Would You Charge Rich People More?

john elliott

Let's suppose you are doing reasonably well, got plenty of work and plenty of leads.
You get a call and are asked to quote for some straight-forward work, let's say it's something you would normally charge $10K for. It turns out that these people are very rich.

How much extra, if anything, would you ask?
Are there any ethical considerations?
Are there any marketing considerations?

If it happened to me, I would probably ask $15K.
No ethichal considerations as far as I am concerned.
Marketing considerations would be that these rich people are not expert in my line of work, and the only way they can judge the value of it is by the price, therefore the price needs to be high enough to assure them that they will be getting a top quality job.
On second thoughts. nmaybe I should ask for $20K?

What say you?

John

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Ed the Roofer said "John too, in his crass and blunt demeanor.............."

SelfContract

Rich people care more about QUALITY, & EXPENSIVE TOUCH/FEEL/LOOKS, etc.

Patrick

I say charge as much as you can, However, you should be charging everyone as much as you can. If people are willing to pay it, why not take it?

RizzoMaryland

Market value equals what a buyer and seller agree on. Nothing ethical about it. However if you are working for someone and hit them with an additional charge/change order that is unreasonable then it tiptoes on unethical since you are taking advantage of the situation.

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"An idea is salvation by imagination"
Frank LLoyd Wright

john elliott

I should have covered this in my original example, and apologise for not doing so. Let us make the example clearer by saying that it has been found that a price of $10,000 is about right, gets a good closing ratio and has been found ideal for the service and the market within in which it is normally sold.

If one could charge everyone more money then naturally one would do so, but let's restrict this to the unusual circimstance of some unusually rich people

John

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Ed the Roofer said "John too, in his crass and blunt demeanor.............."

WNYcarpenter

Just my $.02....

I think ethics should play a part....You're not overcharging as long as someone is willing to pay. Are you underpaying your guys as long as they're willing to work?

It's my feeling that wealthy clients have the money to spend that allows them to have the best quality money can buy. They drive BMW, Lexus, and other luxury vehicles because they want more than Ford has to offer.

Ethically, IMO, if a job can be sold at 10K, but you ask 20K they should get 20K worth of service....

granted, many clients don't know the difference and if you're already booked...why not ask for more if fitting them into your schedule will be a major PITA. That's supply and demand... Raising your rate just because a client is wealthy and may not notice is bordering on dishonesty, and toying with consumer trust which damages the industry as a whole.

That's my take, I'm a bit naive and idealistic and likely why I'm not a business man. This is an interesting topic and I'm also curious what some of the more business savvy members have to say.

PressurePros

I think upcharging would be very shady unless you had a published tier rate based upon income (which would land you broke)

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Ken Fenner
Pressure Washing PA
Roof Cleaning Services PA

tnt specialty

Been a contractor since 1983.
I'm with WNY.....
The thought has never crossed my mind.
Shady........

ruskent

I do not charge rich people more, i just refuse to work for unwealthy people.

skyhook

Wealthy clients can afford to pay the prevailing rate and changes when they pop up. I would structure my contract to reflect that. Also leave only a small percentage as a final payment, in case you have to walk away without it.

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Patrick

I will add to what I said earlier, Regardless of what you charge, you have to provide $xx.xx worth of service. For example in my business, we would upgrade them to our higher window line and higher grade siding, with nicer trim, as a standard package, promoting that for $xx.xx they are going to have the sharpest looking house on the street. If its a refferal job, NO way should you try to up your price without adding some sort of additional benefit. , people do talk.

LNG24

Of course you are assuming that wealthy people just stumbled into it and don't have a clue of how business works. Those that are wealthy and don't know about business, have business managers that do. Those that are self made, did not get there by paying more for anything!

I charge based on what I need to make a living and support myself in my lifestyle, pay for my overhead and keep my business going. I have done work for Multi Millionaires as well as people that are barely making it. My rate is the same. If I feel particularly sorry for someone, I will work charity and do it for free, which I have a few time. I have also Walked Away from a Very Wealthy individual because he felt he owned me and my time. He did not care other people had signed up for work before him and I had work scheduled after him, he felt that once I was on site, I was all his. I was surprised when I first arrived at his house, a Mansion that was just two years out of a major renovation. There were more Punch List Items than any renovation I have ever seen. Quality of work was very poor. After working for him for a week I knew why. He did not appreciate anything you did, he wanted everything cheep. You know, the kind that buys Jaguar, $10k Frig, Commercial Stove (and doesn't cook) and then wants everyone to install it, maintain it or fix it CHEEP. We had a discussion on Friday and I pack up my tools, loaded up my trailer and thanked him for the business. He paid me and we parted ways.

So, the Wealthy people I have come across are either really cheep, or expect the best and are ready to pay for it, but you better be able to deliver it as well.

If it costs $15k to frame a 2000 sf house, then I don't care if you make $300k a year or $30k a year. As long as you can pay me.

Slyfox

I charge X amount for labor and material no matter the home owners financial status.
Like a few others stated allready if their well off i will suggest higher grade materials which would result in higher labor cost because higher grade materials involve more labor thus more time consuming.

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leakygoose

A reputation for quality always sells for more . The market of supply and demand works . Charging rich people more for being rich will get you less. I perfer to only charge lawyers,doctors and engineers what I call an aggravation charge just cause they piss me off.

Jason Whipple

I like that!

It's becoming my new mind set

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Jason E Whipple, General Manager
Historic House Restoration, Cincinnati, Ohio
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silvertree

Charge what the market will bear!

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Vote for Pedro
Kitchen, bath, St Paul remodeling
Minneapolis Remodel Blog
203K Loan Consultant Minnesota

Brian

I don't charge wealthy people more, and I don't charge poor people less either.

Brian Phillips

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Houston Interior Painting
Houston Exterior Painting
Houston Painting Contractor

mahlere

just out of curiosity...how would everyone feel if the restaurant around the corner from you charged based on your income?

Mike Finley

$10,000.

What's the discussion?

That's the goofiest thing I have ever heard. (well, at least the goofiest today)

Once again: A real MAN's ethics and morals do not change based upon how much you think you can get away with or what the odds are of getting caught.

ruskent

But isn't capitilism charging as much as the market will bear? What happens if someone who makes 100k is willing to spend 30k on a bathroom and someone how makes 300k is willing to pay 45k for the same exact bathroom remodel. There is nothing wrong with charging the extra 15k! If people hire you for the job your price is not to high.