Reduction in price or quality of goods if price of materials increase?

[btaliat]

At times, as producers, we are faced with some difficult situations. Ability to solve these problems critically makes us a good business woman or man.
Among the problem a business man may face is to either increase the price of his goods and commodities or reduce the quality of his goods and services when the price of materials increase.
As a business man, you must be wise in making decisions in this type of situation because your decisions may determine the future of your business.
And in either choice you make, you either lose many customers or win more customers. So, as a business man or intending business owner, what will you do in this situation?

 

[Mataracy]

As a producer of a product,when there is increment in the price of material you use for the production of goods,automatically their will increment in price of goods that will be sold to customers.
In other hand assuming there is a competitors around your company and for you not to loss your customers and you still want to maintain formal price then you need to reduce the quality of the goods in order to make profit.

 

[Donkiz]

With the price of raw materials needed for production increasing on daily basis due to high rate of inflation, businesses need to find a way to avoid making loss in order to remain in business, and that's where the issue of choosing between price or quality comes into play.

Unfortunately people are very sensitive to anything price, and will start looking for alternative if the price goes up, also many people are equally keen about the quality of what they buy, and will not be happy if the quality reduces.

If it's possible you can leave both the price and the quality the way they are, and instead reduce the quantity/size of the product and there won't be much complaints about it. But if you must tamper with either price or quality, then I will go for quality because not everyone will notice unlike price.

 

[Jonaville]

As far as businesses are concerned prices of goods and services will always fluctuate therefore there are times when businessman or businesswoman we have to adjust their prices so as to avert any form of loss. However, when situations like this happen, it is not always advisable to reduce the quality of the product. We need to keep in mind that quality should be of utmost importance to every producer out there because there are some people who actually prefer quality more than quantity. So maybe increasing the price while maintaining the quality of the product should be adopted instead of maintaining the price and reducing the quality of the product.

 

[Nii41]

People are patronizing you because of that quality in the first place. As you build your brand you should have your goals and mission. Every brand should have integrity as well. Reducing the quality of your products simply because the raw materials increased in price is certainly not the wise thing to do, because eventually, your customers will notice this reduction in quality and decide not to purchase again. It's best you increase the price of the product and maintain the good quality. You can always explain to them why there was an increase in price of the products.

 

[Kennysplash]

A business person should know that he is receiving patronage because of the quality of his products and services. So if there is inflation he should tactfully inflate the price and not reduce the quality. If his customers start noticing that his quality has reduced he stands the chance of loosing most of them. You can take the liberty of explaining to them that things are now expensive if they ask why the inflation in price. Me personally if I notice a decrease in quality I will loose interest in the product or service of the seller.

 

[Olajidey]

This is a critical issue as many business owners make mistake as regards to increase the price and maintain the size of the product or reduce the size of the product and maintain the price or reduce the quality and maintain the product.
If you increase the price and maintain the product size, believe me, you will lose a customer as people are adjusting to your price and make changes to the price will be difficult but if you reduce the product and you maintain the quality you will not lose many customers as many people are not really focusing on the size as the quality of the product.