Neighborhood Pricing? - Am I crazy thinking this would work?
I have been lurking on this forum for the past several weeks in the interest of possibly starting a sealcoating business in the future. Most of the information on this site has been very valuable; thank you all.
One of the biggest problem it seems that a lot of the sealcoating companies in my area have is marketing. Sales is what I do for my full-time job so I have been thinking on how a sealcoating company could do it better. I keep coming back to the idea of offering volume discounts for the more people in your neighborhood who sign up to get your driveway done. Some companies in my area do this now, but typically only offer $5 off if you get it done with a neighbor. I want to state up front that my operation would be quality work, using quality product. Not a fly-by-night operation using sub-par product and application techniques.
Take the standard driveway in my area (2x2 cars). Having a crew of 2-3 people for one driveway may seem like overkill but think about the time they could get a quality job done when working together (i.e. first guy clearing, cleaning driveway, second guy begins filling cracks, 3rd guy begins spraying edges). Obviously all of this work would be slightly behind the previous person. First guy finishes and then moves on to the next-door neighbor (or someone a few houses down). This leads into my idea of neighborhood pricing.
For example, if your standard charge for a driveway is going to be $200 for sealcoating only (keep in mind, I haven't done all the math on this yet, but I am just using that as a nice round figure). Then you offer the following discounts:
-$185/driveway ($15 off) if 5 people in your neighborhood sign up
-$170/driveway ($30 off if 10 people in your neighborhood sign up
- $150/driveway ($50 off) if 20 people in your neighborhood sigm up
Obviously, the idea here is that you are eliminating the non-revenue activity of driving from job-to-job. In the vast suburban area I live in, this could easily be 15-30 minutes between jobs. Also, if you do a great job, which would be the goal, you would have a huge repeat business that would only to continue to saturate neighborhoods every few years. With a lot of neighborhoods creating groups on Facebook and using sites like Nextdoor it could really spread a lot faster in a neighborhood than traditional marketing. Not to mention, taking this concept to homeowner's associations and really seeing some large numbers.
So am I crazy? Could this work? You guys are the experts, please let me know your thoughts.