DISCOUNTING YOUR PRICE IS TABOO – plain and simple.
Many cleaning businesses have a habit of advertising “discount specials” or negotiating lower prices when their prices are challenged by potential clients. If you have viewed and studied my program or spoken to me about this subject, you know my thoughts on this topic as it applies to this industry. DISCOUNTING YOUR PRICE IS TABOO – plain and simple.
Generally speaking, consumers don’t buy price; they are SOLD price. Wal-Mart SELLS price. Car dealers SELL price. Your Sunday paper contains oodles of sales flyers. The problem is that if that is the message being sold, price is what consumers will be shopping for on products or services they want. And if that is what you are selling, you aren’t going to make a decent profit in this business.
Oh yes, low prices and “special offers” will attract more potential clients. But if you could sell your service for one dollar, how many clients could you get if nobody knew about your business? ZERO, ZILCH, NONE.
You have to charge enough to be able to advertise your service. You need to charge enough to be able to attract and retain great employees. You have to charge enough to pay your overhead expenses. And unless you are in business to be philanthropic, you have to charge enough to earn a fair return on your time and investment. If you promote low prices, you WILL NOT accomplish the above.
You will never see a residential cleaning service that promotes price doing over $1 million in annual sales. Successful operators, both franchised and independent, have much more to sell than price. Remember that in a service business it is almost impossible to compare apples to apples. It’s not like selling physical products where you can get a model number of a refrigerator, as an example, and compare prices between various vendors.
With our POM=CP pricing formula, you’re kept on track because when reasonable numbers are used in the formula, any price lower than that should be non-negotiable; PERIOD. You’re not in this to trade dollars. Almost without fail, when new clients of mine understand and apply POM=CP they are shocked at its simplicity, fairness and virtually guaranteed profitability on every cleaning client.
Whether you use POM=CP or any other formula for pricing your work, stick to it without fail. If you are a first class operator – or want to become one, you have so much more to sell your clients on why they will be completely satisfied with the value experience they’ll enjoy with you.
With 18 years in the cleaning industry and 45 years of experience building his own businesses, Gary Goranson was one of the first business consultants to serve the residential cleaning industry with real experience and solid credentials. Visit him at HouseCleaningBiz101.com.