What a great business we’re in!
Over the past few years, I’ve made my own business a ‘lifestyle’ business. I have no staff (whereas previously I’ve had up to five), work a maximum of three days and take at least four holidays abroad every year. And I don’t ‘phone home’ to check the answerphone every few hours!
All this has been possible by effective marketing. Selling to the ‘right’ customers at the ‘right’ PRICE. And giving them ‘best value’.
So just the other day I thought about booking my first holiday for next year. I checked online to see what sort of price I would have to pay. Then I went into a high street travel agent to see if they could perhaps do a better deal.
The education in ‘pricing’ was invaluable.
There are at least four lessons that easily translate to our business of carpet cleaning.
Here they are:
The lady I spoke to immediately informed me that she was not a sales advisor but in fact was ‘cabin crew’. She was pregnant and so the travel agent was simply making use of her as cheap labour in the shop. After taking note of all my requirements, a total price came up on the computer screen. The very first thing that she did was to immediately say that she could discount the price as it seemed a bit high. As it happens the price was in the region of another quote I had.
LESSON 1. Make sure that everyone involved in selling has some sort of sales training and understands the psychology of the buyer. Otherwise they will react to price exactly as the cabin crew lady did here. And what impression did it give? That I was being overcharged to begin with!
LESSON 2. Don’t capitulate on price. People are buying value NOT price. People don’t buy a Mercedes just to get from A to B. Yet, Mercedes dealers don’t discount to compete with Vauxhall or Ford. There’s always more involved that gives them greater value. I always recommend using a computer program to come up with the costs so that it’s very hard to change the price. Many times my computer has produced a price that I thought the customer would never pay, only to be surprised. Customers can sense if we’re uneasy about our price and will then try to negotiate. I’ve repeatedly found that customers take the view that “the laptop has spoken†when it comes to price and simply accept it as “the priceâ€. Which of course, it is. And of course, if we provide a high quality service target Mercedes customers NOT Ford customers.
LESSON 3. If they want to change the price…you change the package. The price I was originally quoted for was All Inclusive and for a Water Villa over the sea. (Can you guess where I’m going yet?). So…could I drop down to Half Board or have a plain old bungalow by the waters edge instead of over water? If your customers want to change the price, get them to ‘empty the room of all furniture’ for example.
LESSON 4. Don’t discount…add value. Could she have added something to my holiday that costs them very little but has high perceived value to me? For example, how about pre-booked seats on the plane or late check out or something else that costs them very little?
Of course, if your clients are only concerned about price…it may be better to sack them and get clients that will pay more for a quality service. She asked me how much I was expecting to pay. I gave an artificially low price...about a thousand pounds less! (Don’t all buyers do this?) She then tried her best to see how low she could get the price. Instead she should have just ‘sacked’ me.
We mustn't be timid in explaining our prices to prospects. We must be able to confidently justify our charges compared to other cleaners. And do this in a way that our prospects perceive as ‘best value’ for them.