Thread: Price beating & Discounts

I was reading through some arb. mags & noticed most the suppliers for our trade state; "they wont be undersold", "we`ll match anybodies price", "we`ll beat the competition by 10%" & so on.......


Funny how when we shop, we look for deals!! when the home owner shops & goes with the guy who uses these slogans he`s a "hack" or is he? I dont usually ####er on my pricing it is what it is!! But if a repeat customer gets another bid that beats me my $25-$50 then Ill match it, better to match than to loose it, or is it? I usually ask why they entertained other bids & if I had done something to upset them, the reply usually is; Nope just curious & shopping around a little.

What do ya think, is this what its coming too? match or beat incentives that will no doubt lower profitability!! or is this just a newbie faze? to get work, cause I see it all the time & often just plain cant or wont match the price they were given!!

Heres a nice one, I bid a job the other day, $860.00 the HO tells me he got a bid for $450.00.......after closing my jaw, I said from who? He tells me....happens to be a good friend of mine & I know he wouldnt bid this thing for that, having his # on speed dial I call em up in front of the guy & ask him if he`s nuts........He never bid the job!!! the invoice the HO used he made & just randomly selected a tree svc. My buddies..LOL We`ll now my buddies a little upset.....SOooo he shows up & we talk to the guy, He admitted he couldnt afford the going price & was trying to get services to match or beat the $450.00 cause thats all he could afford!!!

So be careful on those match or beat bids......they might be home made!!

LXT...................

Originally Posted by lxt

I was reading through some arb. mags & noticed most the suppliers for our trade state; "they wont be undersold", "we`ll match anybodies price", "we`ll beat the competition by 10%" & so on.......


Funny how when we shop, we look for deals!! when the home owner shops & goes with the guy who uses these slogans he`s a "hack" or is he? I dont usually ####er on my pricing it is what it is!! But if a repeat customer gets another bid that beats me my $25-$50 then Ill match it, better to match than to loose it, or is it? I usually ask why they entertained other bids & if I had done something to upset them, the reply usually is; Nope just curious & shopping around a little.

What do ya think, is this what its coming too? match or beat incentives that will no doubt lower profitability!! or is this just a newbie faze? to get work, cause I see it all the time & often just plain cant or wont match the price they were given!!

Heres a nice one, I bid a job the other day, $860.00 the HO tells me he got a bid for $450.00.......after closing my jaw, I said from who? He tells me....happens to be a good friend of mine & I know he wouldnt bid this thing for that, having his # on speed dial I call em up in front of the guy & ask him if he`s nuts........He never bid the job!!! the invoice the HO used he made & just randomly selected a tree svc. My buddies..LOL We`ll now my buddies a little upset.....SOooo he shows up & we talk to the guy, He admitted he couldnt afford the going price & was trying to get services to match or beat the $450.00 cause thats all he could afford!!!

So be careful on those match or beat bids......they might be home made!!

LXT...................

I feel you cant compare retail to services. Retail is an item at a set price. Services always differ in price. If you have a HUGE Oak out front, I am sure that a fresh climber starting out would charge WAY less than a guy who is in the biz ten years and has insurance.

There are too many variables in pricing for a service. the biggest one is in who's doing the service.

Example.

I collect Tattoos (lol) I can bring the custom image to whoever I want. i can walk into a shop that ONLY does walk-ins and most of their work is numbered on the wall. Each number coincides with a price. Say the Tattoo I want is a 2 hour job by this guy, and will be about $200. I KNOW that if I go to my favorite Artist in Boston (voted Best of Boston for 3 years!) he is going to do it right, the color will last, their will be no scarring, and I will also pay almost double, or around $400. Now if I was very serious about getting this work done by the best I would go see Horiyoshi III in Japan. I would get it done by him using traditional Japanese hand poking techniques, and the price would be upward of $1000.

Services are different when it comes to pricing. It depends on the co./person that does the work.

This isn't always the case with tree work as some jobs are very straight forward and anyone could do cheap. Like a Dogwood removal in a front yard next to the road with NO obstacles to drag the refuse to the chipper.

Crane work though is just like my statement above, except the times usually go down with a more experienced crew, better equipment, but this is an area where low bidder isn't always best.

OK rant over, I hope everyone is thoroughly confused after reading THAT!

Cool story--good on you to call the guy and get the facts straight!

My favorite way to avoid getting beat down on price is to offer something extra n/c, to up the value. If they like birds, install a birdhouse. Or plant flowering shrubs, if that's what they will like.

Long after the results of the tree work are forgotten, a butterfly bush will be appreciated, and remind them of you!

Of course the best way to compete is to do higher quality work; tree preservation instead of tree removal, for instance.

In the end, if all they care about is the cheapest way to get rid of a tree, I leave em be.

My wife showed me a rag called the Savy Shopper the other day. It's a little mag full of coupons, mostly for restaurants.
There were 2 tree companies advertised in it. Both were big companies, employing mostly hispanic workers.
They both advertised they would meet or beat any competitor's price and had 50, 100, and 250 off coupons you could use.

I've always thought the meet or beat thing was a hack alert.
Personally I don't drop my price , once I give it. No matter what.

I've lost quite a few jobs because of a 50 dollar or so difference , over the years, but not moving on the price was something I started out with.
And I think it's made me more money over the years than it's lost me.

in the winter when the competition is lower, you must adjust to market change or you will be sitting at home. I adjust prices according to the current market and have discounted on occasion even in non-winter months. If I was qouting my spring pricing in February I would not be working 5-6 days a week year round. I have also been higher on many occasions and still get the job. I bid a job last Friday, $2500, the guy had two other bids. I was $700 over the next highest bidder. The guy looked me in the eyes and told me I don't care what you are going to charge me you are getting the job. Reason being I am able to provide a service not equal to the other bids. This is just an example of price does not always matter. To some it is the only concern.

It is a tough call. I try to give the lowest price I can and still make money. If I am pricing to what other guys are doing then I am not doing anyone any good. I do not want to fall into the trap of trying to be the lowest price. I also use that in my marketing when I meet with a potential customer. I tell them I am not going to the lowest price but here is what I offer over the competition. I believe it gets me many jobs in which someone has a lower bid. I sell our strengths and highlight why others are cheaper.

With so many uninsured, unlicensed people working tree work it is probably impossible to compete on price alone. Someone will always beat a price, so price the best you can, sell the advantages you offer and move on. I have learned through the years that there is always another customer willing to pay for service and to walk away from those that will not. Good call on checking the price, I would have loved to see the look on that potentials face as you called his buff. Priceless

"Heres a nice one, I bid a job the other day, $860.00 the HO tells me he got a bid for $450.00.......after closing my jaw, I said from who? He tells me....happens to be a good friend of mine & I know he wouldnt bid this thing for that, having his # on speed dial I call em up in front of the guy & ask him if he`s nuts........He never bid the job!!! the invoice the HO used he made & just randomly selected a tree svc. My buddies..LOL We`ll now my buddies a little upset.....SOooo he shows up & we talk to the guy, He admitted he couldnt afford the going price & was trying to get services to match or beat the $450.00 cause thats all he could afford!!!

So be careful on those match or beat bids......they might be home made!!"

GOOD CALL ON CALLING YOUR BUD! WE DO BIS UNDER 3 DIFF NAMES AND IT'S VERY FUNNY WHEN THEY ASK IF WE CAN BEET XYZ'S PRICE AND IT'S THE NAME OF ONE OF OUR OTHER CO. AND WE HAVE NOT GIVEN THEM A BID! AND THIS HAPPENS MORE THEN ONE WOULD THINK

We used to use a "meet or beat" method with equivalent credentials, but it didn't make a significant difference. The folks who call you on that don't care about the quality of work, just the cheapest price.

Now I end up suggesting that the customer get another bid to compare mine to if there is a question of price. Sometimes they are taken back by such an approach, but I just use it reinforce that I'm more about providing good customer service than only making money. Just two weeks ago I bid a large oak for $2400 that another reputable competitor bid for $1800. The difference was they would have dropped most of it and "left the big wood for firewood," I was going to use a crane. When we leave the yard won't be destroyed and everything will be gone. Most folks don't realize how difficult it is to handle 4 ft. diameter wood.

The customer doesn't have $2400, so I suggested they call another company that has their own crane. The market is slow around here, so maybe the HO will get a break. I can't see doing the tree any cheaper than that, so if I get it they'll probably have to borrow the money. It's a hard way to be, but the tree has been struck by lightning and is no longer safe.

The look on his face was priceless, my buddy showing up & asking to see the bid he never gave was even better, the guy was kinda teary eyed so we talked a bit, My bud wasnt happy with the use of his biz name being used like this though!! the home owner was a decent person other than this stunt!!

I left before all was said & done my bud told me the guy was gonna wait till he could afford it & would do it the right way next time.........we`ll see!!

the real point of this thread was to contrast the "hack" threads so to speak, I see some of the big co.`s giving discounts & saying "get another bid in writing cheaper than ours & we`ll knock 10%" type things!! Im just wondering if there is a point between haggling & the low baller hack deals?

Ive always been kinda firm in my pricing, Im just wandering if loosing a job over $50 is worth it? Now a $100.00 they can kiss my @$$.




LXT..........

Originally Posted by lxt

The look on his face was priceless, my buddy showing up & asking to see the bid he never gave was even better, the guy was kinda teary eyed so we talked a bit, My bud wasnt happy with the use of his biz name being used like this though!! the home owner was a decent person other than this stunt!!

I left before all was said & done my bud told me the guy was gonna wait till he could afford it & would do it the right way next time.........we`ll see!!

the real point of this thread was to contrast the "hack" threads so to speak, I see some of the big co.`s giving discounts & saying "get another bid in writing cheaper than ours & we`ll knock 10%" type things!! Im just wondering if there is a point between haggling & the low baller hack deals?

Ive always been kinda firm in my pricing, Im just wandering if loosing a job over $50 is worth it? Now a $100.00 they can kiss my @$$.




LXT..........

I have lost jobs over $5.00, yes. $5.00 .What we bid is what we get.

Originally Posted by mckeetree

I have lost jobs over $5.00, yes. $5.00 .What we bid is what we get.

Wow!! in my area they`d hire you, then throw garbage in your dump & line up the debris from the hedges they trimmed last year..........their thought is they`ll get $5 more worth of work outta ya!! So you dont budge at all ? If not I gotta respect ya for stayin firm on your bid!!!

I dont know......not dropping $5 & on a $500, $600 or $800.00 job in my area will leave you sitting at home......alot!!

LXT..............

Wow, $5 ! I usually loose bids by several hundred to uninsured hacks. i hope it doesn't get that competative around here!

If you have the work to turn down $5 bucks...I usually have enough profit in my bit to have some flexibility, unless I'm in a blue collar neighborhood and and am bidding tight on purpose.

I've beat $10 on a number of occasions, though I'm usually way over when I bid. It is usually removals where the competition has a squad of cheap labor to haul firewood to the curb, so they bid near half what I want for nasty willows and box elders. I have not seen a huge tree that I "wanted" to remove for a number of years. The challenge effect has left me long ago, so I bid high and walk away.