In the ready-mix concrete business, competition is fierce and margins are thin. It’s tempting to slash your prices to win the next big project or to keep a long-time customer happy.
But over time, this approach doesn’t just hurt your business, it chips away at the entire industry’s health.
In this blog, we’ll look at why undercutting prices is a trap and how you can protect your profitability and reputation by shifting to a value-based pricing strategy.
The hidden cost of always lowering your price to win a job
On the surface, discounting seems harmless. One small price cut to secure a deal feels like a smart move in a competitive market.
But here’s where it gets dangerous: once you lower your price, it becomes nearly impossible to bring it back up. Competitors match your discount, and before you know it, the entire market expects concrete at that new, unsustainable price.
Imagine this scenario: Producer A reduces their price by $5 per yard to win a project. Their competitors quickly match that price to stay relevant. Eventually, $5 per yard becomes the new baseline, and everyone’s margins shrink. When it happens over and over again, nobody wins.
Price cuts also erode trust. When customers see prices fluctuating, they question your reliability and the real value of your services.
As we’ll explore next, these discounts don’t always create the customer loyalty you hope for.
Why your customers don’t always benefit from your discounts
Many producers believe that low price is the only thing their customers care about. But when you look closely, you’ll find most buyers are willing to pay more for reliability, consistency, and peace of mind.
Lowball pricing often comes with tradeoffs like:
- Reduced service levels.
- Less investment in equipment and quality control.
- Higher chances of delays and mistakes.
Over time, those issues cost your customers more than the discount ever saved them.
When you focus only on offering the lowest price, you miss the chance to position yourself as a dependable partner—one who keeps projects running smoothly and on schedule.
The true cost of discounting goes far beyond the immediate sale. It sets you up for a cycle that’s hard to escape and doesn’t always translate to increased profits. Here’s how.
How choosing volume does not equal profit for your business
It’s easy to think that winning every deal and keeping your trucks busy means your business is thriving. But high volumes don’t guarantee healthy margins.
When you cut prices to win more jobs, your cash flow suffers. You’re moving more concrete, but at lower profits per yard. And every time you do it, you set a new benchmark that erodes future profitability.
Consider this: losing just $2 of margin per yard on 100,000 yards of concrete equals $200,000 in lost profit. That’s money you can’t reinvest in equipment, technology, or people.
Read our blog on cost management for construction material suppliers to understand how hidden costs may be eroding your profits.
So, what is the alternative to not cutting your prices? Value-based pricing.
The case for value-based pricing in concrete supply
Value-based pricing is the opposite of reactive discounting. Instead of racing to the bottom, you focus on delivering and communicating the value your business provides.
At its core, value-based pricing means quoting based on service quality, reliability, and the total impact you have on your customers’ projects.
Producers who succeed with this approach do a few things differently:
- They communicate clearly with customers about why their pricing reflects real value.
- They back up claims with data: on-time delivery rates, product consistency, and safety records.
- They show how dependable service reduces costly delays and project risks.
When you take this approach, you’re not just another commodity vendor. You become a trusted partner.
For example, you can explain to a customer that your pricing allows you to properly staff every job, maintain reliable equipment, and resolve issues before they escalate.
This peace of mind is something no discount can replace.
But quoting the right price in a fairly in a dynamic market, isn’t always simple. That’s where Slabstack comes in.
How Slabstack helps you quote confidently with value-based pricing
Many producers discount because they lack visibility into their true costs and margins. It feels safer to offer a lower price than risk losing a deal.
Slabstack changes that. With our CRM and quoting platform built for ready-mix and concrete suppliers, you can:
- Access live cost and margin data, so every quote protects your profitability.
- Enforce margin floors and approvals, ensuring no quote undermines your targets.
- Quote faster, with confidence, so you don’t default to discounts out of fear.
- Analyze win/loss data to see what’s working and refine your pricing over time.
When your team has the right tools, you don’t need to compromise on price to compete. By leading with transparency, discipline, and a focus on long-term value, you can set a higher standard.
And as a result, the concrete industry doesn’t have to accept shrinking margins as inevitable.
Ready to see how much margin you could protect? Book a demo or request a cost analysis today.
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