I remember the time I had a large Kitchen Studio selling kitchens from probably one of the most expensive kitchen suppliers at that time. Often after providing a quote, I would get the reaction “That’s far too expensive”
Sometimes it was difficult to to get through to customers why the price was justified.
My business is now consulting in the Local Marketing niche focusing on helping Home Services Companies, Kitchen & Bathroom Suppliers, Windows & Doors and Garden Buildings businesses etc who want to generate leads and grow their businesses.
I came across a really good post on Facebook from Justin Cappon which I thought was one of the best ways to explain how to deal with the people that think your service is too expensive.
Perceived value is a fascinating topic.
Justin couldn’t have explained it better and has kindly allowed me to use his conversation on my blog
“A customer asked a contractor friend of mine how much it would cost to do this project.
My friend gave him a proposal: $4500
My friend asked: What do you think is a reasonable price for this job?
The customer answered: $2500 maximum
My friend responded: Ok, then I invite you to do it yourself.
The customer answered: I don’t know how to.
My friend responded: Alright, then how about for $2500 I’ll teach you how to. So besides saving you $2000, you’ll learn valuable skills that will benefit you in the future.
The customer answered: Sounds good! Let’s do it!
My friend responded: Great! To get started, you are going to need some tools. You will need a chop saw, table saw, cordless drill, bit set, router, skill saw, jig saw, tool belt, hammer, etc.
The customer answered: But I don’t have any of those tools and I can’t justify buying all of these for one job.
My friend responded: Ok. Well then for an additional $300 I can rent my tools to you to use for this project.
The customer answered: Okay. That’s fair.
My friend responded: Great! We will start the project on Monday.
The customer answered: I work Monday through Friday. I’m only available on the weekends.
My friend responded: If you want to learn from me then you will need to work when I work.
This project will take 3 days so you will need to take 3 days off work.
The customer answered: That means I’m going to have to sacrifice my pay for 3 days or use my vacation time!
My friend responded: That’s true. Remember, when you do a job yourself you need to account for unproductive factors.
The customer answered: What do you mean by that?
My friend responded: Doing a job completely from start to finish includes time spent to plan the project, pick up materials, travel time, gas, set up time, clean up, and waste disposal amongst other things. That’s all in addition to the actual project itself. And speaking of materials, that’s where we will start on Monday so I need you to meet me at the lumberyard at 6:00am
The customer answered: At 6am?!! My work day doesn’t usually start until 8am!My friend responded: Well then you’re in luck! My plan is to start on the deck build by 8am. But to do so we have to start at 6am to get materials picked up, loaded and delivered to your job site.
The customer answered: You know, I’m realizing that a lot more goes in to a job than what a customer sees in the finished project. Your proposal of $4500 is very reasonable. I would like you to handle the project.
When you pay for a job, especially a custom job, (whether it’s a physical project or digital project) you pay not only for the material and the work to be completed. You also pay for:
Time to plan
Time to prepare
If you request a proposal for custom work to be done, please don’t disrespect a service provider by trying to get them to lower their prices.
If their proposal exceeds your budget, there’s nothing wrong with getting other proposals.
Just remember.. you get what you pay for.
SERVICE PROVIDERS: Know your worth and be confident in it.
CONSUMERS: Recognize their worth and be respectful of it.”
There is a strong message here for Consumers and Service Providers
I hope all my clients and potential clients learn a lot from this and appreciate the value provided by Justin