There will always be customers that will take the lowest bid no matter what. I am from Holland, Michigan and there are a lot of Dutch people here. When I say Dutch they are really of the Dutch heritage, hence the town's name. When you get those kind of people you just have to stick to your prices and just walk away. I also have seen people base there decision on how you present yourself and how much confident you are in yourself. If you are not confident in your service or your price sometimes customers can see that. I have also seen what Justin said to be true about them throwing out the lowest bid. I know that if I see someone pull up in a rusted out pickup truck giving me an estimate I would probably not go with him. Another guy could come up in uniform and a newer truck and give out customized bid sheets and I would consider him more. People have confidence in others who have confidence. Even if it is more money then the next guy. It doesn't mean that the guy in the rusted out truck wouldn't do a good job. Image does mean alto in this world. Especially when you are dealing with rich people. A thread I wrote over a month ago got a lot of responses and it really woke me up to what I should be making. I threw out the window the old idea of charging what the competition charges. I thought before I needed to make $40 to $50 an hour and I was doing good. Now I realize I need to make a minimum of $84 an hour. I started reading up heavily on the finances of small business and have learned so much over the past month. I have stopped worrying about what the competition charges and now only worry about what I charge and what it will take for me to keep my business over the long haul. If I can't make at least an average of $84 an hour at the end of the year I will then consider whether or not to come back next year. A good part I read in a book talked about charging what your competition charges just to find out your competition is going out of business and so are you by following his prices. Only you know what it takes to make your business have a profit every year. Everyone can't charge the same. I will never look at other small businesses the same again. Now I know why they charge what they do. It woke me up to helping support other small businesses in my area by buying locally. The only time I don't buy locally is if they are charging 5 times the price I could buy something for online. I like something I read and it says to sell your service not your price.
I believe both of you are dead-on-target. That is way cool information and definately fits into my experiences. I think others who are tuned into competition and are highly sensitive to their pricing will and should relate to what you have said. Anywho, thanks for the positive feed-back.
I also win bids with higher prices. I have a cold water machine 4gpm 3000 psi and get calls to wash anything from a ranch house to 3 story commercial buildings and even a fleet of 24 RV's. I use cold water more chems than the hot water guys and charge more and still get the work. Quality and salesmanship will get you far. Hot water is in the works for this year. If your sales technique, appearance and quality is all good then people will choose your company over another inspite of price unless you are way off. One point, I am V.P. of a masonry company and we put in a bid on a town house foundation and footers. near 60,000.00, we were 10,000.00 higher than than the next guy on the list, we were the high bid by a long shot. After reviewing the bids, the contractors asked why we were so high we explained all the aspects of the bid. Turns out the lower guys had missed alotof small details that added up in the end. Our reputation and experience along with extreme attention to detail won this bid. I run my pressure washing business the same way. I don't leave a job until its done as if it were my own and I charge accordingly. I agree with the above post I usually charge 55.00 - 60.00 dollars an hr + business costs (all costs in one year averaged into a daily figure per working day).
When I call back on a bid and the customer states that we want your services but your bid is higher than the rest.
I simply ask:
Are they insured? for example - if someone is shooting water at high pressure at your home (your biggest investment) - do you want someone who is protected.
Are they using quality chemicals that will not damage your property?
Are they providing you with a written contract for your protection?
If yes - hire them. If no - hire me.
You get what you pay for.
I provide each bid with a Estimate, Contract, & Restoration Steps ( for example for a deck - I have develop a 4-Step Deck Restoration Step Process). My logo is on everything.
I have them for house wash, decks/fence, log homes, roofs, etc.
**When the next guy is writting the estimate down on the back of a business card or on scrap piece of paper - It makes a difference.
Stick to your prices within reason - You can not make money at home, why work to not make money?