How to find the average price within your market

[NJ104]

I have been taking classes and reading books and the one thing that I keep on hearing is the amount that people charge and then the afterword which is usually "but find out what your prices are for your market " In other words is there a specific price in a specific area like does it cost more for a client in California than it would if that person lived Washington DC versus Florida and if so How the @#@@ do you find out besides calling your competitor and asking how much a room would cost. I usually charge on average 24 cents for commercial and 35-40 cents for residential I want to know because I want to know if I am short changing myself or could I raise my prices.

 

[Wayne Miller]

The only way I know is to raise your price and see what happens. That's what we did. 85% over a couple years or so. Hardly anyone made a peep.

Something else that helped was to stop focusing on what we charge PSF and look at the job in terms of what's it worth. What's it worth to have a trained, insured, qualified professional come to your home, clean your entire house full of carpet and quarantee your delight? Customers accustomed to paying for services don't always think as cheap as BDCC's.

And, maybe the last thing was get past the feeling that $400 or $500 is a lot of money for carpet cleaning....

 

[Brian R]

Yeah, I just paid $500.00 bucks today for some work on Jen's car. It hurts but I didn't think I was getting screwed.

It probably took them about as much time as it takes my Techs to earn $500.00

There was a new battery involved in that total along with the 30,000 mile service. So you get the idea.


If you raise your prices and you lose "some" customers....you will still make more money over all.

Don't put out a big announcment....just do it and see what happens.
If your regulars complain, it's up to you to figure out if what they want to pay is worth your service.

 

[Jim Williams]

That is a tough question to answer. In all areas prices can range from $20 a room to .50 a sq. ft. It has alot to do with your customers feeling like they got their moneys worth when you walk out the door. If you are a .50 a ft. guy then you better be putting on the show while you are there.

I feel like I am priced too low for the quality I provide. I am at roughly $50 per room, but with the price of everything these days it just doesn't go that far. I mean you go buy two bags of groceries and you spend half a days pay, or have your van worked on and you easily spend $600-$1200.

Take Waynes advice and test the waters. If you don't get any takers on your new prices you can always go back down. Do what you have to do to feed your family. It chaps my ass when the rich people living in million dollar homes don't want to pay me enough to make a good living.

Heck, I think tomorrow I'm raising my prices!

 

[Ron Werner]

Do some calling around, ghosting. Find out what the cleaners in your area are charging and what they do for that.
I had a "friend" hire me to clean his house. He said I was the best. I handed him the bill and he said he could have gotten it cleaned for $100 less by another company. Ticked me off. I was motivated to phone around, used his house specs. I said " I have a house needs cleaning (so I wasn't lying, I did have that house to clean !gotcha! ), 7 rooms, hall, 15 stairs, about 1200sf." And I asked what their procedure/method was. I was going to charge $336 (1998), I got one company at $360, one around $300, one about $250, a few around $150, and several around $100 and even some less than $100. Oddly enough I bet I would still get those estimates today, 12 years later.


Determine what you need to make in order to make a profit and how much you need for the amount of profit you need to make it worth your time. ie what are your costs.

I was told that you should have your price to the point where a few people will tell you its too high, many will hire you, and some will say "Is that all?"

 

[Dolly Llama]

worth repeating;


"
Determine what you need to make in order to make a profit and how much you need for the amount of profit you need to make it worth your time.."

I usually charge on average 24 cents for commercial and 35-40 cents for residential

lemmie ask, are you slow, steady, busy or balls to the wall busy at hose prices?

..L.T.A.

 

[Brian R]

. It chaps my ass when the rich people living in million dollar homes don't want to pay me enough to make a good living.

Heck, I think tomorrow I'm raising my prices!

How do you think they got rich? By getting as much as they can for as little as possible.
For the most part, that's why "high end" homes worry me.
There was a time few years ago where Middle Class people were in those high end homes and they paid whatever it took. Good people, but not so good with their money....that's why they lost their home a few years later. Bad money management.

Ok, that sounded like I was for the priceshopper. NO....I'm just sayin. lol

 

[Wayne Miller]

Are "high-end" homes really that different? Or, is it your attitude when you walk in the door?

I have run into a few bargin-minded "high-end" homeowners. The majority are not. Most simply want what they want and will pay a realistic price.

I do find, though, a tie helps...... lol

 

[Brian R]

Image is everything Wayne. shiteatinggrin

Attitude over aptitude

At the end of the day, all you have is how you treat other people...and those other people will know it.

OK, threw that last one in there for the hell of it. lol

 

[Ron Werner]

Ellen Rohr puts out and ebook called "How Much Should I Charge?". A companion ebook is "Where Did the Money Go?" Well worth the read, barebonesbiz.com

 

[TimP]

Yeah, I just paid $500.00 bucks today for some work on Jen's car. It hurts but I didn't think I was getting screwed.

It probably took them about as much time as it takes my Techs to earn $500.00

There was a new battery involved in that total along with the 30,000 mile service. So you get the idea.

All I can say is Damn. A battery and 30,000 mile service??? What the hell did they do in that there is nothing major needing to be done unless you had wear items needing replacement or problems with your suspension.

I had my 105,000 mile service done a few months back for my 2003 accord. All I've done till then was change the oil myself. The service charge for the dealer was like 480 bucks I think, it was less than 500. That included changing all fluids, coolant, oil, power steering, transmission, brake fluid. New spark plugs which are 20 a pop, new air filters inside etc. Complete tune up, no timing belt was needed as it has a chain. That is probably high being it was a dealer. I couldn't imagine paying that for 30,000 miles, being as it should only be an oil change and a quick inspection. Maybe a transmission fluid change if it was an automatic but that's even a stretch, unless it's some german money pit. I think VW asks 3-400 for a transmission fluid change on their new dual clutch transmissions, and one reason I wont buy one either.

 

[Brian R]

New battery
Head light attatchment
oil change
balance and rotate
new plugs
new coolant
trany service
lubricate Chassis
general check of safety equipment
Inspect drive belts
Inspect steering linkage
Inspect suspension
Charging system check
Checked some other linkage and crap I'm not going to write out.

Crap I don't want to do myself...I have company to run and an internet board to support. jeese.

Oh, rental car too.

 

[TimP]

Why do you need plugs at 30,000 miles?

The list isn't too bad for what you had done price wise for a dealer. But that's probably excessive in what was done for maintenance at 30,000. Oil, and transmission for an automatic is all that should be done. Inspection of course should be done too. But I wouldn't say you got completely ripped off especially with a rental car. !gotcha!

 

[rotovacguy]

Yeah, I just paid $500.00 bucks today for some work on Jen's car. It hurts but I didn't think I was getting screwed.

It probably took them about as much time as it takes my Techs to earn $500.00

There was a new battery involved in that total along with the 30,000 mile service. So you get the idea.

All I can say is Damn. A battery and 30,000 mile service??? What the hell did they do in that there is nothing major needing to be done unless you had wear items needing replacement or problems with your suspension.

I had my 105,000 mile service done a few months back for my 2003 accord. All I've done till then was change the oil myself. The service charge for the dealer was like 480 bucks I think, it was less than 500. That included changing all fluids, coolant, oil, power steering, transmission, brake fluid. New spark plugs which are 20 a pop, new air filters inside etc. Complete tune up, no timing belt was needed as it has a chain. That is probably high being it was a dealer. I couldn't imagine paying that for 30,000 miles, being as it should only be an oil change and a quick inspection. Maybe a transmission fluid change if it was an automatic but that's even a stretch, unless it's some german money pit. I think VW asks 3-400 for a transmission fluid change on their new dual clutch transmissions, and one reason I wont buy one either.

Dang Tim, $20 a pop? Those things made of solid gold? shiteatinggrin

I put Autolite Platinum plugs in my Explorer 2 years ago, and I cringed at spending $8 each for them. I do ALL the maintenance on my vehicles simply because of past experiences with dishonest mechanics. The only thing I could not do to it was the tranny fluid. My Explorer has a "sealed" 5 speed Getrag transmission. You need a special pump to fill it back up, as there is no fill tube. So I had no choice in having the dealer do that. I wanted to put in the synthetic Mobil tranny fluid, but they wanted over $400 for that. Heck, even for the stock factory recommended stuff it was $230.

I mean you go buy two bags of groceries and you spend half a days pay, or have your van worked on and you easily spend $600-$1200.

Are you serious, Jim? You're going to compare what you spend on food, which is a necessity for life, or what you put into your vehicle, which requires a much greater level of skill and education, and has a much higher degree of liability, to carpet cleaning?? I've heard many stories of mechanics forgetting to put brake fluid back in after they bleed the brakes, or forgetting to tighten the lugs when they pull off the wheels. Either scenario could result in injury or worse to innocent people, with a huge ass lawsuit to follow for sure. What's the worse a carpet cleaner will do? Damage a fine rug? Discolor a fabric? Big deal. As long as the cleaner has insurance it's not a problem. If he doesn't have insurance? Well, that's his problem for being a dumb ass then.


Don't get me wrong, I agree with you that money doesn't go too far these days, no argument there. But at the end of the day, a carpet cleaner is doing just that, cleaning. Whether it be carpet, a rug, upholstery, whatever. The bottom line is it is NOT a necessity for a family to outsource. Many will do it themselves to save money, even if the quality may not be as high. Try getting by these days without food, or a functioning automobile. It's no different when I'm doing HVAC work. People are willing to pay what we ask because having a working furnace / burner IS A NECESSITY up in these parts during the winter months, NOT AN OPTION. And when it's 90+ degrees outside with high humidity, not too many people want to go without working air conditioning. And I can sure as heck guarantee you there is WAY more to know in HVAC then there is in being a carpet cleaner. There is a reason the average Joe can go to Wal-Fart or Home Cheapo and rent a rug doctor, or purchase a cheap ass Bissell steam vac. And that very Joe can get his hands on the same chems and tools that you and I use from the distys. Try getting some refrigerant from an HVAC distributor without your EPA certification, or the tools necessary to handle it, good luck.


With that being said, if you guys can get $400-500 for sucking dirt from a fabric, good for you. I can tell you that in the area I live in, you'd starve real quick, regardless if you put on some gay ass tie or not.

 

[TimP]

Honda plugs are iridium. They retail for 20 each. If u put platinums in it will run like crap. I know honda and toyota use iridium plugs. They last over 100 thousand miles. Honda engines out last the vehicle cause the parts are premium.

 

[Steve Toburen]

I was told that you should have your price to the point where a few people will tell you its too high, many will hire you, and some will say "Is that all?"

Yep, in my unscientific way I called it my POP ("Point Of Pain") Pricing system. I wanted a substantial minority of my customers to say, "Wow! That is pricey! But my neighbor says you are worth it so when can you do it?"

Steve
www.SFS.JonDon.com

PS You really ought to be more precise than this and actually KNOW how much it costs you to do the job. Many carpet cleaners don't have a clue ...

 

[renegade_cowboy]

Its all about supply and demand.

Create a good image, a good concept with tons of value and raise your prices.

 

[Steve Toburen]

... and raise your prices.

We routinely do follow-up surveys of our SFS attendees on what the single most valuable thing they took away AND implemented from the Strategies for Success seminar. Far and away the biggest response is, "Raised my prices."

Steve
www.SFS.JonDon.com

PS Now I've saved you five days out of your life and 695.00.

 

[renegade_cowboy]

Its all about self confidence in your business and what you do. I take good care of my clients and they use me for me, not for what i charge and thats the key.

Project that confidence, trust and so on and they will come and tell all their family and friends.

Pat @ Jon Don in North Seattle has been hugh in helping me grow.

 

[Brian R]

The problem is self worth. Do you think you're worth the price you get? Most guys are embarrassed to have a higher price because they don't want to deal with the drama of a customer that won't pay it. Doesn't happen that often ....but it should.

Convince yourself before you go into a house that you are better than what you think the home owner thinks you are. :shock:

That's the first step

Second
Be ready no matter what and even expect the home owner to throw a little bit of a fit about your price when you give it.

Third
Convince yourself that it's your own view of yourself that matters and not anyone else's. You are better than the prices you are getting.

Are you in this business to squeak by and pay the bills or do you want something left over?

This has been a moment with Brian. !gotcha!

 

[Lee Stockwell]

The "average price" within your market would be nearly impossible to determine accurately, and even if you DID it would only be an answer to a trivia question, NOT the way you should set your prices.

 

[Steve Toburen]

The "average price" within your market would be nearly impossible to determine accurately, and even if you DID it would only be an answer to a trivia question, NOT the way you should set your prices.

Yeah, Lee, I always ask students "So, are you impressed with most of your competitors?" The replies invariably follow this model, "Are you kidding? What a bunch of &*%$*#@% losers!" So then I ask just one question: "OK, then why are allowing these 'losers' to set your pricing and determine your business model for you?"

Steve
www.SFS.JonDon.com

PS I agree with you, Brian, re: "self worth". I don't want to come across like a Tony Robbins self-help tape but our industry suffers as a whole from a severe lack of self-esteem. Or as I used to inelegantly tell my technicians, "Never let 'em see you sweat!"