Know-How Exchange : Strategy

I am the authorized distributor of an made-in-Europe high-end sports equipment. This brand and its product is available all over the world.

When I first started importing and selling this product in my country 5 years ago, I priced it to accommodate import duties, marketing expenses etc. So far my sales is growing as more people get to know my product through advertising. However, recently more and more people are buying it from overseas because they can get the very same product from nearby countries at a cheaper price. And the internet has made it easier for them to buy this product from other countries thru e-commerce. Even the authorized distributors in other countries are selling cheaper than me.

I am starting to wonder if I should reduce my price to be closer to the price set by authorized distributors of other countries. That would mean I have to reduce my price by about 10%-15%. Some people tell me to add value to the product instead of reduce the price. But I was wondering how to do so because this product is the same all over the world. For example, a Swatch watch is a Swatch watch no matter which country you buy it from. So people are asking me why is my price higher than other countries when they are the same item?

I also don't want to give bigger discounts because it may affect the image of the brand. That's why I thought of reducing the price once and for all.

Over the last 5 years my business is growing slowly, but I thought if the price is reduced perhaps it will grow faster?