Register free!

Reply
 
Thread Tools   Display Modes
  #1  
Old 04-08-2015, 01:58 AM
Chris J Chris J is offline
LawnSite Silver Member
 
Join Date: Sep 2006
Location: Maldive Islands
Posts: 2,317
Design Consultation Fee.. Do you get paid for this?

Several years ago, my friend Mike Gambino and I were discussing when, and if, one should or should not charge a fee for an initial meeting or consultation. Of course we disagreed (I think we disagree on everything on purpose sometimes ;-) but we both had very good points in the argument and I'd like to get some feedback and opinions.
If you have ever visited Mike's website, GambinoLighting.com, you will see that he is very clear about his expectations and thoroughly explains what the potential client should expect in return. His website is extremely well done, and I think the answer to my question has a lot to do with how well you have prepared the potential client and qualified yourself as a professional before they contact you. On the other hand, and this is my opinion and argument, when prospects are seeking a contractor via web searches they will not stop looking once they find one phone number. Instead, they will probably call multiple contractors and seek multiple bids. In my territory, there are a multitude of companies that install landscape lighting but none of them charge a consultation fee for the initial meeting. When I tested the market to see what would happen if I asked for a fee, I found out very quickly that most people would skip right by me and not even give me a shot. That is, unless they came by referral, but even then they would be "put off" if they had contacted some of the other companies willing to do it for free; therefore, I rejected the idea before I went broke.
A lot of companies around here even offer free night demonstrations....... and I think that is ridiculous, by the way, but it sells jobs. I don't do night time demonstrations anymore because I have so many clients scattered across the area that I can usually stand in someone's front yard and point to various clients that we already have in their neighborhood. When I first started my business, I had the time to do demonstrations because I was only getting 2-4 requests per week; therefore, I could do the demos but it eventually cost me a divorce due to the fact that I worked from 5am till 11pm (during summer months). As I became more well known, I decided that I could do 3-5 consultations per day, resulting in a whole lot more sales calls within the week...... I mean let's face it; I can only do one demo per night, and there are only 7 days in a week. Even though the closing rate was higher with a demo, the end result was more jobs simply because of the number of potential clients that I was getting in front of.

Having said this, what do you do? Can you get a fee for initial consultations? Do you think you lose potential clients because of it? What about demos? Do you do them? Do you charge for that service?

Just curious what works in other parts of the country. I'm sure that some of you will have some very interesting views on this topic.
Reply With Quote
  #2  
Old 04-08-2015, 04:53 AM
easy-lift guy's Avatar
easy-lift guy easy-lift guy is offline
LawnSite Silver Member
 
Join Date: Aug 2011
Location: Venice, FL. USA
Posts: 2,501
Although I cannot address the lighting industry per say keeping your presentation time as short as possible is critical. With existing technology available having examples of ones work and pricing options should be a simple presentation matter by way of tablet or lap top. In the past I have offered a discount of the overall price of said job I prepared design work for. I made sure that the customer understood this offer and that my design work was copyrighted and could not be used in any way without my permission in writing.
Once the customer was made aware of this fact usually the business of selling the job going forward was a formality and the job secured. Only had two cases where the customer decided to ignore the rules and pay the price for their decision. I never did work for the two customers in the future, however they ultimately payed for the design work since they did not want to loose in court.
easy-lift guy
Reply With Quote
  #3  
Old 04-08-2015, 08:58 AM
steveparrott steveparrott is offline
Sponsor
 
Join Date: Jun 2005
Location: Tampa, FL
Posts: 1,012
Good topic. There are several considerations here and (I suggest) some business truisms.

I like Chris's approach of testing the market, watching the competition, and being flexible in his approach. The best approach is the one that works.

What's worked in the past may not work any more. It would be interesting to read local online reviews about businesses who charge the initial consult fee and those who don't. People are smart; if the "free consult" guys get comparable reviews to the "paid consult" guys then it's a hard sell to charge for a consult (unless you're talking very large jobs).

If you do charge for a consult, then the consult needs to stand alone as a service. It needs to have definite value to the customer - and some defined deliverables (such as drawings, photos, take-outs, etc.). To justify the design fee, it would probably involve hours of work - and the skill to produce those pieces.

If you charge a design fee, then you may or may not get the installation job. If you give free consults (or a promise to take the design fee out of the installation cost), then you more likely to get the profitable installation work. That's a calculation you need to do.

To my knowledge there are only a handful of residential landscape lighting designers who will insist on paid consultations for their work. A slightly bigger % will occasionally do paid consultations (especially for large complex projects or for jobs where they are only doing the design).

The great majority of landscape lighting businesses give free consults; I believe primarily because these in-person visits are the best opportunities to demonstrate their design skills (and sell their value - and passion) to prospective customers prior to signing a contract.
__________________
Steve Parrott
Communications Director
VOLT® Lighting

813.978.3700
stevep@voltlighting.com
www.voltlighting.com



Professional Quality at a Great Price
Reply With Quote
  #4  
Old 04-08-2015, 12:29 PM
Alan B Alan B is offline
Sponsor
 
Join Date: Jan 2008
Location: tampa, fl
Posts: 356
In my opinion:

1. Design-Build Co’s get a lot of business from referrals and in clusters with in certain neighborhoods and areas. So the key is breaking into new clusters.
2. The hardest part of growing is getting enough leads and prospects.
3. Once you have a face to face meeting the odds of closing are a lot higher than not getting to meet a prospective customer (obviously). Accordingly you should do everything to attract and encourage more potential clients to call you until you reach a point that you are too busy to serve those clients and consults. At that tipping point you can start being more selective by pre-qualifying them via phone to avoid the wasted trips on poor prospects. At that point if you are still too overwhelmed, I would consider hiring more staff.

The only time I think you could start charging a design fee is if you:

1. Are such a mature company that you are completely full and busy and
2. You have additional staff but dont want to grow so big that you are no longer intimately involved in each project, and you are still overwhelmed and
3. You've raised your rates to weed out the less profitable customers and yet you're still too busy.

If that is the case you owe yourself a big congratulations on doing a great job.

If you are in an area that can support high prices, you have a team, and yet you are overwhelmed with work, then you could start to consider charging a design fee. Personally I think it would be better to hire more people and do a better job of pre-screening on the phone. The goal is to get in front of as many qualified prospects as possible.

That said if you become the Harry Winston, the Vera Wang… the company that the rich and famous start calling just because of your well known reputation, and your service, results and reputation precede you (people know what you are all about BEFORE they call you), that is a different story. If that is the case then you can start charging consult fees.
__________________
Alan
President/CEO
VOLT® Lighting
(813) 978-3700
alanb@voltlighting.com
www.voltlighting.com


Factory Direct Outdoor Lighting
Reply With Quote
  #5  
Old 04-08-2015, 01:49 PM
kellanv kellanv is online now
LawnSite Member
 
Join Date: Feb 2014
Location: Austin, Texas
Posts: 152
So I come from a wider design/build background with quite a bit of lighting involved. We hit the same issues in the landscape design field as being discussed here - there are many companies that offer free design. For a small yard, OK, I get it. For a full property with HOA submittals etc. it is crazy to me that people value their time so little. Since we are never the cheapest bidder in a project, it is not sane for us to give out a free design and a mid to high construction bid and open ourselves up to have someone just steal it. 20 hours of my time should not be free. Luckily, we have a good reputation and many examples to help sell ourselves.

We don't charge for the initial consultation but we don't give them any sort of exact design, either. We stick to general ideas and descriptions and go from there.

That being said, lighting has been a little tougher. On the commercial projects I typically get paid for design due to the nature of the system being more complicated. On residential I've tested charging a consultation fee like plumbers/irrigators etc. and that didn't go very well as a general rule. As it stands now, I generally meet for free and on medium to small projects don't charge for design time if it will only take me a couple of hours. If it is a system renovation I charge to look everything over, take inventory, etc.
Reply With Quote
  #6  
Old 04-10-2015, 02:24 AM
Chris J Chris J is offline
LawnSite Silver Member
 
Join Date: Sep 2006
Location: Maldive Islands
Posts: 2,317
Excellent responses so far!!!!! And I agree with virtually everything that has been suggested. On design/build jobs involving multiple facets of work, ie landscape, hardscape, renovation, irrigation, lighting etc, I wouldn't expect anyone to provide a detailed plan of execution without a fee and the lighting portion of the total project could be easily buried within the total design fee for the proposal. When I provide estimates or quotes for a project, I never go into detail about photometrics, specific fixtures for each location, lamp/fixture type or even specific model numbers for products I will be using for the specific locations. Instead, I will initially provide a rough layout of the plan using generic symbols and designators that only I will understand. This plan gives me the information that I need to create a materials list when the job is secured, but does not reveal much about the specifics to the potential client. Most of our consultations do not require more than an hour of face to face presentation time. Depending on my level of comfort that the potential client is sincere and qualified, I will then prepare a proposal that I am comfortable with and it usually doesn't require to much more of my time to put together a plan and proposal to present to them. This certainly does not apply to very large estates, however, nor does it apply to leads that are a significant distance from my normal operating territory. In those instances, I will almost always explain that a fee will be required up front but will be credited on the final invoice if we are hired for the work.

Additionally, in his post above, Alan pretty much described my situation to a tee. However, and I'm not ashamed to admit it, the dilemma of pre-qualification by phone is perplexing to me (to an extent) and I'm absolutely not good at it, nor have I found a tactful way to do it. There are certainly areas of my territory that I recognize as lower percentage closing areas, but pre-qualifying by phone has always been a challenge. Years ago, I would attempt to explain the choices available to a consumer regarding quality lighting vs. DIY junk, and I would also provide "average" job costs to give them an idea of what to expect. I'm sure you can imagine my discomfort when I told someone that the average was 5k, yet when I arrived for the initial consult I was pulling into a multi-million dollar estate requiring a lighting package in the 10's of thousands. Yes, I'm good at a lot of things, but pre-qualification by phone is not one of them and I will gladly pay for any available training in that arena.

Good thread though. Let's hear more opinions on this topic!! This is the kind of topic where you can learn something extremely valuable from almost anyone, in any trade, and with any level of experience....... and I'm all ears (eyes)!!
Reply With Quote
  #7  
Old 04-10-2015, 10:23 AM
niteliters niteliters is offline
LawnSite Senior Member
 
Join Date: Feb 2006
Location: owensboro kentucky
Posts: 537
Our process is broken into 2 parts. The design consultation and the actual design/proposal process. No charge for consultation within certain radius. Charge design fee for our time to prepare design/proposal. Not to give them anything. Potential client is made aware that they are not buying anything, not getting anything, just paying for our time. Client made aware up front that money not credited back towards job. Pay as you go.
__________________
chris
A.O.L.P. member
C.O.L.D. (Certified Outdoor Lighting Designer)#1112
C.L.V.L.T. (Certified Low Voltage Lighting Technician)#0639
Reply With Quote
  #8  
Old 04-15-2015, 12:24 AM
Chris J Chris J is offline
LawnSite Silver Member
 
Join Date: Sep 2006
Location: Maldive Islands
Posts: 2,317
I think the best I've seen so far would have to be Paul Gosselin's process. If I'm not mistaken, his initial consultation is free but he then charges a design fee to put together a proposal and another meeting. Nothing special about this process except the presentation he returns with if his design fee is obtained. He puts together a very elaborate (I think power-point) presentation that is very detailed and even includes his resume. The last time I saw it was several years ago so it's probably even better these days.
Reply With Quote
Reply

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off

Forum Jump

Layout Style:






Powered by vBulletin® Version 3.8.6
Copyright ©2000 - 2015, Jelsoft Enterprises Ltd.
Copyright ©1998 - 2012, LawnSite.com™ - Moose River Media
All times are GMT -4. The time now is 03:18 AM.

Page generated in 0.07119 seconds with 9 queries