Re: Brinks & Broadview Takeovers

[tourman <robercampbell@xxxxxxxxx>]

See replies interspersed below...
>
RHC:There are
> >literally dozens of new firms just in our city in the last several
> >years, most of whom feel they can only succeed by steep discounting of
> >everything. As we all know, this cheapens the market for everyone. The
> >problem has become much worse with the downturn of the economy, with
> >everyone looking for the cheapest pricing, and the lowest monitoring
> >rate possible. At $15 monthly, I used to catch crap from other dealers
> >over my pricing. Now it is only "middle of the road"..!
>
Doug: Do you not see the irony in your comments ?, when you originally
priced your
> services at $15/month other dealers apparently gave you crap for
> discounting. Rightly or wrongly they probably put you in the category of
> those who "feel they can only succeed by steep discounting".
>
> You may provide a superior service at a lower price, I don't know, but what
> I do know is that a percentage of your customers came to you not because of
> your service, but because of your lower prices.
>
> Other dealers apparently followed suit and lowered prices with the result
> that the market in your area has now been cheapened for everyone.
>
> Despite the fact that you may offer better service, you have contributed to
> the lowering of prices in your area by pricing your services lower than the
> going rate, and as such you should be one of the last to complain about the
> "cheapening of the market" or about those looking for the lowest rate
> possible.
>
RHC: Well, I suppose you can say that and it's partially true. When I
first got into business, I wasn't sure where I should be price wise. I
had already decided how I wanted to play the game with a totally
trouble free service to my customers. I had also just recently retired
from a large telecommunications firm who I knew had sophisticated
rates calculating software that they had developed over the years at
significant cost, and which they used to justify all rate increases to
the federal government regulating body. Although their software took
inputs from hundreds of cost sources, I had a friend I knew there run
my figures through the mill, and it came out with a range of monthly
rates from $13 to $17 a month for best long term stability given that
markets would head downward in the future. I arbitrarily took the
middle ground, and it has worked out well for me.

So, yes, in that sense I contributed to the lowering of prices, but
things have since gone from the sublime to the ridiculous. Many
companies charge $12 full service all the way down to $9 no service. I
know that they are not making money overall, unless my previous rate
calculations were way off. But the real problem lies in the poor
quality of their installations and service. Lowering of the bar in any
industry is not just about money; it's about the ongoing overall
lowering of quality which matters more when all is said and done !