Importance of Pricing Policies

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Pricing integrity improves customer satisfaction, manages expectations, and builds loyalty. Creating a pricing policy will guide staff in this area and will protect you from liability.

Significance

  • Pricing that changes with different customers can bring price discrimination charges under the Robinson-Patman Act and carry substantial penalties. "Bait and Switch" advertising by luring the customer to buy an advertised item only to pressure them to pay more can bring charges too. Violating these and other laws also will hurt your reputation and hinder referrals.

The Plan

  • Address three main points: outside advertising, negotiation and in-store signage. To comply with law in advertising, you must "show, tell (about) and offer to sell" any advertised item. Have working displays, train staff about item features and instruct them not to discourage the customer from buying the product. Negotiation is acceptable as long as it is not done on the basis of protected classes (race, gender, etc.). In-store signage must be dated appropriately. If an item is tagged on sale without a clear expiration date, you must sell it to the customer.

Implementation

  • Clearly post these considerations in your policy manual and make them part of ongoing training. Review each advertisement with staff, and document substitutions and rainchecks as needed.

References

  • Photo Credit sale 70% off sign. all sale sign. free.cheap price image by L. Shat from Fotolia.com
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