[JNLP]

I often see others companies ads state they will beat any estimate or any written estimate (yeah... I've been reading craigslist again). It gets me wondering how that is possible if you're a legitimate company?

If I give a price, it's the price it will cost me to do the job. To match somebody elses price, that would mean either:
a) I don't have a real company that has real bills.
b) I'm going to cut every corner possible to make it happen.
c) I don't know what I charge & just make numbers up in my head, so some is better than none. Beer money baby!

So IF approched with this from a customer who wants a counter match / bid war, how do you professionally make them see your point of view without sounding like you're simply down talking your competition so you get the job?

 

[Wing 54]

Interesting that this should come up again. Business from profit.

 

[RCP]

I think it goes back to some of the points being discussed in the "Customer Perspective" thread. When a customer wants to compare bids it is a great time to educate them on prep, scope and materials (oh, this one does not include priming and is using ____ paint.) Not to mention license, insurance, warranty, reliability etc.

 

[Wing 54]

In other words selling your experience, yourself, and your company. Not being the cheapest.

 

[Dave Mac]

I know a guy who sells that way,and usuallythe highest bidder, in order for him to match the low price certain qualifications have to met, such as both party's have to belong to pdca, and or Napp, he has a long list of qualifications, apples to apples, he says no one has ever challenged him, seems more of scam to me then anything else

 

[RCP]

In other words selling your experience, yourself, and your company. Not being the cheapest.

Exactly! What a concept:thumbsup:

 

[Brian]

I know a guy who sells that way,and usuallythe highest bidder, in order for him to match the low price certain qualifications have to met, such as both party's have to belong to pdca, and or Napp, he has a long list of qualifications, apples to apples, he says no one has ever challenged him, seems more of scam to me then anything else

Dave,

Why does that seem like a scam? To me, a scam is intentionally misleading and fraudulent.

Brian Phillips

 

[Dave Mac]

Dave,

Why does that seem like a scam? To me, a scam is intentionally misleading and fraudulent.

Brian Phillips

Just because I think the person doing it, knows good and well that all the list of qualifications probally wont be met, so the low price guarantee, comes with a lot of fine small print. I think it works well for him, and Im really not the right person to judge, but i hate small print. Its either a low price guarantee or its not in my book. And his price is always higher then most, so I think it is a little mis leading

 

[MAK-Deco]

if you quote a job for 2k and someone with the same specs as you (apples to apples) quotes it for 1700 and you match it, what you are saying the client is that I can do it for 1700 but I was going to charge 300 more because I can... If you bid a number it should be done on your production rates etc... maybe the other guy is just cheaper not necessarily a low baller..

 

[Brian]

Just because I think the person doing it, knows good and well that all the list of qualifications probally wont be met, so the low price guarantee, comes with a lot of fine small print. I think it works well for him, and Im really not the right person to judge, but i hate small print. Its either a low price guarantee or its not in my book. And his price is always higher then most, so I think it is a little mis leading

Thanks Dave,

I ask because that is exactly what I do, except I don't have a lot of small print. I have a low price guarantee. I will meet or beat any price from a qualified contractor, or give the customer $100. A qualified contractor must be a member of a trade organization (I don't specify any particular group), must submit a written estimate with the same materials and scope of work, and must be insured. That's it.

I don't expect many to be able to meet these criteria, even though they aren't outrageous at all. The ones who can meet the criteria are priced very comparably to me. My reason for offering this is to get the customer to focus on issues other than price. It works.

My price is usually the highest, but I do not get asked to lower my price. I am simply helping the customer understand what value is being offered, and that there is a price for that value. If that's a scam, then I will proudly proclaim myself a scammer. But I don't think it is a scam. I think it is an honest way of doing business-- sell value and communicate that to the customer.

Brian Phillips

 

[Dave Mac]

Thanks Dave,

I ask because that is exactly what I do, except I don't have a lot of small print. I have a low price guarantee. I will meet or beat any price from a qualified contractor, or give the customer $100. A qualified contractor must be a member of a trade organization (I don't specify any particular group), must submit a written estimate with the same materials and scope of work, and must be insured. That's it.

I don't expect many to be able to meet these criteria, even though they aren't outrageous at all. The ones who can meet the criteria are priced very comparably to me. My reason for offering this is to get the customer to focus on issues other than price. It works.

My price is usually the highest, but I do not get asked to lower my price. I am simply helping the customer understand what value is being offered, and that there is a price for that value. If that's a scam, then I will proudly proclaim myself a scammer. But I don't think it is a scam. I think it is an honest way of doing business-- sell value and communicate that to the customer.

Brian Phillips

Brian

I like that appraoch very much, I cant beleive all the estimates clients show me, with no proof of insurance, or no clear scope of work, and want me to match their price, I usually laugh at them, and tell them I would be more worried why the other guy is so low.

Brian how do you present your low price guarantee, is it on a single piece of paper, in your est package??

Funny how all of the sudden, how you explained it I might want to try this. lol:yes:

 

[Brian]

Funny how all of the sudden, how you explained it I might want to try this. lol:yes:

That's why I like you. You listen, ask questions, and think about things. You may not agree, but you at least consider it.

Actually, the low price guarantee only takes up half a sheet of paper. The other half is our on time guarantee. We are on time, or we take $100 off the bill. This applies to me and the crew, no matter how long the job takes. In 5 or so years, we've paid once, because we told the crew the wrong time. Customers love that one.

Brian Phillips

 

[vermontpainter]

Brian

You must have to package and present that carefully to avoid the appearance of selling on price. I am not at all surprised that its been a successful strategy for you. Thats a great way to suggest certain minimum standards, putting it in the hands of the consumer and letting it be driven by them. Great concept.

 

[Brian]

Brian

You must have to package and present that carefully to avoid the appearance of selling on price. I am not at all surprised that its been a successful strategy for you. Thats a great way to suggest certain minimum standards, putting it in the hands of the consumer and letting it be driven by them. Great concept.

I got the idea from Richard Kaller, and it's not hard to package or present.

I can say something like, "We offer a couple of guarantees you might be interested in. We have an on time guarantee... And we also have a low price guarantee. We will meet or beat any price from a qualified contractor. Here are the criteria for what constitutes a qualified contractor."

On the surface, the idea does seem like I'm selling on price. But it doesn't take a customer very long to realize that even though the criteria are very, very low, few contractors can meet them. It really does shift their focus.

Case in point-- This past week I had a customer tell me he's going with a lower price. He's renting the house, so price was more of an issue than if he owned it. But he openly acknowledged that he might regret his decision. He knew we'd do a good job. He wasn't sure about the company he hired. In other words, he had complete trust and confidence in my company, but not the one he hired. As a salesman, that's all I can do. If the customer decides that the price isn't worth it, for whatever reason, I won't lose sleep over it.

Brian Phillips

 

[Dave Mac]

That's why I like you. You listen, ask questions, and think about things. You may not agree, but you at least consider it.

Actually, the low price guarantee only takes up half a sheet of paper. The other half is our on time guarantee. We are on time, or we take $100 off the bill. This applies to me and the crew, no matter how long the job takes. In 5 or so years, we've paid once, because we told the crew the wrong time. Customers love that one.

Brian Phillips

Brian

that right their is some very good and useful stuff, thanks for sharing.:thumbsup:

 

[JNLP]

Thanks for the replies. Didn't look at it that way, and it makes much more sense on how it is possible now. :thumbup:

 

[Brian]

Thanks for the replies. Didn't look at it that way, and it makes much more sense on how it is possible now. :thumbup:

I am pretty sure that most guys offering to beat any price are not approaching it the same way I do. So I think the issues you raised in your original post are legitimate.

The two-bit hacks who compete on price can't offer anything but a low price. A legitimate contractor offers a lot more, but he must still overcome the price issue. Nobody wants to pay more than they need to. But our customers often don't know what they need to spend to get the job what they want and will pay for. That is where sales, i.e., customer education, is so important.

For example, I've been thinking of buying a digital video camera. I know nothing about them. I can read all kinds of articles and reviews on mega-pixels, slew rates, abrasion resistance, and color retention, but it means very little to me. I don't know how that relates to what I want or need. I'm not even sure what I want or need.

At some point, when I have some rudimentary understanding, I will visit a store and seek to get more educated. I will try to understand how all of this applies to me.

The same is true of our customers, or at least, the better ones. They get some basic knowledge, and then try to understand how that applies to them. When they move to the level of greater understanding, that is where we come in. If they are truly seeking the best value, they are a potential customer.

There are a lot of tools we can use in the educational process. Comparing value is one of them.

Brian Phillips

 

[MAK-Deco]

I certainly agree if matching prices is to be done, Brian has a good approach to the situation. Have you ever been in the situation where you gave the 100$ ??

 

[Dave Mac]

I certainly agree if matching prices is to be done, Brian has a good approach to the situation. Have you ever been in the situation where you gave the 100$ ??

In five years he has paid once, pay attention. :001_tongue: lol

 

[Dave Mac]

This applies to me and the crew, no matter how long the job takes. In 5 or so years, we've paid once, because we told the crew the wrong time. Customers love that one.

Brian Phillips

:thumbsup: