Price Means Nothing

Paul Staub

I know this has probably been said before, and I might win "captain obvious post of the week" but I'm saying it anyway.

PRICE MEANS NOTHING

I have sold for 2 companies who charge what many of you on the board would call outrageous prices for windows (600-1500 each), but have found little difference in the ease or difficulty of selling at 1500 each or 600 each. In fact my closing ratio only increased 5% when switching from the $1500 company to the $600 company. And this was probably just do to higher qualified leads.

As long as your price reflects the perceived value of your service to the customer, they will buy.

I'm not sure if id be able to sell a moderatley priced window, I don't think id know how.

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-Paul

mtp

and for some quality means even less

Paul Staub

and in the case of the first company I worked for, neither seemed to really matter, thats why I quit.

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-Paul

Grumpy

The situation is this. Some people are quality buyers and some are price buyers; and furthermore some buy a balance of the two.

Heres the real kicker the salesman has to believe in what he is selling or he's gonna have a real hard time selling it.

I worked for a small contracting firm and we were charging $325 (starting) a window and some guys were undercutting us by $100 per window! I still can't figure out how that's at all possible. Then I briefly went to work for one of the big box companies and just have no faith in thier products or services because of my background. I left at my first opportunity. Right now I sell inbetween the small contracting company's prices and the big box's prices.

The point? Ahh yes there is a point. The point is I do agree with Paul. Price doesn't matter, because if the salesman believes in what he is selling and believe that it is worth what he is asking he will do what he can to convince the customer. If he doesn't believe in the product he won't have tthe drive to convice the customer.

BTW I don't think that replacement windows 80UI should be sold for $600 That's just robbery IMO, which is why I left the big box... I didn't believe in the value of what I was selling.

mdshunk

I have been treated to a few window presentations in the past. While I never did bite, the most impressive presentations (to me) were the ones with the highest prices. The salesmen (and one lady) offering the higher priced units always pointed out things like how much money they'll save, how nice they look, and how easy they'll be to clean. The cheaper units (and the most boring presentations) when into long gory detail about how the units were constructed and what kinds of what the peices and parts were made out of. I guess what I'm trying to say is that the old addage "Sell the sizzle and not the steak" sure worked on me.

housedocs

Interesting thread guys, good food for thought. What you're basically saying is to stay away from the technically aspects and key in on benefits to the customer.

Grumpy

Bingo!

I actually do both, technical and beneficial. What I mean is when selling windows I will say "Some reports state you can save up to 30% of your heating and cooling bills due to the soft coat low-e and argon insulation."

Here I am not just making a blatent claim, I am also backing up that claim with a reason. You have to understand that if you come up against an engineer as your customer he cares more about the steak than the sizzle.

Mike Finley

Speaking of window benefits, has anybody actually been able to show a real cost based analysis that shows how windows pay for themselves? It seems to me that saying so is a bunch of bull. Since the average person stays in a home 7 years. 10,000 / 7years / 12 months a year = 120.00 a month somebody would have to be saving on heating/cooling bills. Seems like it would take over 10 years at least just to break even. That would make it hard to convince me to replace windows on any property unless I just wanted them to look pretty.

PipeGuy

I'm with you Mike. I live in 40 rear old house with double hung single panes and storm windows. I've been pitched replacement windows on at least three occasions since living here these last ten years. Just to recover the replacement cost I'd have to reduce my overall energy costs nearly 50% over ten years. For me, replacement windows are no longer a consideration. Too many other improvements and activities take priority over new windows when it comes to the allocation of my tiime and/or discretionary funds.

Paul Staub

did you sell windows/siding or roofing/fencing?

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-Paul

WindowMan

Depends on what your energy costs are. Down here in TX single pain glass and a few months of 95-105 degree days and they pay for themselves real fast. One of my biggest selling points has been noise control. What does the average electric bill run up there. Most houses down here around 1500-2000sqft are $200-500 monthly. Ive seen many up in or around $500-1000 monthly .No a/c is impossible for 8months of the year . I would say the average home owner opens there windows here maybe 2weeks out of the year total.

Floorwizard

At our home show they displayed some windows that keep heat in amazingly well. Anyone deal with those?

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"in 20 years you will regret more what you did not do than what you did"

trekr

One thing to consider on energy savings is the fact that fuel is going up every year. If you factor in a 10% increase in cost of fuel the replacement illustrations start making more sense. Especially if you are making the leap from very inefficient windows.

Also, this ignores the resale value. In Remodeling magazine in my area they estimate that 80% of the cost can be recouped on resale.

Paul Staub

Its not all about recouping costs. Its ridiculous to think that window replacements wouldn't benefit someone whos windows are drafty, leaky, and inefficient.

People have numerous other reasons to replace their windows outside of a return on investment.

-No more painting
-Easier cleaning
-better overall look of the house
-transferable warranties
-eliminating drafts/leaks
-current windows do not operate, customers want the ability to vent the windows
-no more condensation
-repairing rotten sills stools stops or casings
-changing the style of an existing window (ie installing a bay or bow window)
-having a company availabe to repair window problems over time
-increasing the strength of the window for more security


I have never ever in the history of my home improvement sales career had a customer tell me that they saved no money on their energy bills. And I call many of them months after the fact to make sure they are satisfied (and to get them to buy my other products )

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-Paul

Mike Finley

Paul - good information.

Often the true benefits of a product and the reason a customer wants the product have VERY little to do with each. For example people buy 4x4 vehicles and never engage 4x4 low during the ownership of the vehicle.

What did you find were:

1) The #1 reason people were wanting to replace thier windows?

2) What was your window companies #1 selling feature of the windows you sold?

trekr

I don't know of many improvement projects that make sense on a totally financial basis. Howevever, I don't think a 25-30% reduction in heating/cooling costs is out of line when upgrading from old single pane windows. http://www.efficientwindows.org/energycosts.cfm

If you make a $5k investment that adds $4k to your property value immediately, the true cost you are trying to recoup is $1000. Economically, you are shifting $4k from a cash asset to a home equity asset. And given the appreciation that real estate is seeing, you're probably earning a better rate on the $4k in the house than in the bank.

And again, this ignores all the reasons mentioned above such as maintenance/beauty etc. To me it seems the motivation for customers to buy is primarily the list above, but the energy savings/resale value makes the project make even more sense.

Floorwizard

I was just wondering if you have used any windows that kept in heat better, and what were they.

I have no math...Nor will I provide any. I didn't join this thread to argue, I joined to ask. I have NO experience with any windows, so I cannot and will not argue anything.

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"in 20 years you will regret more what you did not do than what you did"

Mike Finley

Sometimes the truth is that adding $5000 worth of windows to a house is probably not going to add $4000 to the value of the house.

The problem is that alot of projects like adding windows don't add value because they fall under the "It's supposed to have those anyways!" category. As in the guy who tells you he has a rebuilt motor or he just had the breaks fixed on his car and thinks it is worth more - the truth is, the motor is supposed to work and the breaks are supposed to work anyways so no value is added for doing what is supposed to be there in the first place.

Houses are almost always appraised using previous sales of comparable homes, so the comps aren't necessarily going to show you getting $4000 bucks for your $5000 window investment, they could fall under the "it's supposed to have windows!"

Sometimes good old appreciation covers a multitude of homeowner improvement sins over the long run.

trekr

Mikesewell,
If your allusions of dishonesty are somehow directed at me they are misplaced and not appreciated. You certainly do not have enough information to determine my level of ethics. If your comments were general in nature, ignore above. I am simply trying to point out that I don't necessarily agree with all of your logic.

Windows, by the way, have been peripheral to what I've done in the past-- although I'm investigating the possibility of focusing a little more on window sales. When I've sold windows I haven't used a xx% energy savings illustrating a "pays you back quickly" scenario. I also don't use (as a selling tool) some of the energy savings guarantees some manufacturers provide. I do tell a customer that they should expect a savings but the amount of the savings depends on many factors such as existing insulation, caulking, w/s, existing windows, exposure etc. As anecdotal evidence I had a customer tell me his gas bill last month was lower than the year before. This is the only person I've heard this from, given the gas price increase over the last year.

How exactly do you propose to estimate the savings on a particular job? Do you set up blower doors and get out the thermo camera when you are selling windows? The math you keep referring to is dependent on the numbers you plug in. Where do you get accurate numbers for a particular property?

It seems as a practical matter we have to depend on generalizations and scientific studies to some degree. A discussion of them benefits everyone.

Forcraft,

The U factor you see on windows shows the rate of heat loss (lower the better). Divide 1 by the u factor and you get the R factor. There's some math.

Mike F,

Of course there is no guarantee of an 80% resale. This is again, a generalization. Albeit, based on Remodeling's annual survey of actual jobs. By the same token you cannot look at the $5k investment as an outright expense-- can you?

mikesewell

I prefer the use of logic, unless someone else has a better method.

Great. That's the honest way to do it, and the only way to do it. Hat's off to you.

Do an inspection of the entire building envelope, determine the square footages, determine the square footage of the windows, use the published R, K, or U values for all materials involved, and do a Q factor equation for total heat loss in BTUs over a given time period. Estimate the insitu cost per BTU. This method is used EVERY DAY by HVAC contractors, architects and engineers to estimate energy costs. It is THE accepted method.

Air infiltration is a separate matter, there are guys that specialize in doing this by creating a low pressure condition in the house and measuring air flow and pressure. It's not that expensive. Air infiltration issues can usually be taken care of relatively inexpensively, so generally that's a non-issue.

Using a "scientific" study provided by a window manufacturer is like asking a barber if you need a haircut. If your contractor is honest, he should be willing to do an energy audit on your particular home, show you the published r values, and SHOW YOU THE MATH.

Best Regards,

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Commercial construction

Sewell Construction