If it's a job that's worth a few grand, it might be worth going the box store route and matching your competitor's price. If it's a job I want and the customer really wants to use me but is hung-up on a hundred bucks, I'd offer to split the difference with them or even match the other guy's bid. If it's a smaller job that I don't want to do for less, I'm with Michael. Quality doesn't always come cheap. Encourage your cutsomer to ask lots of questions of both of you and even give them some pictures and references.