Jump to content

Location Wants to Talk Pricing


gelaro

Recommended Posts

I got a call today from a location that wants me to stop in to talk pricing. How do these normally go? And how do you typically handle it?

My guess is he wants lower pricing. All snacks are $1.00 and the 20oz drinks are all $1.50 which is what almost all my other locations are. 

Any thoughts or suggestions on how to handle this?

Link to comment
Share on other sites

Go to 7-11 or the gas station, and take pics of the prices there, if they are higher than yours.

Show pictures to them, say how your prices are lower.

Also, explain how you not only have to pay for the product, but explain things like gas, insurance, machine costs, maintenance, cost of new compressor, what a bill val rebuild costs, etc.

Link to comment
Share on other sites

There's a chance that someone else offered them a better deal.  That, or they think your prices are too high and they would rather you lower your prices and lose out on significant profit rather than pay their people more money.  If it were me, I would hear them out first.  I can do candy and pastries for $1.00, and I can do LSS and cookies for 85-90 cents.  I can't go lower than $1.40 on 20 oz soda though.  If they try to tell you that another vendor is offering something silly like $1.25 for 20 oz bottles or underbid you by 10-20 cents across the board, then you need to decide if the location is worth it.

Keep this in mind, if you know or think you are dealing with competition here, then the size of the location will usually dictate WHO the other vendor is (big company, little company, etc...).  A large company won't go into a place with 30 people and offer ridiculously low pricing.  Such an account isn't worth their time even for higher pricing than yours.  So, if it's a rather small account (less than 50 employees)  and you think someone is offering a better deal, then your only real choice is to stick to your guns and let them know that they are paying for the service and the convenience.  A really small vendor who works out of a car doesn't have many expenses going on, and he/she can afford to underbid you, but he can NOT afford to do it forever. 

It is always important to mention that your pricing is cheaper than retail but competitive with mainstream vending in your area.  Everyone raises prices to cover increase costs.

Link to comment
Share on other sites

Don't be too quick to assume the worst, it may be just a simple request, but do be prepared to end up talking about pricing versus some other offer they have had.  It's always a delicate subject, but I know what my pricing minimums are and will give up an account rather than work it for free or at a loss.   Some companies are willing to subsidize lower prices for employees, that is, you have a system for billing them the difference in price between what you need to sell for and what they want the employees to buy for.  With bigger companies especially on the left coast it's more common than smaller locations.  You can throw price comparisons at them like orsd suggested, but if someone else is offering them lower prices that is the only comparison that matters to them.  It's the nature of the business, so try not to take it personally if they switch.  If you end up leaving, leave on good terms if you can, and you may end up back there when the cost cutter can't deliver anymore....  by the way, I think your prices are good, especially on 20 oz drinks.  I don't know what size snacks you carry, I still have a lot of .75 items in small snack size and crackers, I go .85 on larger snacks and 1.00 on candy (soon to be 1.25 on candy as my costs go up).  My commission accounts are a little higher to cover the commission to the location.

Link to comment
Share on other sites

The conversation was mainly about coffee related prices (creamer, sugar, and cups). He says my coffee prices are okay, but the other stuff (cups, creamer, and sugar), he says someone else is quoting him cheaper. So I asked him what I was competing with. I am not sure I can get it for what he is saying.

He says a guy is offering him Coffeemate creamer and sugar at about $25 a case. Does that sound right? I can't a case of anything that cheap. The cheapest I can find is the Sam's Club brand that would be about $30 for a 24 12 oz canisters. Is it possible the other guy is quoting him for 12 canisters instead of 24? That's the only thing I can figure. Vistar has Coffeemate at about $18 but that's for 12. 24 would be $36. I am selling him 24 for $42. 

Am I missing something here that I should know about before I get back with him?

He did ask about vending prices. I told him I would take a look but I didn't have a lot of room on that. I told him the drinks are $1.50 and I am not making much on that. He said the guys complained and he told them they could get at the C-store. I said, Yes, but I deliver it and keep it cold for them. He acknowledged that was worth something. I told him I didn't think the fifteen cents was a deal-breaker on the snacks; I wouldn't even lean over to pick fifteen cents up off the ground. If someone bought something every day, it would be seventy-five cents over a week's time. So he didn't seem to bothered by that. I might switch it to a two-tiered pricing ($1 and .85). So that part went okay, I thought.

Link to comment
Share on other sites

If it was a 200-ct box of coffee mate creamer cups, then I can see him selling them for $25/case.  You should ask your account to clarify if they are being offered 200-ct creamer CUPS for $25 or a case of dry canisters.

Link to comment
Share on other sites

Archived

This topic is now archived and is closed to further replies.

×
×
  • Create New...