Value-based pricing, VBP, is the most highly recommended pricing technique by consultants and developers. The basic concept is setting a price to capture the majority of what customers are willing to pay. Princewill Ekwujuru spoke to Bukola Gadzama, CEO of BuildCon Global Services on this differentiation.

Competitive pricing has been described by marketing experts as setting the price of a product or service based on what the competition is charging. Competitive pricing is used more often by businesses selling similar products, since services vary from  business to business  while the attributes of a product remain similar. This type of pricing strategy is generally used once a price for a product or service has reached a level of equilibrium.

It is with this reasoning that Bukola Gadzama, Chief Executive officer of BuildCon a major player in the real estate sector in Nigeria leveraged to create a differentiation in the sector with unique pricing that endeared it to  customers. The company running since 2013 has build over 16 units of houses and has instituted a payment plan for houses that is light for customers.

Her words, “We also give customers a payment plan of between 2-3 years, that helps and reduces the pain of outright payment. We encourage them to pay 20 percent initial deposit and they can spread the balance over the remaining number of months. This helps achieve ownership of the homes.   For those that cannot afford the detached spaces tend to go for semi detached or the terraces”.

Bukola told  Vanguard that because of the payment plan, the company has agreement with its customers that with every payment, there are milestones he or she is expected to see in the construction of the building. “When you don’t see those milestones you are not obligated to continue payment”.

With the spread payment plan, the intention of the company that is building more estates in Ikota area of Lekki, of Lagos is to make more people buy and own their homes. “We are looking further to beyond the Ajah axis to construct more houses that are affordable for more    income brackets”.

Explaining that when somebody deposits money for a house and one year after, he/she could not continue to pay, Bukola said “What we try to   tell our clients is   that as soon as there is an issue let us know. We are also human even though we are in business. If we understand what the issues are, we can give you some time frame to continue payment as long as it is within the time we have to deliver the estate. If you feel that the issue is beyond you and you might not continue we would help you sell the building and refund you”.