Avoid the Capacity Trap: Why Discounting to Fill Unused Time or Inventory Destroys Hidden Value

Hard - Requires significant effort Recommended

A freight hauler leases a truck and hires workers, charging the going rate. When business slows midweek, someone offers to fill the gap—but only if the hauler slashes prices by almost half. It seems logical: 'better some money than an empty truck.' But this small win turns out to be a slow leak, draining cash and energy for less and less reward, turning his best-paying customers sour when they find out. Many businesses—fitness studios, freelancers, service pros—fall into this trap, using discounts to fill every spare moment, only to wake up competing against their own lowest offer. Hard numbers reveal the truth: it’s nearly always better to let the slot go idle, or use it for strategic development, than to give it away at a loss. What feels like being productive can actually drag you down.

First, get honest about where you have spare time or inventory—don’t hide it from yourself. Figure out what it actually costs to fill those gaps, not just in cash but in distraction and risk. When someone asks for a deal, pause and consider: could you use this space for something new, learning, or a premium option instead? Try using the time for self-improvement, higher-margin planning, or building a true value-add. Only offer special rates for unique, non-recurring situations. This shift may feel scary, but watch how much more valuable your work and confidence become.

What You'll Achieve

You’ll gain higher profit per hour, protect your strongest customer relationships, and experience a new sense of strategic control rather than chasing fleeting deals.

Resist Discounting—Reframe Unused Capacity Instead

1

Identify your 'empty slots.'

List underused assets: hours, inventory, resources, or talents that often go idle.

2

Calculate true costs.

For each slot, figure out costs not just in money, but also energy and attention. Add up labor, supplies, and opportunity costs.

3

Refuse knee-jerk discounts.

When offered 'something is better than nothing' deals, pause. Instead, ask what value you truly want from those resources.

4

Develop a clear premium or value-add offer.

Design high-value packages or exclusive bonuses for times of excess; never offer the same product/service for less, except for unique, time-boxed experiments.

Reflection Questions

  • How does it feel to say 'no' to a bad deal?
  • Where have discounts come back to haunt you before?
  • What positive use could you make of your next idle hour?
  • Who benefits most when you protect your long-term value?

Personalization Tips

  • A violin teacher with empty lesson slots offers ‘master classes’ at standard price instead of discounts, sharing rare tips with smaller groups.
  • A garden center repurposes unsold plants for a school project rather than slashing prices and undercutting regular shoppers.
  • A local gym hosts training workshops during daytime lulls, inviting premium guests rather than discounting memberships.
The Knack: How Street-Smart Entrepreneurs Learn to Handle Whatever Comes Up
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The Knack: How Street-Smart Entrepreneurs Learn to Handle Whatever Comes Up

Norm Brodsky
Insight 6 of 8

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