If the local Lowe's is getting $3.85, then thats what the market will bear....you don't think they picked that number out of thin air do ya? They are selling people on the fact that are a large company that knows what they are doing,(yeah right) and will be around should problems occur. You can market and sell yourself too...look at R&D's post above to get a few great ideas.
I average $3.75sf on ALL products that I install....talk to the majority of the "floor guys" around here and they are still charging by the yard on sheet goods, are well under $2.00 a foot on laminates, and are around $2.50 on pre-finished hardwood
...The difference is I am running a business, they are installing floors.
Set yourself apart....if you price yourself according to what "everybody else is getting" then you are lumping yourself right in with them. The only thing your prospective customer has to make a decision by, is price. Just by charging more, I have had customers ask (it peaks their interest if they are quality driven) "Why do you feel like you are able to charge that much" Hell thats an invite for a close if I ever heard one. Thats your chance to show references, portfolios, manufacturers specs as to why you can't do it as cheap as the last guys estimate, etc., etc. Show that you know what you're doing, in other words. Thats also my opening to ask them if they take their Lexus, Jag, BMW, Volvo (or RV, Boat whatever you saw parked in the driveway) to the cheapest guy in town for service? 99.9% of the time they will say no....Why not?? That's a rhetorical question at that point. There are numerous ways to sell a higher price if you pay attention, and get out of the mentality that you have to be cheap to get business.