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Posted by Felix Okoli on Tuesday July 31, 2012 9:0:18:

If you are into retailing business like a provision store or clothing boutique, one thing that can make customers have confidence in you is if you make use if your products already have price stickers on them.

In Nigeria, most retail stores don't really place a price sticker on their products since they sell based on price bargains meaning that they can place any price they like on their product as long as it's higher than the cost price. That method gives room for distrust and lower patronage by customers. This is also not a cool way to sell most especially if you are the kind of person that employs sales staff. Your product pricing could be left to abuse and probably cause low sales if customer feel that they are cheated by your staff with overpriced products. It is much better if your pricing method is transparent to your customers else they may not buy or not return back a second time if they felt cheated the first time.

A price tag on your products or services is a form of transparency and encourages trust from potential customers who will be more likely to buy the product or come back for it later. If prices were allowed to fluctuate or be based on negotiations, people would not feel comfortable buying or would have to ask around different stores before making a decision to buy. So in essence, it leaves you open to competition, lower sales, low trust and not so loyal customers in the long term.

When placing a price on a product or service, you can place it at a higher price but let it be fixed for the long term say 1 year, considering the strength of the naira within that period. You could change the price later on after 1 year or 6 months but don't make

Benefits of using price tags
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- Promotes transparency and trust
- Encourages long term customer loyalty
- Reduces or eliminates hike in prices by sales staff
- Helps customers get good value for their money
- Promotes more sales

Disadvantages of not using price tags
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- Reduces customer trust
- May subject products to price abuse
- Doesn't encourage loyalty from customers
- Minimizes long term sales

Nowadays, there are large shopping malls opening up in cities across Nigeria and they seem to be taking over the market shares from the traditional retailers. One of the keys to their success is their pricing strategy - they tag their products. They sell mostly consumer and household items that people can really buy at reasonable prices.

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Comments:
Re: Sell more using a price tag Reply by ibrahim kachallah on Tuesday July 31, 2012 at 10:20:24:

I am always attracted to shops with fixed prices on items, i some times prefer paying some transport money to a shop that i know they dont use to bargain on their prices, even if the price is a bit higher than it is in some other shops, thanks for the post anyway!

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