Trying to be the cheapest in a tough market often turns into a race to the bottom. You slash your prices, your competitor does the same, and suddenly you’re both giving away your hard work for peanuts. No one wins – least of all your bottom line.

And what about cutting costs? Sure, it sounds smart on paper. But when you start chipping away at the things that set you apart – your customer service, your staff training, your quality – you risk damaging the very thing your customers love you for. It’s like trying to win a marathon by sprinting the first kilometre barefoot. Doesn’t end well.

Sometimes, raising prices is the bold move that works

Believe it or not, there are businesses that have raised their prices during tough times and come out better for it.  When inflation hit and costs went up, Aussie toilet paper brand Who Gives A Crap didn’t shy away – they put their prices up and explained exactly why. They were honest, transparent, and leaned on the values that made their customers love them in the first place. And guess what? People stuck around.

Or look at the local cafés and delis that refused to compromise on quality, even when wholesale costs soared. Instead of shrinking the serving size or swapping out premium ingredients, they put their prices up a touch and added value in other ways – friendlier service, loyalty cards, free refills, community events. They made customers feel good about spending that little bit extra.

When your value is clear and your offering is strong, people will pay for it. Especially if you’re upfront about why you’re making the change.

Don’t discount – add value

Rather than trimming everything back to bare bones, ask: What can I add that costs little but gives more?

Maybe it’s an email that checks in on a customer after a purchase. Maybe it’s a little surprise gift in an order. Maybe it’s just remembering someone’s name when they walk through the door.

Small touches build big loyalty. Think of it like dating – if someone only likes you when you’re cheap, they’re probably not the one. The customers who stick with you through thick and thin? They’re the ones worth building for.

So what’s the game plan?

Here are a few quick wins to hold your ground:

Know your worth. If you’re good at what you do, charge accordingly.

Be upfront. Customers appreciate honesty about rising costs.

Double down on value. Add service, not just discounts.

Protect what matters. Don’t cut the things that make your biz special.

Stay visible. Keep marketing, keep engaging, keep building trust.

Back yourself

You didn’t start a business to be the cheapest. You started it to offer something brilliant. Whether that’s a killer coffee, a standout service, or a unique product only you can deliver.

So before you reach for the red pen and start slashing prices, ask yourself: What would happen if I held firm, backed myself, and found smarter ways to grow? Because when the going gets tough, smart always beats cheap. Every time.

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