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A Game of Margins...

February 1 2006 at 9:26 PM
Rambo 

A early post about the price of cleaning chairs made me think that Business is a Game of Margins. It is not a game of volume. Any fool can cut price,and get volume, and go broke. YOUR COMPETITION DOES NOT CUT YOUR PRICE, YOU DO. Your customer will always tell you they buy on price, even if it is not the case, because they are trying to get you to cut your price. I just sold a chair cleaning job, at a local church,680 chairs, seat and back only @$4.00 they previously were paying $2.50. I sold them on, quality, service, experience, not price. Remember there is a certain amount of gamemenship to selling your service. Remember to present it in a meaningful, useful sense to your customer, and don't blink when you give them the price. I know that many chairs are volume, but my margins of profit just doesn't work at $2.50. I am going to share a bid story of a friend who was trying to land a commercial office building for carpet cleaning. He was sittng at the desk of the Operations Mgr. and noticed a bid from his local competitor laying on his desk. It was driving him nuts for about 5 minutes as there was a can of Coke sitting right over the contract total price. Then the phone rang and it was the Oper. Mgrs. boss who wanted to see him in his office immediately. He told my friend, this will only take a minute or two,seems we have a little problem, just make yourself comfortable, and shot out of the room. My friend, of course, couldn't help but sieze this opportunity to lift the Coke to see the dollar figure on the quote. And all of a sudden a thousand BBs bounced all over the office from out of the bottom of the Coke can where they had been hidden. There are two morales to this story. First, never pick up anything off your prospect or customer's desk--always slide it sideways to see what's underneath (just kidding) Second, remember that you are the one who cuts your price, and your prospect has every right to try to get you to do so. But again, it is you who will actually do the price cutting, not your competitor. It's always a self-inflicted wound, isn't it? Answer; No, he did not get the bid.

 
 
AuthorReply
Aaron Baum

Great Post!

February 2 2006, 4:55 AM 

Rambo,

Another GREAT post as usual. I know for one that I always tend to lower my price once in a while, especially in slow winter times like now, when the business is slow. That post opened my eyes though, and I appreciated it!

Thank You!
Aaron Baum
Brownell's E-Z Clean, LLC

 
 

Rick Gelinas

Re: Great Post!

February 3 2006, 8:12 AM 

Ray is a wise feller when it comes to business.
Thanks for sharing Ray





Rick Gelinas
encapman

 
 
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