The ongoing challenges of today's economic climate have led 55% of small business owners to cite inflation as their biggest concern in the second quarter of 2024, according to the latest MetLife and U.S. Chamber of Commerce Small Business Index.
Many big businesses, including Walmart, Target, and Amazon Fresh, are fighting back against inflation and changing consumer habits by cutting prices on frequently purchased products like groceries, personal care, and seasonal products. However, slashing prices on a large percentage of inventory items may not be the best approach for small businesses that already operate with limited resources.
Fortunately, there are ways to offer more value to your customers without sacrificing your bottom line. Offering special "inflation-beating" deals and long-term savings can help small businesses turn a profit while helping customers stretch their money further. Here are five ways to draw customers in, regardless of the current economic conditions, and show them your business is worth their hard-earned dollars.
[Read more: How Small Businesses Stay Competitive in a Challenging Economy]
Create subscription plans
Subscription plans offer consumers a set price, often at a discount, for products or services they regularly use. Offering subscription plans helps generate steadier sales and allows businesses to predict their finances and anticipated consumer purchases more accurately. However, with consumers looking to cut costs amid rising prices, businesses must ensure their service provides value and is worthwhile for customers.
Offer discounts on bulk purchases
A great strategy for small businesses looking to increase their sales during inflation is to offer discounts for consumers who make bulk purchases. This strategy, popularized by membership-based warehouses like Costco and Sam’s Club, incentivizes customers to increase their spending and stockpile products so they can take advantage of current prices (which are likely to increase with ongoing inflation).
As an added bonus, this strategy lets small businesses do more of their own bulk purchasing to access the same cost-saving advantages as their customers. Many business suppliers offer reduced per-unit prices for wholesale purchases, so you can further increase your profit margins.
There are ways to offer more value to your customers without sacrificing your bottom line.
Guarantee price matches with competitors
Price often determines a customer's loyalty, as shoppers flock toward retailers offering the best deal. To compete with bigger retailers, small businesses can advertise that they'll meet or beat a competitor's prices on certain items.
Price-matching can help your small business attract savvy consumers without having to lower your prices. This strategy can help you compete with bigger brands while maintaining sustainable prices and minimizing your financial risk. It can also help you build customer loyalty and add value to the customer experience, thereby encouraging repeat business.
[Read more: How to Price Your Product: A Step-by-Step Calculation]
Implement seasonal sales and promotions
Holidays and seasonal events are the perfect time to offer big discounts to customers. Provide deals on items customers are seeking during certain times of the year. For example, offering discounts on back-to-school essentials in mid- to late-summer can draw customers to your small business, especially if you offer unique items that are hard to find elsewhere.
Providing increased value on items your customers need helps boost customer loyalty and retention. It can also help boost your small business's visibility and sales for long-term growth.
Create 'bundles' to help consumers save money
Bundling — offering multiple products or services at a discounted rate when purchased together — increases the perceived value of your offerings and encourages consumers to make bigger purchases they might not have otherwise considered.
Small businesses can implement bundling strategies in several ways, such as:
- Creating predetermined bundles based on product popularity or stock.
- Offering tiered discounts that increase as customers spend more.
- Building personalized deals that cater to individual consumer preferences or buying habits.
This approach can help boost sales and promote more consistent purchases, leading to lower costs of goods and stability during economic fluctuations.
CO— aims to bring you inspiration from leading respected experts. However, before making any business decision, you should consult a professional who can advise you based on your individual situation.
CO—is committed to helping you start, run and grow your small business. Learn more about the benefits of small business membership in the U.S. Chamber of Commerce, here.
