Stop Underpricing Work… It’s Critical to Your Reputation and the Future of Your Business.
If you are underpricing and undercharging for your lawn care work, you are doing your clients a huge disservice. Let me explain.
I get a lot of pricing questions. Companies aren’t sure how to price and new guys in the lawn care business have a tough time figuring out how to price. Estimating is also challenging. I get that.
This is a different take on it. It’s not the question I usually get asked, but I want to make a really important point. If you are undercharging your landscape clients, you are doing your clients a massive disservice.
The reason I have this opinion is because most of us, and I’ve said this before, started out as the “low-ballers,” which is a word we use in the industry. These guys are the ones underpricing and undercharging. They’re the low-cost provider that’s screwing up their whole business because every time they go out to compete for a bid, they’re giving the ridiculously low price that makes it impossible for them to make any money. That’s a “low-baller.”
If you’ve been in the business for any period of time, you’ve probably complained about this many times. You’re fed up with the guys that are underpricing work. They don’t know what they’re doing – blah, blah, blah. There’s a temptation to adjust your pricing to match their pricing. But, what happens if you do that? Then, you won’t make any money. This is the reason why it’s critical that you price right and do not undercharge your client. It’s a vicious cycle.
For example, if you do not price your services correctly, you cannot afford to hire the very best people. If you don’t hire the best people, then you don’t deliver excellent service to your clients. This is a huge disservice. If you don’t price your business correctly, then you can’t afford to train your people. Therefore, the work you give to your clients is sub par.
Worse, and an even a bigger sin, is the advice that you give your clients is wrong. If you tell your clients that they need something or you incorrectly diagnose a problem, you are wasting their money. If you are wrong, they could lose a plant, or a tree, or their turf could die. You have done them a huge disservice.
The way you give your clients great service is by charging them fairly and not trying to match your competitors that don’t know what they’re doing. It’s your job to price correctly so that you can hire the best people, train your people well, put them into safe trucks that are insured, and hire licensed drivers to insure everyone is safe on the road.
I am not preaching here. The point I am trying to make is that you need to have confidence in setting the right price. It’s absolutely the right thing to do…for your business, your employees, and your clients. Clients want great service. They want great quality.
Yes, you will lose some clients to the low cost provider. Eventually, they will get burned and they will be back willing to pay fair prices.
So many guys complain that they can’t get into their market because everyone is underpricing. Think about one of the biggest companies out there. It’s TruGreen. Their name and their marketing has supported higher prices than many companies actually charge. Oftentimes, TruGreen prices actually tend to be a little higher than the market.
There are plenty of examples of guys that are in the marketplace charging higher prices and succeeding in a massive way. Your client wants a great product. If you want your sales team to be highly effective, and you want your marketing to work, then invest in quality and service.
It’s kind of like a circle, it takes a little time for your sales and marketing to get going. It takes a little time to reap the rewards of investing in great customer service. But, as the business gets a little bit bigger and there’s more word of mouth, and you get a little more marketing out there, it will all start to pay off. If you combine great service and fantastic quality, more people will see it and it will all start to come together.
Sales, marketing, customer service, pricing, quality, employees, your trucks, your reputation, how you dress…it is all connected. The core of it all is pricing. Don’t be concerned with what everybody else is charging. You’re doing your clients a huge disservice if you can’t be the great service provider.
Low pricing in the short-term might give your business a boost, but in the long-term you will absolutely pay for it. Have confidence to price work correctly. Figure out how it needs to be priced. Go out there and do it. Improve your marketing, your sales, and your customer support so that you can get the higher prices.