Sell at a Higher Price by Building Perceived Value
RCS Influencer Martin Stout says that price is the last component of a good sale and focusing on price is the last thing a good contractor should do.
Often, we think if we can get our prices up we can make more money, however focusing on efficiency will move the bottom line faster than trying to move the top line with price. A wise old roofer told me many years ago and he continues to tell me (thanks Dad) “profits are the wages of efficiency.” I don’t know if they are his words or if he got them somewhere but his point is well placed.
If you raise your price 10% but you are not efficient you could wind up spending 11% more to get the job done. But if you figure out a way to get the job done just 2% more efficient you can keep you price low and have a little extra to add to the bottom line.
We are all in business to make money, and use it to, in some cases, save the earth or whatever the government allows us to do with it. So, to make higher profits and get a higher price here is my suggested formula:
Work hard and developed a program that works well and is efficient.
Good communication, quick response, on-time quotes that are the final price, no surprise extras, quality workmanship, clean jobsites, and quick follow up after completion. Pay your suppliers quickly and let them enjoy having you as their customer, make them want to service your account first. Engage your team to be involved and share ownership in the relationship with the customer. These are the high points.
You will have customers that are willing to pay you the price you ask because it is efficient for them, we all like easy and effortless processes. If they are happy they will tell their friends and so on and so on.
Don’t try to sell at a higher price than your competition, price is driven by the market and perceived value. BUILD VALUE!
Martin Stout is president of Go Roof Tune Up, Inc. See his full bio here.
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