TBS083 How To Not Compete On Price

One of Tradies Business Toolkit members posted the following on the private Facebook Group which I am sure many of our listeners can relate to:

Some awesome episodes in that lot to guys, well done! But one in particular stands out for me and that was your interview with Joy from Ozilite. Especially when she talked about price versus value and if your business is sustainable.She made some very good points about what happens when you cut your price to win a job. We as tradies all know people who do this and god forbid we’d be lying if we said we didn’t do it ourselves from time to time. Which has this question of sustainability bugging me so I have a question for you all…And I know this is a touchy subject and requires a lengthy question bear with me…. Most of my Trade business life I have simply conformed to what the “economy” is willing to pay for a particular job and I mean in a broad sense. It is extremely difficult to educate clients of your value ad when most if not all your competition is doing the same…matching there price to consumer expectations. This year to date I have been battling to increase my prices and really drive home the value of what we offer that is different to our competition. I answer the phone within 3 rings, I qualify the client on the phone, I turn up when I say I’m going to with a preceding text to say I’m on my way. I give them a price straight away and email it directly from my iPad. Then after all of that most of them say, “that’s great thank you, now we are just going to get 2 or 3 other quotes”! so ok, I’ve been around long enough to know that maybe there was something I missed in my “sales” process so I ask them… Is there a reason you are wanting more quotes? and what can I do to win your business? which nearly always ends with “we just want to get comparable prices” or something to that effect… To spite all of this I nearly always won the business on the follow up call in the past…until I started to lift my prices this year. Shit I’ve even missed jobs by as little as a couple hundred bux! So what has happened is, I still have to give the same value but I have to reduce my price to keep it all going. That then begs the question, is the business sustainable? If you are in any trade and your desire is to produce quality work then you need good tradespeople in your business; good trades people are not cheap & on average you have to pay around $300 a day each. So if the cost of labour is that and rising but the consumer is spoilt for choice from idiots cutting their price and won’t pay for the value ad, then is a professional trade business that is done properly actually viable? I loved what she said about being jayded by dealing with customers! I’m sure we can all relate…

So today’s episode is our response!