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  • From: "Tradingpost" <tradingpost@lobo.net>
  • To: livingontheland@lists.ibiblio.org
  • Subject: [Livingontheland] "SELLING YOURSELF SHORT"
  • Date: Sat, 30 Aug 2008 21:42:56 -0600


(this is an article I wrote for our statewide market growers list)

Madelyn and all, I hear what you say about price resistance. And pricing is
always a concern in markets. Let me take a stab at it.

Let's call this "SELLING YOURSELF SHORT"

Which is better, to price higher and lose some customers or price lower and
not have any price resistance?

Let's do the math.
Suppose you price at $5.00 and four customers buy and one resists.
You take in $20.00.

Suppose you price at $3.00 and all five customers buy.
You take in $15.00.

Or suppose you price at $5.00 and three buy and two resist.
You take in $15.00.

This gives us a rule of thumb: if you price 66% higher (from $3.00 to $5.00)
and lose two out of five customers, then that's the break even point. So if
you lose *less* than 20% (2 out of 5) of your customers, you make more by
charging $5.00 than $3.00. And if you lose two out of twenty or three out of
fifty, your cash box will go home with more $20.00 bills in it.

Bottom line: lowering prices to sell more may not make you more money.

... ... Of course buying fresh, quality produce means more for your money,
not less. It's quality you can taste. Kids like it. It doesn't end up in the
disposal - which is money down the drain for storebought. This is a real
problem; it tends to go bad faster than fresh market produce. So when they
pay $3.00 and nobody eats it, they've just spent $3.00 for nothing. I like to
say that unripe, tasteless storebought tomatoes aren't even worth $3.00 lb or
$1.00 lb. We know that people expecting bargains are fooling themselves when
storebought is no bargain at any price. Also think nutrition. Even worse for
pesticide laden fruits. Come to think of it, they're better off feeding it to
the disposal.

We also know what it takes to bring fresh, local produce to our customers.
Often they don't. We can't live on the wages paid migrant workers on the
chemical-drenched megafarms. In fact, they're exempt from all minimum wage
laws. They can't go home to sleep at night. No benefits. Untold thousands of
them are sick or die from chemical exposure. We don't pig out at the
government trough getting crop insurance and price supports, money for *not*
planting some acreage, and credit to finance the next year's entire
operation. We don't demand something for nothing.

But the point I really want to stress is this: when they compare your $5.00
to China-Mart's $3.00, they're not even comparing the same things. Your
product is as different from theirs as night and day. It's just not the same
thing. We don't expect customers to pay for our mistakes, for bad weather or
poor judgment.

But if we don't get a fair price they won't get decent food, period.
Because we won't be there next year.


paul tradingpost@lobo.net
Old World Gardens, best tasting heirloom European varieties grown naturally





  • [Livingontheland] "SELLING YOURSELF SHORT", Tradingpost, 08/30/2008

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