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Does anyone have any ideas on how I can up my prices?Whenever I go to price a job my mind thinks one price but my mouth speaks another(usually lower)A lot of my problem is I live in eastern Canada where there always seems to be someone with a better price.Even though they are inexperianced the custemer just sees all the money they are saving.I strive to do quility work but that don't seem to matter.Also,I am afraid to ask to much and end up sitting home worrying about how I will make payments.I also have two employees I feel I have to keep busy.I thought about moving to a more populated area where there might be more work but thats a major move.Does anyone else have this problem?
 

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kanadaeh said:
Does anyone have any ideas on how I can up my prices?Whenever I go to price a job my mind thinks one price but my mouth speaks another(usually lower)A lot of my problem is I live in eastern Canada where there always seems to be someone with a better price.Even though they are inexperianced the custemer just sees all the money they are saving.I strive to do quility work but that don't seem to matter.Also,I am afraid to ask to much and end up sitting home worrying about how I will make payments.I also have two employees I feel I have to keep busy.I thought about moving to a more populated area where there might be more work but thats a major move.Does anyone else have this problem?
Don,t worry about what the other guy is charging unless he providing exactly the same level of service as you,in that case you may wish stratigize your pricing so as not to be way out of the ballpark with your estimates. Notice i said stratigize not charge the same or less. In this era of big boxes a small contractor cannot sell on price alone to be successful .You might want check out the current thread on working for the big boxes,this is the future for lowballers.
 

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...jammin
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Yeah it's tough sometimes, you don't want to let a job slip by you
And customers are so focused on price alone

I have learned:

If you never lose a job because you are "too expensive", you are not charging enough

People who shop on price alone are not a quality painter's customers anyway
 

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DGR,IABD
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I strive to do quility work but that don't seem to matter.
Define "quality work". When you are able to define that term, and effectively relate that to the customer and explain why it is important to them, you won't have to explain your price.

It's too easy to say you do "quality work". Heck, everyone thinks they do quality work. Seldom, if ever, do you find a tradesman say to a customer, "Hey, I can give you a really good price because I only do a half-a$$ed job.". You need to show the differences between quality work and inferior or substandard work, and define the consequences of getting a less that quality job.
 

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I've made it a rule that a customer who is only focused on price is not my customer. I explain to each customer what we plan to do and how we plan to do it and explain how others might cut corners and why it is important not to cut the corners.

If the customer says someone else is cheaper I just agree and smile proud that I am more expensive. It really gets a reaction from the customer almost makes the stumble and bumble every time. Then I once again explain how cutting corners is easy to do and why not to do it and offer to review the competitor's proposal on their behalf. If they give me the competitor's proposal I tear it apart. If they only have a verbal I tear it apart. If the proposal is comprable to mine in scope of work, but not price I double check my math. Yes I have made mistakes from time to time.

Selling on price is not selling. Convincing a customer to be proud to pay more is selling, but it's not that hard to do really.
 

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hiring a gc is similar to buying a car. there are several levels of quality and price. some people buy the ford focus because it's cheap. then they can't wait to trade it in on something better. these are the people who hire the fly-by-night guys with 10 illegals working for them, who can slap something together in a day and a half. some buy a mercedes because it's expensive, and built at a high level of quality and craftsmanship. these are the people who hire the big companies with truck fleets and formen who practice management-by-walking-around. the point is , if someone is looking for cheap,they're going to BUY cheap. it won't matter from who. if someone is looking for quality,they will pay for it if they can afford it. they will also pay for what appears to be quality,even if it isn't.(i.e.-the big cookie cutter gc guys.) ask your prospective clients to get other estimates. test the market waters so to speak. also tell them to request pictures of the work of other gc's giving them estimates. tell them if you're able to beat other bids you will. you'd like to show them your work in comparison to other gc's. when you show your stuff, explain to them that this guy may be cheaper, but look at what you get compared to me. you may lose a few, but those you win over will respect you more. and if you give them something worth talking about, they will . and your bottom line will be better for it.
 

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Custom Builder
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Kan. think about this for a minute:

It's one thing to ask for big money, it's something completely different to ask for big money and expect to get it.

Just expect to get it.

Bob
 

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point taken, but depending on your rep and experience, sometimes a little comparison to show you SHOULD get it goes a long way towards separating a man from his money.not a tactic i have to use now, but i did early on occasionally. it worked more often than not.
 

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Back from the dead...
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Here is something I ripped from another board, a long time ago in a galaxy far, far away. Wish I could give credit to who wrote it, but that has been lost with time.

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

Higher price does not necessarily mean a higher quality job, but will usually reflect a higher quality company. We are often 2-3 times the cost of some of our lower priced comrades in whites. Some of which do very fine work, equal to or even exceeding us at times, others of course do very poor work.

What the higher price does give customer, at least in our business is a very high quality company with which they feel comfortable doing business.

Why is that important?

Business people like to do business with successful businesses.

By charging higher prices we are able to offer our customers:

Flexible scheduling because we can hire and train more qualified personnel

Consistency by being able to retain high quality and highly qualified employees from year to year

We are able to empower our foreman to handle the entire job from start to finish including all their own scheduling of crews, equipment and supplies.

Jobs get done quicker and in a more timely fashion than the 1-2 man shop that can't grow because they price to low to run a real business.

Higher prices mean you are able to service your warranty work efficiently without losing money on call backs or repairs.

Higher pricing means you can retain the best employees with the best attitudes to service your clients.

Employees enjoy full time work without down time, company supplied uniforms, health insurance, life insurance, workers comp, retirement and paid vacations, plus bonuses.

None of this is possible by charging half of what we charge.

Basically, the customer stands a better chance of dealing with a company which will be around to service them with confidence and consistency for years to come, even if the owner breaks an ankle.

The customer gets better value by having piece of mind, even if the workmanship is equal.

Charging the right price leads to a better quality of life for your employees. Better service for your customers. Better income for you and your company.

Too many contractors in all the trades sell themselves short and as long as they are working for just wages, they would better off working for a company like ours.
^^^^^^^^^^^^^^^


And there you go. :Thumbs:
 

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I thought I'd share an article from our companies newsletter, which touches on this subject.


Whippany, NJ
August 1, 2005

Have you ever wondered why HARRY POTTER and The Half - Blood Prince is talked about as the savior of the publishing industry? Have you marveled at how the author became the most wealthy woman in England?

Among the many complex reasons, the simple one is that Ms. Rowling has made an intimate connection to her customers, mom, dads and kids under fifteen.

The more basic answer to the question is that all sales are emotional. Whether you sell books, investments, industrial products or services, people buy emotionally and justify their decision on the basis of facts. Think about it.

You might admit you buy services or products that fulfill an objective purpose, at a price, but ultimately you buy those that make you feel good about yourself. Simply, “feeling” is emotional, product performance and price are empirical; they justify why you made your decision.

When selling your products and services to customers, the first and most important consideration is who your customer really is. That question is not only about an address or NASIC code, but ultimately why they want to buy the product you sell. Then the next question is why they should competitively buy from you.

This may not be an easy question to answer, but key for you is to answer why your company is the best vendor on the planet to buy from? That answer to that question is called the unique selling proposition (USP).

The USP is what makes you the most preferred supplier your customers can use that is based on a key product or service attribute. At a personal or emotional level, you want them to buy on trust. When customers talk to you, the confidence you project about your product and your pricing is key to gaining rapport and trust.

At a practical level, you must prove your claim with some experiential, testimonial, patented ingredient claim, exclusive license or some other demonstrable reason why.

In personal selling, projecting an image of confidence reinforces all the other attributes of the claim – that you and your company are vendors of choice. Here is where the value proposition connects the promise of real value. If your price is too low for the claimed benefit, the claim is not believed and your claim is not trusted. If too high, the value of the claim is lost.

Owners of services that charge based on billable hours must know their true cost of operations. When you know your company’s true cost and profit structure, you are able to sell with confidence.

With knowledge about your customers, confidence in your product and pricing, you are able gain your customer’s trust, build rapport and realize more effective selling.


• Confidence
Knowing Costs Improves Selling and increases revenue
o All sales are emotional – the power of self confidence
o Focus on your customer needs and values
o Price to value
• Know your costs to sell and price with confidence
• Take no as a request for more information
• Explain the value of your quality and price

Thanks
Electro
 
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