The first words out of your customer’s mouth are, “What are your rates?” Before asking about anything else the focus is on price. Once you follow your customer down that path you are done for. You are on a set track with no deviation to reducing your price to compete with all the other guys out there who are competing on price as well.

Often the customer only has price to guide her. When dealing with a business that she does not have a solid understanding of she really has no other guideline to go by. She won’t normally accept the highest bid or the lowest bid. In her mind the highest bid means she is probably getting ripped off and the lowest bid means she will be getting the worst product. Those are her only guides to quality.

When your competition is bidding you down to get the work instead of you what are they doing? Often they are either selling themselves too cheaply and will end up resenting the customer and do a poor job for little or no profit or after they get the bid they will indeed rip off the customer padding hours or misrepresenting costs. The former does a job that may have to be redone at greater cost and the latter leaves the customer feeling fleeced and taken advantage of.

The key is to sidestep the question. “Well ma’am, what I find is that talking about price before I understand the work that needs to be done can lead to misunderstandings. Tell me about your project first then I will show you photos of previous jobs, testimonials about my work and my guarantee. Then we can discuss the price.”

You want to frame the discussion on the benefits she will receive not price. You do not want her to equate your work with that of the guy down the street who desperately wants the job at any price and will work for peanuts. When your customers understand your commitment to quality and your commitment to customer satisfaction they will realize that in the long run they may very well be paying less for better quality work.

It can be difficult to get this across to your potential customer. Be prepared with examples, testimonials, referrals and references. Make sure that your references will say good things about you before you send a potential customer to them. Using such social proof is key to getting buy-in from your prospects. When they know in their hearts that you will take care of them and even cherish them price drops out of the equation and you can charge what the traffic will bear.

We’ve been taught that price is an indicator of quality. In fact people often use it as a decision-making crutch instead of an indicator. It is up to you to show your customers that their satisfaction is more important than cost.

Larry Earnhart
Alchemy Business Consulting
August 26, 2014