to think of ways that the customers would willingly want to pay a higher price.
Be transparent
Whenever you conduct a price surge, you need to be transparent about why you are doing what you are doing. So, if you are a restaurant, and is charging ten percent higher price, hang a board at the door as to why you are doing it.
Similarly, if you are an online eCommerce channel, and are raising the shipping costs, tell your customers why it is happening. Spelling out to the customers is a great way to build confidence.
