Price high or price low

ive been in the business since 2003 and have a great clientele for my set price. i offer discounts to get people to call but know how to price to make money. i actually tripled my business this past season. i dont believe in going up on my faithful customers that get their windows cleaned at once a year. after a lot of thought and after making up my mind to actually increase my pricing for new customers ive been second guessing myself… ive probably been over thinking this bc well, its the off season and what else is there to do other than over think and second guess every decision on the upcoming season but here is my dilemma;

i have 2 major companies moving into my area (the kind that actually use soap to clean windows) one of them prices for control of the market by pricing super low and then puts their prices up 15% every year after. the other prices all over the place, no set price, but i have a feeling they are going to do the same thing… try to gain control of the market.

what do you think i should do? increase my prices and emphasize quality, service and what a great ass i have, keep prices middle of the road and keep growing bc of my wonderful smile or decrease prices and put a gun in my mouth bc im not making a profit but have control of the market.

any ideas?

Without first- or second-hand knowledge of your ass or smile, you’ll need to join us in Reno for a consensus to occur (those two items seem to be a condition.) :smiley:

i wish i was going to reno, just couldnt talk the girl into letting me go… something about gambling, having a 9 month old at home and how pat west and i would definitely find trouble together in reno… something like that i wasnt really paying attention :slight_smile:
i will be at the wcr/mwcoa event

What the other companies do is outside of your control, so no use stressing yourself over it. Just do what you do, and your customers will continue to pass you on to others, as it sounds like they have been doing already.

I’ve upped my prices a handful of times over the years, and was also really stressed about it the first time around. I decided beforehand that I wouldn’t raise or lower prices based on what others were doing, because as you said, they can be all over the map, but instead decided to raise them according to what my needs were based on inflation of gas and supplies and such.

Explaining to my customers that I was making less money because of (fill in the blanks), and so needed to “give ya a little bump” was received far better tan I had ever anticipated. Didn’t lose a single one, any of the times, over the years. The most I ever heard was, “How big a bump?”

Since each has been only 5-10%, as required for the particular situation of the time, every one said, “Oh. That’s fine by me. That’s not a big raise.”

To one customer that’s beans, but add it up and it’s a lot to you in the course of the year.

I guess I’ve had to do this on average, about every other year.

Think of it like this. If you double your price and loose half your customers you make the same amount of money with less work. To many times we think prices with our minds. Bad mistake. There are plenty of customers who will pay more than we charge to have clean windows. What you may think is a high price to them may not be. Don’t think with your wallet. There will always be another company working for less. Do not worry about the low ballers.

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Well shaking it may help. JK. You said your business increased 3 times the amount so I don’t think you need to worry. If you decide to up your prices a little I would start it on your new customers instead of existing. It doesn’t have to even be on the windows but maybe your addon services like and extra dollar on screens or on lights, etc. Either way shouldn’t go wrong for you.

Great advice from everyone on this topic. We werent sure if we should raise our prices last summer but we went ahead with it. If we started losing too many jobs we could just bring em back down. But the truth is we lost fewer jobs and often people said “thats a great deal!” At the same time we added new terminology to our advertising. Such as “premium service,meticulous window cleaning, 100% satisfaction or you wont pay, the trusted window cleaners”. We got new uniforms and new signs on the van. People pay for quality, its the same for anything.

I say we should all strive for getting people to pay us as much money as possible to clean their windows

Its your business, charge whatever you want.

im not looking to lose customers but gain more of the market at a higher price… so i feel like we can do a better job, we’re not rushing through to get to the next job to make up for low prices.

im not worried about make shift companies low balling my prices… but its the bigger companies who come in and ruin the market for a smaller company like mine to gain control of the market and then they put their price up. in order to keep that from happening whenever someone mentions these 2 companies i always match their price (with an invoice or estimate as proof of course) and they go with me bc im a local guy while these other companies are over an hour away.

“Wal-Mart” pricing (price matching) seems a slippery slope, dragging everyone else’s price down to a median low. Are you going to raise yours by 15% a year to keep up?

Personally, I’d stick with the other strategy you mentioned, showin’ folks that their are other advantages to using you over them, like location, as you already mentioned, better quality, and a more personal service experience for them as opposed to a “big” company.

Most folks are more than willing to support a local business over something perceived as more of a “corporate” design, IMO.

I would worry about the pricing of the others. If they are extremely low it can and will effect your business. Ask Sears, kmart and all those large chains how they felt the wrath of wal-mart. Companies that low ball work on volume and profit from it. There is a saying in smart business “I would rather have a small part of something large then a large part of something small.” If those companies suck up most of your market, it wont matter if you have high paying customers. Even more so if they do a decent job. If they do a decent job they will suck away your high paying customers also. It’s only a matter of time before one of those customers or most of those customers shop around. If those customers are bunched together inside a neighborhood the word of mouth can kill you.

With that said, being you increased business 3 fold last year, I would not worry too much until they actually move into town. You’re doing something right if you increased sales like that. Even more so in a recession. Plan plan plan for their move in. Market before they get in, market hard. Try to get another 3 fold increase before they get here. Once you have the foot in the door people are more likely to retain your services even if the others are cheaper. But it matters how much cheaper. If their under your price 20% you are going to have to adjust or work very hard to keep your current clients. I would not raise. Not now anyway. I would wait it out one more year to see how things go after they move in.

i only match the price of those 2 companies… i dont match prices with bucket bobs, firefighters or companies i am friends with. i do this bc i believe if these 2 companies lose enough work in the area they will be discouraged. in the end if i have 15-20 even 50 of those clients its money in my pocket not theirs. i would rather make a little profit than nothing at all and give these companies less of a reason to come into my area…

i agree with you… you have given me a lot to think about.
hope your hand is feeling better

Thanks I’m really surpised as it does not hurt anymore. Again not much they can do in the lines of fixing it now, but heck as long as it don’t hurt and I can use it I’m a happy guy. You can see a big difference between the two hands and how the fingers sit but who cares lol. It works and there is no pain. I’m sure in 20 years I’ll be screaming from it unless by then they can just stick it in a box and out comes a brand new one. :slight_smile:

or you get a mechanical one like luke skywalker :slight_smile:

That would be AWESOME lol. I would have it modified for WCing attachments, then sell myself to the highest bidder for modeling gigs to sell their products lol. Of course with Lucas Arts permission :smiley:

My analogy went awry! lol

The business strategy is a sound one, financially. What I was tryin’ to convey was that Cookie Monster isn’t on the level with those other companies, size-wise, but can offer something that’s not generic to the customer, like better customer service for example.

I don’t know about you, but I’ve found that getting decent customer service from bigger companies can be spotty at best, many times, whereas he’s gonna be right their for his folks.

Love that small part/large part quote, btw. Gonna remember that one.

And your last line is very relevant right now. Raising prices right now, in most markets would be akin to committing business suicide.

I strongly recommend that you raise your prices gradually over time. 2-3% a year is what I have done in recent years. People dont blink an eye at 3%. I dont anyway. If you dont- you will screw yourself in the end. I didnt raise prices form 1996 to 2004 and I eventually had to face the music and sticker shock my customers. Had a few gripes here and there but NO ONE dropped me. Some jobs went from $150.00 to $250.00- Thats how far behind I got.

The truth is that most of them were worried that I wasnt making it and thought I would eventually go under. Thats how far behind I got.

I raise my rates on everyone at least 2-3% a year. I dont send out notices or tell them or mention it on the phone that my rates have went up. Just show up, do the work, hand them an invoice and I get paid.

You are leaving money on the table. I wish I had all the money I should have charged during that 6 year period. It makes me pi$$ed just thinking about it.


Unless I am way off mark the average rate of inflation is 4% per year. So we should increase that rate every year.

I too wouldnt’t mention the increase. Just procede like normal.

If I were you I would “dote” over my customers more. Customers often more than clean windows want to have a relationship with you. Big companies will fail at this.

Utilize to stay in constant communication with your customers & knit their hearts to you.

Quality is a good way to go.

Quality is very important to the customer.

My contention is however that even though our quality may surpass that of others if my “people” skills stink I risk losing customers to companies that, although their quality may be questionable, know how to market consistently to their customers.

Quality is VERY important but it is NOT everything we can do to keep every customer. To shelter our customers from the big dogs we must build a pleasant relationship with our customers by consistently marketing to them.

For example - Send them a card in the spring reminding them that you exist and that they need to have their windows cleaned. Call them a few days after they’ve received it and schedule them in. Send a thank-you card after the job has been completed thanking them for the work and telling them what a great customer they are. Send subsequent cards on maybe July 4th, Thanksgiving, New Year, on their birthday. Whatever it takes to keep you in front of them.

Consider looking into it. You can get an entrepenour account for $399.00 which gets you the best price per card at $1.37 for a 2 fold glossy card with a customized picture or $.90 for a post card.
It’s a nice way to connect and stay connected to customers for a little expense. It can be automated too.

Then, when the big dog shows up in their mail box with a flyer, although they may be cheaper, unless the customer is a “cheap” skate, because they are knit to you they won’t give the other company a 2nd thought.