If you have been in business for any length of time, you have certainly had customers try to get you to discount your price. Haggling over price is something that is customary and expected in many cultures cross the world. However, it is typically not a widespread practice in the U.S.; except when it comes to the products offered by people in the service industry (like home inspectors). Because we are providing a service and not a physical product, people are more inclined to try to get a discount, as they are paying for something that they cannot see, touch or feel.
To ensure the future of your business, the best practice is to (typically) not discount your price. I say ‘typically’ because it is good policy to offer a discount for repeat clients and for our military/service people. However, as a rule, I do not offer discounts for my services. They way in which you handle this situation can have a profound influence on your future business success.
An important point to remember is that you do not have to,
and should not attempt to, justify your pricing to a potential client.
I have found that the best practice is to not attempt to justify your prices, as the client really isn’t interested in why you think your price is fair, they are only looking to save some money on their purchase (in this case, the home inspection.) The method that has worked best for me is to explain that I have been in business for “x” number of years, and that my pricing is based on practical experience, as I know exactly what is involved in providing my inspection services. Therefore, my prices are set based on inspection conditions and they do not change; they’re at that price point for a reason.
Some inspectors get caught up in listing all of the reasons why their prices are what they are, and end up debating with their potential client the validity of their pricing structure. When you go to a nice restaurant, you don’t debate with the waiter about the relative value of grass fed vs. grain feed beef, and what you should pay for it. It works the same way with your inspection services.
The price is the price.
You must envision your inspection services as a physical product being offered for sale. Every physical product has a built-in cost associated with it, from materials, labor, shipping and handling to R&D, legal and management. There is a set cost to be covered prior to realizing a profit in every sale. This same business principle applies to your product. Countless hours of training, studying and learning combined with hands-on experience and professional service are all included in your product. Also included in the built-in cost of your product are your business expenses. From taxes and accounting to insurance, software, payroll and marketing expenses, all of which must be paid before any profit is made in your business.
It has been my experience that when the choice of service provider comes down to a small difference in price, it is probably to my benefit to have lost that person as a client. I find that, often, the person that is looking for the lowest price is also looking for the most product. And these unrealistic expectations can end up causing a good amount of stress for the agent, which in turn causes a good amount of stress for the me, the inspector. By simply avoiding a potential problem client, whose mindset is often revealed by their aggressive attempts to get me to drop the price of my product, I have saved my client, my agent and myself a good bit of stress.
My goal, as an experienced professional, is to provide a first-rate product that helps my client, protects everyone involved (including me), provides good value and leads to more quality business. By steering myself away from potential problem clients, I lessen my chances of future problems, thereby increasing the possibility of getting more quality clients. I attempt to abide by this mantra:
I don’t want all of the clients,
I just want all the good ones.
Why not try this in your business? Don’t shoot for all of the customers, just target the good ones. You just might find that when you deliver a quality product, your clients are more apt to appreciate it and more inclined to share their positive experiences on social media. And, you just might find that you get more enjoyment from your job when you are dealing with customers with more reasonable expectations.
Step up and step out.
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Thanks, Joe
