Target Market Considerations. Canada 150 Recommendation #96

Tuesday’s= Starting a Business

New business owners are often tempted to gain a market by charging less than their competitors. The attempt to get customers by being the cheapest could be a problem for two reasons;

1. There may be costs you do not know about yet, being a new business owner and your price might not actually cover your costs.

2. You might attract a bunch of bottom feeder type clients who are only with you because of the price and you won’t be able to increase their pricing so that you can make more money.

The target market for a new business should be the people who will appreciate the quality that you bring to them. A new small business does not compete on price — leave that to the Amazons of the world. A new business owner is going to compete on the quality of their service and they need to find that target market that fits.

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