Price elasticity guys. Basic economics I think you should’ve learned in high school.

Certain items people are price sensitive to and are willing to pay more based on quality. Others are fully price insensitive and people will choose solely based on price and not brand (like gas).

There is no universal advice for “do/don’t compete on price.”

Figure out if people are willing to pay more for your items. Usually the answer is yes, but you will get more sales and revenue undercutting price slightly AND providing a better product. This is what I do. Every time I get overloaded with sales I increase price to match competitors and sales (and revenue) drop to almost 0. When I want more sales I drop my price a dollar below competitor and things ramp up real fast.