Do you fear losing customers?…or not winning enough NEW work if you raise prices?
You’re not alone. Many lawn business owners worry about the same thing as you.
Hear this…Raising Prices is a serious matter. It requires careful consideration. The thought of raising prices keeps many contractors up at night.
In fact, I’ve seen this problem destroy lawn companies.
There are 2 ways to price yourself right out of the market.
You price yourself out of the market by going after the wrong type of customer.
Most contractors think they have really high prices. They believe this because a good number of people say things to them like, “Your price is too high“. After hearing this from a few dozen people… you will start to believe them! However, in many cases, you are told “your price is too high” because you are presenting your price/proposal/quote/estimate to an unqualified prospect.
You price yourself out of the market by offering super-cheap prices.
Many times, these are the prices you got from a local competitor. The guy you met at the fuel station…the one who looks like he has nice equipment.
Super cheap prices can kill your company FASTER than poor workmanship.
Educated buyers are quick to spot prices that are too low. These high-end educated buyers don’t want the hassle of a price they know will not be adequate for a pro to do the work 100% the first time.
Here’s what I’m saying: Super cheap prices repel high end buyers.
WORSE… super cheap prices DO NOT allow adequate profits. A low-priced contractor may win lots of jobs, but ends up working endless hours with little to show in their bank account.
After a few seasons of back breaking work, these contractors discover their equipment is worn out, their bodies ache, and their customers seem unappreciative of their services.
The contractor quits in frustration saying things like “you can’t make any money in this business” or “people don’t want to pay enough for me to make any money“. (Does any of this sound familiar to you?)
In either case…the low-priced contractor was wrong. You CAN make money in this business and there ARE clients that will pay you the right price.
However… pricing work for lawn and landscape services is a careful balancing act.
You must Price Right for your company so you cover your direct costs of labor, equipment, materials and subcontractors.
But simultaneously, you must Price Right for your customer. Every customer has a budget of some kind. When you provide the right information to prospects, and ask the right questions, you can discover their budgets or buying criteria. Then… you must prepare proposals that respect their budgets.
Armed with a clear understanding of the customer’s budget… your job is to know your costs so well that you only provide profitable proposals that fit the budget.
After working with more than 300 owners of lawn and landscape companies, I’ve discovered TWO very important secrets.
1) MOST lawn and landscape business owners FEAR raising prices.
The only solution to crush this fear is…
If you have been reading The Wealthy Landscaper Letter series on the subject…
You know I believe the cost for labor is GOING UP… (Here’s the article and audio recording that explains the details).
2) CONTRACTORS will NEVER run out of work because they raise their prices!
Contractors go out of business because they take on too much work too fast and can’t control the cost of labor and overhead. That’s what crushes contractors!
Let me know what you think about my comments today.
ARE YOU AFRAID TO RAISE YOUR PRICES?
Tony Bass, founder
PS – If you are having trouble in your lawn or landscape company, I’m here to help. Just follow this link and schedule a 20 minute strategy session. We will figure out what the best approach is for your situation.