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JimLewis
02-16-2009, 11:44 PM
This is the type of question I usually like to respond to, not ask. But in this economy I am getting underbid like freakin' CRAZY! So I need to now only use my usual responses but maybe have a few backup responses in my back pocket as well.

So when you give a bid, you know you bid it right, and the customer calls back and says, "Well, we really liked your company and your presentation the best. But after we got the other bids, yours was a little higher than all the others. We were wondering if that was your best price or if maybe you could bring your price down to be a little more competitive. We're really looking for a reason to go with you guys but price is obviously a big factor these days...."

I mean, with stuff like irrigation or hardscapes or retaining walls there are some great responses in regards to how long your product will last vs. the cheapo guys. But when it's just something simple like a sod installation, what kinds of things do you say to explain why you're more expensive and why someone should overlook the other, lower priced, contractors and go with you instead?

Again, I have my own usual responses to this. Just looking to start a conversation about this and maybe I'll pick up on something that I haven't tried or used before.

richallseasons
02-17-2009, 12:27 AM
I generally will not respond on the spot, what I will do is simply ask for the other bids, in writing if possible and then tell the customer that I will double check my calculations and ask them to please be patient as I want to make sure that I have all my bases covered, I then tell them that I will get back to them within 24 hours. This gives me the time to figure out weather I can meet the competitions price or not (sometimes you just cant) then if I can generally I will say that I got on the phone and made some calls and found the material at a better price or that I can adjust some labor time to save a few dollars but I will have to use less help so the job may take a day or two longer, or I simply cannot do any better as this is my best price.

The Lighting Geek
02-17-2009, 12:42 AM
I have historically been the highest bidder my entire career and I currently have a 95% closing rate. I believe the reason my closing rate is so high because I don't believe it is necessary the play the game as it is being played, I change the rules and make everyone scramble to catch up. Now that said there are a few things I need to make clear. I prequalify heavily, and I earn the trust of the client quickly. I have worked in residential, commercial, installation, maintenance, and of course the last few years landscape lighting. I believe commercial is a different beast and it is by far more difficult to overcome being the highest bidder, but it can be done. That said it is even more difficult in this economy. You need to find what you are unbelievably good at it and let your passion speak to the customer. For everyone that can be very different, but when your passion is from the heart, the customer knows they are going to get a great job. Don't be afraid of doing a little dreaming with your client, talking about how they would use the new yard, or how their customers would love the new look, etc. Act as if you are going to do the job without being arrogant. Be confident in your skills and the skills of your employees. Point out the difference, 'our employees are highly skilled'. Use terms that ring with the customer, which you will find out by asking questions. Pull their desires out and talk about how that will look. You get the point...

JimLewis
02-17-2009, 12:56 AM
Tommy,

I always appreciate your responses here on LS. Good to hear from you again!

It's a little hard to talk dreams or get people too excited when the job is something basic like just a sod installation. The common belief is that most any company is going to do sod about as good as any other company. And it's not something where people care about the warranty or anything. On a simple job like that, it's hard to distinguish yourself against the others.

Even though I know the guys who are outbidding me will be out of business in less than 5 years, it doesn't matter. The customer doesn't care about that. They don't care that the company doesn't know how to run a profitable business. They just care about the here and now and if they can hire that company and save a few hundred bucks, that's groceries for a few weeks. How do you overcome that?

The Lighting Geek
02-17-2009, 01:09 AM
I have always said, that if they don't understand the difference, they were not my customer to begin with. I always find that when I am faced with that situation, just sod for instance, maybe I am in the wrong part of the business. I am competing with the wrong people, and need to find my niche. A good niche that defines you makes it hard for the others to beat you. It took me about 2 months after taking over the Landscape division to figure out what makes this company unique and what do the customers that call want from us. I researched old phone calls and what the responses were. I talked to every customer that called, and in the beginning I did not get every job. We had a list of 10,000 past clients and 25 years of a great reputation in arboriculture. I found the niche in providing the same level of customer service that clients were used to, in a service that fit the company motto, 'The Kemper Way'. I redefined our services to fit and now I am booking jobs in April in stead of 3 days out.

I think you need to find a very specific need and then become the expert they are looking for.

letsplay
02-17-2009, 02:14 AM
Jim,

Don't be scared to make your proposals or estimates stand out from others either. It just might be a sod installation today but two months from now it might be a new tree and shrub installation etc. We take just a little extra time on our proposals to add "Options". The client probably did not ask for it but we have found that it shows to them that we might know their property better then the competition b/c we have taken the extra time to consider enhancements. Maybe you have a 1000sqft sod installation but you also add the option to do bed edging or metal edging. You might not get the sod installation but the customer might call you back to do the bed edging and or metal edging or refer you to someone else that asks about those services.

Don't be scared to be creative and show clients why your are different from the competition. Another brief idea is just sketching or drawing a simple diagram of what or where on the site you are planning on doing work. Many clients have a hard time seeing what they are going to get and a simple drawing helps. Now don't go crazy and design an entire front yard project for the competition to bid on........keep it simple. We have actually been asked to bid on projects at the last minute for landscape installation projects and gotten the job and options such as night lighting because we took the time to reduce the landscape design drawing and show the owner exactly where we would install light fixtures.

I have also seen and heard about so many contractors losing projects b/c they just drop off their proposal at the front door or mail box and do not have any face to face time with the client to even briefly explain their proposal. In this time and age of email, texting, voicemail, etc I think clients really appreciate just ten minutes of your time to show you care and that you want to earn their business. Infact this is one way we weed out clients by their reaction to us proposing to meet with them and go over the proposal or atleast call them first and then send the proposal. If they just want us to send the proposal by email, fax, etc and have no interest of talking then it is a pretty good indication they are just shopping numbers and looking for the lowest bidder which we rarely are.

This is just my opinion but even in this econony I think contractors leave money on the table for projects. Now there are always going to be lowballers that are going to go out of business sooner or later. I agree with Toms advice above that if you can find a niche that you can be competive in and that you truely enjoy doing....it will make a big difference in your sales pitch and how often you seal the deal and your not the lowest bidder. Well I have written a novel, Good luck.

letsplay
02-17-2009, 02:16 AM
Lighting Geek,

Where does the saying the "Kemper Way" come from? I ask because that is my name and you don't see it used very often so just curious.

Thanks

AGLA
02-17-2009, 08:32 AM
Jim,

If the problem persists on these types of jobs (and you really want or need them) and you still can't come up with a reason why you shouldcharge more than someone else, what is that telling you?

If you are knowledgable (a given in your case) and don't know why you should charge more then maybe there is no good reason. Just as there is good reason to raise your prices when the economy is growing, sometimes there is good reason to lower them when it is shrinking.

I'm not saying it is good to lower prices, but if you have to, you have to.

So I'll ask you. Why do you charge more?

White Gardens
02-17-2009, 10:30 AM
The few times I've been bid against, I've asked the customer what the other companies credentials are.

As soon as I bring up insurance, I usually here " Well I don't know if they are or not. "

Then I also bring up quality. Have they shown you any work they've done in the past etc.... I always come armed with my portfolio in case there are any questions about my work.

In the end my customer service, extended warranties, and image have seemed to land me the job.

It's a tough economy out there right now. The only thing I like about it is that it's going to weed out the low-ballers who want to do work for nothing.

It's frustrating non-the-less. :hammerhead:

Az Gardener
02-17-2009, 12:37 PM
I think there are quality issues in every sale, even sod. Is the other company prepping the soil, are they bringing grade up to walkways and other hard surfaces so people are not "falling off the sidewalk for years twisting ankles". Are they going to bring unseemly characters into the neighborhood to do this job. Are they going to do a good job cleaning up and not destroy other things in the process.

If everything goes right it is simple but how often does everything go smoothly especially for people who are cutting corners.

So you gotta ask your client "Are you feeling lucky?'"

PROCUT1
02-17-2009, 01:03 PM
Jim

This is the exact battle that I had when I was in the business. Unfortunately the "simpler" the service the harder it is to justify a price difference. Mowing was the worst.

There is a tipping point in the business where references and quality become the determining factor over price but even that is not foolproof.

A prospective customer will see a neighbor get a beautiful wall built and they will want work at their house like it. They will probably be shocked when they get prices from the professionals. It may be out of their price range.

But then you get a guy from the local paper that shows up and says "I can do what your neighbor has and it will be xxxx" Much cheaper than the other estimates.

Now the customer is deciding whether to not do the job, or to take the chance with the unknown guy that may be able to do it. Going back to the professional and asking him to price match is to give them the peace of mind that it will get done.

In this economy its only going to get worse.

The reason I target only large commercial work in the sealcoating business is because it is such a "permanent" service, customers are wary of what can potentially be a long lasting irrepairable screwup.

When I meet with them I take the attitude of an equal. They are a powerful realestate owner and Im a powerful contractor. I use no sales pitch. I dont talk about lowballers and such.

In my market, Im able to "throw out names" of other big realestate players that I service and I start the conversation with my resume and references. That immediately sets the tone.

The customer knows right off the bat they are dealing with someone who does this every day, knows it inside out, and is not wetting his pants to do the job.

In their mind their shopping center is a big job. When they meet me they see that we do properties twice the size of whatever they have with our eyes closed.

That makes the tone a lot different than the guy the pulls up who seals driveways and tells the owner "he can pull it off".

Its just like when you go to the store and see prices on the shelves. You know walmart has a system of pricing to be competitive and ensure they stay in business. You dont even think to negotiate there because its so matter of fact.

I do the same.

Even in my business I still run into the same problem. I dont PUSH residential work but I will do it.

My pricing for driveways is higher than most of my competitors. I find that many people will pay the little bit more to have the same contractor that just did the local shopping mall do their little driveway.

Others will see my price of $200 and pound the heck out of me why others want $150.

Many times I just have to say "no thank you"

I dont know if I made any sense in this post, Im just kind of typing out loud.

I guess it comes down to sometimes you just cant justify the higher price in a way that the customer cares.

PROCUT1
02-17-2009, 01:05 PM
Like with mowing.

90% of residential customers dont care about insurance, taxes, registration, uniforms, ZTRs, equipment, or anything that we think about.

They see tall grass and want someone to mow it thats not them.

So trying to sell them on all of the above as reasons to why your price is $10 a week more isnt going to work when they really want a "deal" which to them is the guy doing it on the side for cash.

LB1234
02-17-2009, 01:35 PM
As other have said, bottom line, you need to pre-qual your potential customers. If I already provided the quote and its significantly higher and need to find out first if I screwed up my 'pre-qual' and they are the type were cost is the #1 priority. If they are, cut my losses and move on to the next one. Its not even worth my time to try and explain.

However, if price isn't their #1 priority than I need to get them into the realm of price isn't the only major factor in determining who to get with. Yes, track record (i.e. references) and quality are a definate. However, how about what happens when the competition is done with the job and when we are done with a job.

As for your sod example or a simple landscape install...

We would provide a maintenance write-up. How to water, when to water, when to mow, when to fertilize. For our landscape installs we provide a document with pictures and a write-up for maintaining the plants (when to cut back perennials, when to trim the hedges, etc.). We would let them know we would be stopping in periodically over the next few months to make sure they are not under/overwatering. We would let the know of signs of trouble or caution them for a potential problem. If they had a sprinkler system we would set that zone for them and then come back and reset as necessary. If they didn't have a sprinkler system we would explain what they needed to get for proper watering. Going a little further we would set it up at no charge if they had everything available the date of install. How about warranty issues? We might also ask who the other contractors are getting their sod from (say we had issues with a certain vendor yet they are cheaper). We would also go over the install step by step to make sure that other company is doing EVERYTHING we are doing. Who is there materials provider? Is the other company willing to walk with the customer at the nursery so they can get a close-up look of what the plants look like? How about plant sizes? Even a simple landscape install price can vary between utilizing 3 gallon versus 5 gallon pots or hardwood mulch versus cedar?

PROCUT1
02-17-2009, 01:56 PM
The other thing to keep in mind. And this is the toughest one of all.

Sometimes the competition is cheaper and actually does good work.

We're all quick to think that anyone cheaper than us is going to do less of a job or poor quality.

Sometimes theyre cheaper because they dont know how to run a business and they are on the road to failure.

Sometimes theyre cheaper because they know something we dont.

Think about this.

If I prebuy a very large quantity of sealcoat I can save almost 30%. I would need over $100,000 to pay upfront for this.

If my competitor has the money and does that, he can beat me out on every job by 30% and make the same profit I am.

Not knowing that, i would be saying "How the heck does he do it so cheap?"

PROCUT1
02-17-2009, 01:58 PM
If I do a great job with the same material and he does a great job with the same material and we both have impressive references, then how do I justify the price difference to the customer?

Now there would be a dilemma.

LB1234
02-17-2009, 01:59 PM
great point pro-cut.

to add to that (and not wanting to start anything)...

they could be using illegal labor as well.

AGLA
02-17-2009, 02:03 PM
All of the comments make a lot of sense, but when it gets to the point where you are not getting enough work, you have to adjust your price no matter how good you are or how equal you are to your clients. Until that happens, you should stick to your guns and get paid as well as you can.

When the economy is hot, being good gets you more money. When the economy is slow, being good gives you a competitive advantage to get work, but at the same price as your close competition.

It is not going to be as easy as a lot of people think as the year progresses.

PROCUT1
02-17-2009, 02:13 PM
All of the comments make a lot of sense, but when it gets to the point where you are not getting enough work, you have to adjust your price no matter how good you are or how equal you are to your clients. Until that happens, you should stick to your guns and get paid as well as you can.

When the economy is hot, being good gets you more money. When the economy is slow, being good gives you a competitive advantage to get work, but at the same price as your close competition.

It is not going to be as easy as a lot of people think as the year progresses.

Excellent post. Exactly what I said but in much fewer more clear words....haha

Its gonna be a tough year boys.

People who didnt scrutinize price in years past will be this year.

Im doing it myself. Im going through every single bill and expense my company has and trying to cut it. Unfortunately in this climate it sometimes means severing long time relationships with vendors.

Im not doing that by choice. Im doing that because I HAVE to cut expense.

And dont think your "loyal" customers wont do that to you.

When theyre getting laid off and afraid of losing their homes, those $20 lawn flyers are going to get looked at. And youre not keeping the $40 account no matter how dependable you are or how good a job you do.

Two years ago, you would have. This year....Wait and see.

larryinalabama
02-17-2009, 02:55 PM
Make a photo album with some high quality pictures of you work.

JimLewis
02-17-2009, 03:18 PM
I think there are quality issues in every sale, even sod. Is the other company prepping the soil, are they bringing grade up to walkways and other hard surfaces so people are not "falling off the sidewalk for years twisting ankles". Are they going to bring unseemly characters into the neighborhood to do this job. Are they going to do a good job cleaning up and not destroy other things in the process.

If everything goes right it is simple but how often does everything go smoothly especially for people who are cutting corners.

So you gotta ask your client "Are you feeling lucky?'"

Thank you! Great response. I can use some of that!

JimLewis
02-17-2009, 03:23 PM
I'm not saying it is good to lower prices, but if you have to, you have to.

So I'll ask you. Why do you charge more?

Well, we are on par as far as rates with other quality companies our size and level of experience.

But when you compare our company with the new companies (and there are hundreds out there in this area) who have little overhead because they are just working out of their garage, they hire day laborers and pay them cash so they have no real labor burden, they don't have uniforms or lettered trucks, they carry the minimum on every insurance, they don't get all the appropriate business licenses for the city, county, state like they should. But some people just don't care about stuff like that. They aren't thinking about whether the guy has a lettered truck or has real employees or has the proper city license. They're just looking at whether they think he can install a sod lawn or not and how the price compares to mine.

So then it's my job to sell the customer on why they'd pay more for me. But there is only so much you can say. I like AZ Gardener's ideas on what to say. That's along the lines of what I was thinking but he said it more concisely than I would have.

Lawnworks
02-17-2009, 06:07 PM
To me on the basic sod options, you have got two options. Either leave it or take it. I you have good guys, get the job and keep them busy... if there is no benefit just leave it. Sod is sod guys. Anyone can throw it down... unless there is a drainage issue.. there is no reason the low bidder can't get it and satisfy.

I think Jim's specialty is the higher end jobs, where he can knock the socks off the clients.... but lets face it a sod job is a sod job... just about anybody can figure that out.

The Lighting Geek
02-17-2009, 07:45 PM
Lighting Geek,

Where does the saying the "Kemper Way" come from? I ask because that is my name and you don't see it used very often so just curious.

Thanks

I currently work for Kemper Tree Care Inc.

ford550
02-17-2009, 10:12 PM
Hey Jim,

I agree with what has been said in this thread. I hear where you are coming from. I know you were talking about sod. But for most things I just show them a picture of my competitions work a year or two after it has been installed and I usually can justify why I charge more and close the deal. See reference picture of what I am sure everyone has seen before with cheaper bidding, less eduacated contractors.

This is nice.....

AGLA
02-17-2009, 10:18 PM
Jim,

I don't understand what is new about this situation. It has always been that the new guys without insurance and without a grip of what their overhead is have been out there under pricing. There must be a reason that this has become a concern to you when it did not seem to be a pressing issue before.

Could it be that the economy is changing things? I believe that we are all having to shift down to lower markets because the higher markets that pulled us up don't need to pull any more. We are all going to have to face the reality that in order to fill out the schedule, we need to reach down and compete with the people who could not reach up to compete wih us (no matter what level you work at) a few years ago.

Are they going after your market, or are you going after theirs? You don't have to answer that, just think about it.

Pro-Scapes
02-18-2009, 10:43 AM
Jim I didnt have time to read thru the whole thread.

Like Tommy I am usually the highest bidder. We also have a very high close rate. In lighting I have a reputation for getting the job done and getting it done in a great looking flair. I am usually 50% or more higher than the competition.

On the sod type jobs. Your clients need to be 100% sure they are getting the same quality in the lower price they are getting with yours. I always tell my clients or potential clients up front I will not be the lowest price but if they want it done right and want it to look good for some time to come then I can make it happen. I have started to sub out landscape constuction and irrigation work. The sub I use is now a good friend and he too is on the high end of the pricing scale but his reputation to get the job done right and get it done so its going to look great years from now commands the higher price tag.

I do think you too perform great work. There is a definate holdback on spending with some brackets of clientel right now and in this situation I usually break down a project in to digestible phases. It is much easier to get a client to do 4500 and 5500 phases than it is to get them to do 10k

Become an advisor to your clients. Dare to dream like Tommy said. Even if they cant do it all right now let them know your looking out for them in the long run. Now if its only a few hundred seperating you from the competitor then the options are diff. Either the client doesnt value the quality of your work or they want the lowest price period. You can either come down to the lower price if possible or you need to increase the percived value of your work.

My selling point is everything I do as far as lighting is hand installed and I the owner of the company is on site the entire time.

Pro-Scapes
02-18-2009, 10:49 AM
To me on the basic sod options, you have got two options. Either leave it or take it. I you have good guys, get the job and keep them busy... if there is no benefit just leave it. Sod is sod guys. Anyone can throw it down... unless there is a drainage issue.. there is no reason the low bidder can't get it and satisfy.

I think Jim's specialty is the higher end jobs, where he can knock the socks off the clients.... but lets face it a sod job is a sod job... just about anybody can figure that out.

That is far from true. I have seen sod jobs where they have used a lower price material and a year later its nothing but weeds. I have also seen shoddy sod jobs that resemble craters on the moon. Proper installation is key to a healthy and smooth lawn.

JNyz
02-18-2009, 01:38 PM
That is far from true. I have seen sod jobs where they have used a lower price material and a year later its nothing but weeds. I have also seen shoddy sod jobs that resemble craters on the moon. Proper installation is key to a healthy and smooth lawn.

Hey Billy,

I think you just answered your own question. There is a difference in every job and you have to make this known to every client. You also must be in the clients face, not over the phone, email or text. Someone said use pics of competitors work 1-2 years later. Great idea. Your portfolio is also very important if it is only a small job. The more you talk to your potential clients the better it will go. Small and off topic conversations work to get the client to like you. If the client likes you he will like giving you the job. Get him to like you.

Quick story. Last year a neighbor came out to get a mulch price. Told him 125.00 per yard for a total of around 700.00. He said it was too much. I started talking about his Porsche and complimented him on it. We started laughing and talking about a few other things. The conversation ended and I started walking away and turned around and said if you change your mind just let me know. He said "go ahead and do it." If I walked away after he said "it is too much" I would never of done the job. I just stayed in his face and got him to like me. Could he of got the job done cheaper. Sure, but I got it.

topsites
02-18-2009, 03:25 PM
But when it's just something simple like a sod installation

Excuse me, but you think sod is simple then I can show you the lot of a customer
who paid well over ten thousand just to have the crap dead within 2-4 weeks.

Which, I'm not saying that your thinking of sod as simple is bad.

Peace

AGLA
02-18-2009, 05:46 PM
Just because some people can screw it up does not mean that it not simple.

PROCUT1
02-18-2009, 06:10 PM
Excuse me, but you think sod is simple then I can show you the lot of a customer
who paid well over ten thousand just to have the crap dead within 2-4 weeks.

Which, I'm not saying that your thinking of sod as simple is bad.

Peace

A triple bypass is simple.

For a heart surgeon.

For you or me......Not so much.

Isobel
02-18-2009, 07:59 PM
That's a tough one. I have my own set of explanations, including insurance, warranty, quality--all of which I bring up during our initial consultation and again in their written estimate.

But what I've found is that if the client brings up the price on the other bids, then they are price hunting, and don't really care about quality, insurance, or anything but the bottom line. I can't negotiate on my price, and I don't.

What do I do when presented with a question like that from a price hunting client. I stick to the basics--quality, warranty, experience, and insurance. Usually the client moves on, and I do too, happily.

JimLewis
02-19-2009, 12:34 AM
Jim,

I don't understand what is new about this situation. It has always been that the new guys without insurance and without a grip of what their overhead is have been out there under pricing. There must be a reason that this has become a concern to you when it did not seem to be a pressing issue before.

Could it be that the economy is changing things?

What's changed is in my area there has always been a greater need for landscapers than there was supply. In the spring and summer months I will often hear this from a customer, "Wow! You actually showed up! I can't believe it. You guys were like the 6th company I called. I never got a call back from the first 3 and the other 2 never showed up to their appointment."

I don't get that anymore. It's more like, "Well, you're the 2nd bid. I'm getting 2 more this week...I'll get back to you."

Supply is now more than demand. Used to be the other way around.

The other thing that's changed is people are a lot more price conscious. It was never like that around here. A lot of times in the past, our customers weren't as concerned about price as they were about reputation, quality of work, references, etc. Now there is definitely a little bit of a shift more toward price being the most important item.

AGLA
02-19-2009, 02:27 PM
Bingo!
It is still about favorable quality, service, and price. The difference is that all three are much more available now. They used to take less quality or pay more if it meant not waiting three months. Others would wait months and pay more for the people they felt were the best. Still others would put up with crappy service and poor work just to get "more" for the money.

Now they can have us start right away, negotiate the price, and only deal with people who do quality work.

You always have to be competitive. Competition is only those who you can take work from and who can take work from you. When the gravy train was rolling there were less that could do that. Now you can lose more jobs to others. You have not changed, but the market has given more opportunities to lose jobs. By my definition, you have more competition even if there are less landscapers out there.

Lawnworks
02-19-2009, 07:22 PM
That is far from true. I have seen sod jobs where they have used a lower price material and a year later its nothing but weeds. I have also seen shoddy sod jobs that resemble craters on the moon. Proper installation is key to a healthy and smooth lawn.

I have also seen sod jobs that I have been underbid on that look good. As far lower priced material, at least where I am from... you cannot tell a difference between lower priced sod farms and higher priced sod farms. My primary sod source has a lower price and a better product than the higher priced sod farms.

Also, if the customer is searching for the best price, it is no wonder that the yard looks like weeds in a year due to the client's emphasis on "cheap" and probably did have adaquate irrigation and weed control program, but it seems trying to sell a client that has no monetary intentions of maintaining his investment is fruitless.

I guess the key now is selling a quick installation and making a connection with the customer or changing your advertising to market to the ones that demand quality services.

Unfortunately in supply and demand market, when supply is high and demand is low the price drops.

AWJ Services
03-02-2009, 10:00 AM
I always "listen" to what the customer is saying.
Sometimes what comes out of there mouth and what they mean are 2 different things.
Adjusting your price slightly is perfectly acceptable.
Sometimes a price adjustment is not what they are asking for even though that is what they are saying.
The news media has everyone convinced that we are broke or going broke and it has everyone in panic mode necessitating there mental need to save money regardless of there financial state.Sometimes pacification is all they want.

The other thing that's changed is people are a lot more price conscious. It was never like that around here. A lot of times in the past, our customers weren't as concerned about price as they were about reputation, quality of work, references, etc. Now there is definitely a little bit of a shift more toward price being the most important item.

This has been our market here for the past several years.
You have to maintain profit margin regardless.If you start lowering your prices then so will the lowballers.Remember they are after your piece of the pie not the other way around.

topsites
03-02-2009, 01:51 PM
How about "oh my" or maybe "oh dear, not again"
also there might be some "%&^$%" going on.

JimLewis
03-02-2009, 03:34 PM
Well, when I asked this question I was thinking of a specific job I was bidding on. Good news - I got the job! I used some of the stuff we discussed here and I was the highest bid but still got the job!

Lawnworks
03-03-2009, 08:14 PM
Well, when I asked this question I was thinking of a specific job I was bidding on. Good news - I got the job! I used some of the stuff we discussed here and I was the highest bid but still got the job!

I don't know about you, but the economy doesn't to be having a terrible effect on residential landscaping. Through the winter I thought the world was coming to an end, but maybe this year won't be that bad. I am getting calls and getting bids out. I think the key is that this year, I am going to try to "sell" my services more and possibly try to be more bold but still honest. I may even try to see what the other bids are at... why not? I really need to read that Dale Carnegie book "Making friends and influencing people." Relating to people and figuring out what people want and what is going to motivate there decision is key to landing jobs.

JimLewis
03-03-2009, 09:26 PM
I don't know about you, but the economy doesn't to be having a terrible effect on residential landscaping. Through the winter I thought the world was coming to an end, but maybe this year won't be that bad. I am getting calls and getting bids out. I think the key is that this year, I am going to try to "sell" my services more and possibly try to be more bold but still honest. I may even try to see what the other bids are at... why not? I really need to read that Dale Carnegie book "Making friends and influencing people." Relating to people and figuring out what people want and what is going to motivate there decision is key to landing jobs.

Yah, well I sort of agree. I mean, there are still a decent amount of residentials who are having landscaping done this year. We made a good 35-45 good contacts at our booth at the Home & Garden show a few weeks ago. And all of them were planning on having some landscaping done this year. So it's not totally dead.

But what's gone is the easy money that really used to drive the demand for landscaping sky high. Used to be, 2 years ago, everyone's home values were going up 10-20% per year in our area. I remember my home value went up 20 one year. I was ecstatic. So everyone was getting a re-fi and pulling out equity in their homes and using that money for some landscaping upgrades, a new kitchen, etc. Now all that equity money is gone. Some people are still doing re-fi's but not pulling out any equity.

Another thing we used to see a lot was people moving up from rich parts of California (e.g. Silicon Valley). They'd move up to Portland after selling their 3000 sq. ft. house down there for $950,000 and buy the same house up here for $450,000 and have a bunch of equity money in their pocket. So once they moved in, it was like new kitchen, new water feature, new lawn, new patio, new boat, etc.

That doesn't happen anymore either.

The third group of people who used to hire us for landscape design / build were rich people who had $50,000-$100,000 or more in the bank (mutual funds). So they'd just pull out some of their investment portfolio money and hire us to do some landscaping.

Well even those people have lost 25-50% of their investment equity. So we lost a lot of that as well.

So now we're down to just working for people who have money that ISN'T equity money, and people who are still have a high income. So there are still jobs out. Fortunately, our company is positioned to impress people in that bracket better than some of our competition is. So that helps. We're probably getting more calls than much of our competition is. But I wouldn't say things are looking great. Things are looking just okay.

JimLewis
03-03-2009, 09:31 PM
I really need to read that Dale Carnegie book "Making friends and influencing people." Relating to people and figuring out what people want and what is going to motivate there decision is key to landing jobs.

You're referring to "How to Win Friends & Influence People." Probably the single best sales-related book ever written. One of my favorite all time books. I've read that from cover to cover at least a half dozen times and every time I learn something new or am reminded of something that I should be doing that just didn't sink in last time I read it.

What an amazing and timeless book. If only everyone would read that. It should be required reading.

I've got a soft cover copy of that book that is so highlighted and written in (notes) that it's half way fallen apart. Then I've got a really nice like 1950s hardback edition of that book that I found on eBay one day that is still in great shape. That's the one I read nowadays. I think I'll start that book again today. Haven't read it in years. Just the first chapter alone would make most people 80% more pleasant than they are, "Don't criticize, condemn or complain." I still do a little too much of all 3 of those things. Yah, I think I definitely need to go back and start that book again. Good stuff! :)

zedosix
03-03-2009, 10:10 PM
I would like to hear how Canadians are doing, how is your workload and are you feeling the recession in your hometown? Anything signed yet, any proposals going out? I know there are a # of canadians on the site:canadaflag:

JimLewis
03-04-2009, 01:09 AM
What are Canadians??? Is that part of California? :usflag::usflag::usflag:

zedosix
03-04-2009, 08:17 AM
What are Canadians??? Is that part of California? :usflag::usflag::usflag:

Sorry I forgot, its that little piece of land on top of you guys that you want to get your hands on...how could you forget.:canadaflag::canadaflag::canadaflag:

etwman
05-30-2009, 06:14 PM
I have historically been the highest bidder my entire career and I currently have a 95% closing rate. I believe the reason my closing rate is so high because I don't believe it is necessary the play the game as it is being played, I change the rules and make everyone scramble to catch up. Now that said there are a few things I need to make clear. I prequalify heavily, and I earn the trust of the client quickly. I have worked in residential, commercial, installation, maintenance, and of course the last few years landscape lighting. I believe commercial is a different beast and it is by far more difficult to overcome being the highest bidder, but it can be done. That said it is even more difficult in this economy. You need to find what you are unbelievably good at it and let your passion speak to the customer. For everyone that can be very different, but when your passion is from the heart, the customer knows they are going to get a great job. Don't be afraid of doing a little dreaming with your client, talking about how they would use the new yard, or how their customers would love the new look, etc. Act as if you are going to do the job without being arrogant. Be confident in your skills and the skills of your employees. Point out the difference, 'our employees are highly skilled'. Use terms that ring with the customer, which you will find out by asking questions. Pull their desires out and talk about how that will look. You get the point...

I don't often have time to sit down and read stuff on this site as much as I'd like too. However, I did manage to do a little surfing and came accross Tommy's quote here. Without any exaggeration, this might be one of the best pieces of advise I have read on this site in a very long time. Tommy is dead on with what he says here. Read it and take it to heart. Matter of fact, I'm going to print this and put it on my tack board by my office desk.

freddyc
06-01-2009, 12:02 PM
Jim,

Being a superior salesperson and having a can-do attitude are the way to get ahead in a slow economy. I have seen some of your other posts and have to say that you do great work, and don't have to hang your head to anyone. That being said, it sounds like you have "your" area covered--that being the more difficult hardscaping work.

Your sales skills can't be bad or you would have never gotten the work you have. And, your tech ability is good because your pictures prove it.

So you just need a hook for what might be considered more mundane work. Looking at it another way, if you were interviewing for a job, you're over qualified. You just need a way to make your more advanced skills fit in and sell you in the other area for a little higher price.

I think your hook might be to really sell up the prep work based on your experience. For instance, in putting in sod, as you said its generally considered the same no matter who does it. Remember that it might be based on the customers understanding of what needs to be done. They probably have no clue about prep work---they just want a sod lawn.

So if the sods the same from anyone else, the best selling point is the prep work---and thats where you excel from your experience. Judging from some of your previous pics, you should be extemely confident in your abilities. Projecting that to your customers will make you win. Never forget the influence of being likeable.

A customer once told me-- "you got the job because when you came to look at it, you were all business". In short, when you're looking at a place, pretend its yours. If you're excited, so are they and thats a real good step to being liked. In your case you have a really good record and tons of completed projects. Invite them to actually go and see one in person if you can. Nothing sells like tangible evidence. A lot of people would love to have your portfolio.

Usually at the end of my first exposure, I will start talking about schedule--in short, start talking like you already have the job and you just want them to lay out when they want you to start---"do you need this done in the next two weeks?".... but be subtle. For people who just need a little push this usually works--they are relieved that they found someone to do their project for them. But I'm sure you already know this from your experience. I find it to be relatively powerfull in the right cases.

Fishwhiz
06-02-2009, 09:52 PM
Sorry I forgot, its that little piece of land on top of you guys that you want to get your hands on...how could you forget.:canadaflag::canadaflag::canadaflag:


I have been wanting to get my greedy lil hands on BC and Alberta for sooo long now! We take those provinces and give the frogs the rest of Canada and I am a happy camper, fisherman, hunter, skier etc etc !

Fishwhiz
06-02-2009, 10:24 PM
Jim,

Great discussion you've started here, thanks!


I know little or nothing about sod installation, so please forgive if some of this is naive, but I do understand value selling.

If I were approached to perform a "simple" job like sod installation, I'd change the paradigm and the client's perspective. The first thing I'd say to the potential client is something like: "we stopped doing just sod installation because we really value our reputation for client satisfaction. however, What we do offer is a site inspection sod installation package where we look for any long-term potential problems your site may pose to the health of your lawn and surrounding landscape. We then correct those issues that could cause scenarios like burning, moss, poor drainage etc etc, then we choose the sod we know will match your situation based on our billions of years of local experience, etc.

If you calmly sell your concern for your reputation via your genuine concern for your client, it works. I thnk it's more of a "here is what I would do if I were you" instead of a "this what the best thing is to do". The difference is you are providing empathy and compassion for the client instead of selling a product. You also have to show them a very calm confidence that you are delivering terrific value, especially in this economy.

In every case we separate ourselves from our competition. If we can't then we probably won't explore that aspect of the business. If we sold pond aerators like everyone else does, we would only do so after we did a site analysis and made sure the client needed a pond aerator. Yes we would charge for the analysis and yes we would smile and tell the client he/she didn't need the aerator after all. We may have only cleared $ 200, but we just gained a client for years to come via their trust. You would be shocked to learn how many people buy equipment they just don't need, only because they "thought" they needed it and the equipment salesman was in no mood to disagree.

People value trustworthiness. I know squat about sod, so I will probably really appreciate you taking care of me by helping me avoid future lawn problems. Unless a client is starving - in which case why would he even spend money on sod - they will most always invest in good value.

In my work, the bottom line to any proposal is to always leave them drooling. At that point price is rarely an issue.




And by the way... GO BEAVS !!!!!

SC Irrigator
06-02-2009, 10:39 PM
i usually just say....keep my number b/c when they come in and not do the job right call me and ill fix it....im good at that ....lol.....cant tell you how many times that has worked.....

Lite4
06-06-2009, 08:53 PM
This has been an interesting read. It is funny how everyone is "adjusting" their prices in a race to compete with the bottom feeders. Did your operating costs suddenly go down this year over the last? So why are you sacrificing the long term health of your company to try to compete with those who are not even in the same class of contractors as we are? Those clients who are simply looking for the cheapest price don't care about you or your companies long term health. They don't care if you are there to service their needs when they may need you again. So why would you want to work for someone like that? Have some pride in your company man. It takes a lot of work and hours away from your family to get a company growing and healthy, so why throw it all away because of some cheapskate customer? We base our pricing on what our operational costs are and on what we need to make as a company everyday, not on what our competition is making.
We have actually raised our prices this year. I may do fewer jobs but my profit margin will be higher so I will make just as much if not more on the few jobs I do as I would have if i had done a bunch at a lower price. Just like Tommy said when I meet with my client my goal is not to compare what I do with my competion. My goal is to simply make them forget about the competition and have a singular desire to use me for their project. How do you accomplish this, well to coin a phrase from a Canadian lighting guy who is also on this forum, "you must make yourself and your company REMARKABLE in the eyes of your clients." always remember, the estimate process is a job interview. What makes you more remarkable than your competition. What are you going to bring to the interview that seperates you from the other applicants that your customer will be interviewing also? What will be memorable or worthy of note or REMARK about you?

Now, there have always been and always will be those who are soley price driven, but they are not my customer anyway because they are a pain in the neck to deal with. When you win a contract or lose a contract do any of you follow up with that client with a phone call and ask him or her why you did or did not get the job? Was there anything that you presented that pushed that client over the edge in your favor? Maybe something your competition did or said that you didn't that got them the job? Most all clients will happily let you know what was attractive and what sold them whether it was you or not. Every sales call whether you get the job or not is a learning opportunity to refine you sales techniques and be more appealing and effective for future clients. I have always been the highest or one of the highest priced, but I willl usually always get the job if they are honestly looking for quality work.
A couple of things to think about:

1. How much time are you spending with your clients? 5 minutes, 30 minutes, 2 hours, 4 hours? Have you spend enough time to get to know them and find some common ground not related to your services? (have you made a friend!) Get to know your customer and show genuine concern and interest for their needs. Make their needs, your needs and you will gain trust and genuinly connect with your clients. Often times when I am on a sales call I won't even bring up lighting for 30-40 minutes if we are talking about various other things. I am getting to know these folks and they are getting to know me on a more personal level. (building trust).

2. Do you instill confidence with your knowledge of your craft. (Remember, we are selling a product, but they are buying YOU!) Plants, pavers and sod don't magicly plant themselves and create beautiful spaces on their own. It is the craftsmanship of the artist that makes the difference. If we "artists" are all providing the same thing, why do Rembrandt and Van Gogh paintings sell for hundreds of thousands of dollars and some artists can't give their art away?

3. Do you present a professional image? How are you dressed, Clean clothes? Did you shave? Hows the BO? Believe it or not these little things make a huge difference in your presentation and first impressions are lasting impressions. Do you want your client to be thinking about your photos and dreaming about their new outdoor kitchen or distracting wondering why you stink so badly and didn't take the time to get cleaned up before meating with them. This is one place that is easy to stand out as I have seen how most contractors are very sloppy and poorly groomed when they are presenting a job for 50k. Oh yeah, I feel safe giving you my money- NOT! If they wanted a bum to do their work they would pick up help at the local mission.

4. Do you have professional prepared presentation materials? Everyone is visual, so you better have some stuff that looks professional and 1st class. I definitely recomend a hard bound portfolio book for this and some manu type brochures, Tommy the Geek can hook you up with this. Samples are great too but don't overwhelm them with too many options. Remember you are the Doctor and they are the patient. You know what they need better than they do. Ha, that's why they called you in the first place dude!

5. Have confidence dude! Assume the sale before you meet. Have energy and enthusiasm for what you do and present. The customer will catch that excitement as you paint the picture for them. Have all your closing materials with you so you don't have to make the customer wait and cool off. Let them buy from you when they are excited and chomping at the bit and it will be much easier to close the sale. Do a quick design on site and present a proposal for the work before you leave them. I know this equates to spending a good deal of time with them but hey, Refer to point number 1.


Some contractor on Lawnsite had this saying at the bottom of his signature: "It is not our job to make it affordable, it is your job to afford it." I like that a lot. Press on guys, it's not as bad as the media lets on daily. There is still plenty of work out there. GO GET IT!

lifetree
06-06-2009, 10:43 PM
I generally will not respond on the spot, what I will do is simply ask for the other bids, in writing if possible and then tell the customer that I will double check my calculations and ask them to please be patient as I want to make sure that I have all my bases covered, I then tell them that I will get back to them within 24 hours. This gives me the time to figure out weather I can meet the competitions price or not (sometimes you just cant) ...

Excellent information !!

keepcuttin
06-14-2009, 02:57 PM
I went to ME for an estimate on a irrigation system, it took me about 4hrs to map it all out and really process what the landscape needed and what it should have. I was $1100 higher than the other 2 bids (local co's). I think the landscape designer was more impressed that I took the time to evaluate the property and to talk to him about the present plantings and future ones and not just throwing some numbers to him. Now this house is next to the ocean and is over 1mil and the house behind him is over 2mil and from what i've heard they want to be next.... sometimes its not all about the numbers its in the presentation...

Isobel
06-14-2009, 03:18 PM
I went to ME for an estimate on a irrigation system, it took me about 4hrs to map it all out and really process what the landscape needed and what it should have. I was $1100 higher than the other 2 bids (local co's). I think the landscape designer was more impressed that I took the time to evaluate the property and to talk to him about the present plantings and future ones and not just throwing some numbers to him. Now this house is next to the ocean and is over 1mil and the house behind him is over 2mil and from what i've heard they want to be next.... sometimes its not all about the numbers its in the presentation...

that's impressive.
good job! :clapping:

Isobel
06-27-2009, 08:04 PM
I just lost a client, had estimated a job for some new landscaping, pruning the existing property, mulch, some lawn repair, came out on the order of 5k. Some other landscaper said he'd do everything for 2500. wtf?
I don't understand how anyone makes money doing stuff like that.

oh well.

JNyz
06-28-2009, 05:41 PM
How did you present itto the client? in person, email, mail?

Isobel
06-28-2009, 05:47 PM
met with the client, also emailed, client thought about it chatted it over with the wife over the weekend, and then said he found someone cheaper.

JNyz
06-28-2009, 05:55 PM
What helps me the most is I explain to the client that he will be able to find a lower price but never a better completed and professional job. I always explain you get what you pay for in the landscaping industry. In your case I would of asked to take a look at the other proposals to make sure he was compairing apples to apples.

Isobel
06-28-2009, 06:18 PM
yea i did that too, granted this was over email. But didn't get a response back.

I know that he may have just been price shopping, which means all of my explaining will not do anything to change his mind.

Its just discouraging.

AGLA
06-28-2009, 09:02 PM
Some people will rather have a half a$$ job if it is cheaper. As long as you can find those that will pay, there is no sense worrying about it.

You are not going to get them to pay your price and they won't get you to do it for their price. Why worry about it. It has always been that way.

Isobel
06-28-2009, 09:11 PM
yep i know. like I said it just seems frustrating sometimes.

Lite4
06-29-2009, 11:39 AM
I just lost a client, had estimated a job for some new landscaping, pruning the existing property, mulch, some lawn repair, came out on the order of 5k. Some other landscaper said he'd do everything for 2500. wtf?
I don't understand how anyone makes money doing stuff like that.

oh well.

Dont' worry about guys like that. When the customer realizes they are getting exactly what they are paying for, they will call you to come fix all the crap the other guy screwed up.

Guys like this don't understand how to operate a long term business and he will probably go by the wayside very soon.

What is important is that you stay in front of this customer regularly so that when things do go bad you are there to pick up the pieces. Do you have them on a mailing list? Send out a monthly newsletter about new topics that are industry related. Do a project focus with some new clients to show before and afters of what you have done to bring a property up. Just stay in front of these people and you may get them back soon.