I put me first to ensure my success. I enjoy the work I do. I add value to my clients. I save them money, help them make money, and help them enjoy life by reducing their stress and helping them dream and reach their dreams.
They, in turn, give me their trust and some of their money.
However, like everyone else, I do get complaints about my charge out rates. You charge what per hour? That question got me to write a book on that topic for trade contractors. It’s available from my website.
How do you explain to someone about your fee structure? Whether it is a fixed price, an hourly rate, or a budget price you will often get resistance.
If you had a minor tax problem with the CRA maybe your bookkeeper or accountant can deal with it. If you have a major tax problem you will likely hire the best, and most likely expensive, accountant. Price becomes much less of an issue; however, if it is a simple issue I will be more price conscious. The same level of expertise is not required. The issue is more of a commodity. That’s why a agencies are set up to do personal taxes for low fees.
I don’t want to be a commodity and you shouldn’t either.
I focus on my clients by saying, “In order to put you first, I must put me first”. That gets their attention. As a contractor you need to get the correct message across.
I can’t provide you with the level of service I need to unless you pay me a price that allows me to cover my costs, take an appropriate remuneration for myself, and put something into my retirement fund. My costs do include reinvesting in my business so that I have the best expertise and equipment to serve you and meet your needs.
If I don’t stay in business I won’t be able to support you. If my price is too low, I may be tempted to cut corners and what good is that going to do you?
How are you going to deliver the appropriate outcome without doing good work? And it is when you deliver the desired outcome that you ask for a referral or a reference. Maybe it’s as simple as getting a great review on your website.
It reminds me of the Benjamin Franklin quote, “The bitterness of poor quality remains long after the sweetness of low price is forgotten.”
Sometimes, you will lose work because your price is too high, just like the expensive accountant who doesn’t get to prepare the simple tax returns. So, comfort yourself with the belief that they didn’t need your level of skill to help them resolve their issues or to provide them the support they need. Other times question yourself, not about your charge out rate but wonder if you have explained to them the value you bring to their specific situation.
Your prospects have only four choices.
1. Do nothing
2. Do it themselves
3. Hire someone else
4. Hire you
Do nothing? So, determine if they are going ahead with the work or not. If they are not, then bye, bye.
Do it yourself? Do they have the time? Do they have the in- house skills? Why haven’t they already done it? If they want DIY, again bye, bye.
At this stage they only have two choices.
Use you or someone else. This is where you espouse the values you bring. How you do work on time, on budget, and to the standard expected. Then say, “I get most of my work by referral. If I don’t get a referral from you I will feel I failed. I will work hard for you because not only are you my current pay cheque, you are the source for my next one.”
Then back this up with testimonial videos, letters, and emails and names of people for them to contact so they will know you are the right choice for them. I get testimonial videos on my mobile phone. Someone says something nice about my services and I whip out my phone and ask them to repeat it.
Assure them they will certainly find many people cheaper than you and then quote Benjamin Franklin. Give them a little card with the quote on it, so they will remember. Maybe that’s what is on the back of your business card.
Telling people about yourself is not going to get you the project. You need to link your statements back to the benefits the customer will receive. Tell your customers what outcomes they will receive by using your business. Describe your ability and expertise in meeting their needs in a timely manner and sticking to your budget: “Because of our X-year experience we have dealt with every problem imaginable in this industry, including the one you are facing now.”
Never run down your competition. Many of them do very good work. However, when you are a good fit for your client it is your obligation to ensure they retain your firm to look after their needs. If they make a mistake and go elsewhere ask yourself what you did wrong and it is not the price; it is the value that they didn’t understand. You need to ask yourself how you can get your value message across more effectively. That’s the script you need to work on. Make sure you include your willingness to deliver the required outcomes in a timely manner. Don’t over promise and under deliver.
You see, once you are my client I will put you first.
Your Plan of Action
- Brainstorm with your team the value you bring to your clients:
› On time
› On budget
› Meet the standards
› Retain their goodwill - Write out your value proposition and why the clients should choose you. Make sure in includes the above four points
- Make sure everyone in your business understand and buys into this culture
- Make sure it is on the home page of your website
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Ron Coleman helps make the ownership transition of trade and specialty contracting companies more successful. He ensures that businesses are attractive to buyers so that both seller and buyer enjoy a win-win situation.
His book Becoming Contractor of the Year will show you techniques you can use to make more money, have more fun, and make your business more saleable. His book Building Your Legacy has more than 40 great ideas for helping you work smarter, not harder, and create a legacy of which you can be very proud. Ron is a professional accountant, a certified management consultant, and a professional member of the Canadian Association of Professional Speakers.
Need a speaker for your next conference? Give Ron a call. Visit Ron at www.ronaldcoleman.ca and review his other publications and resource materials for contractors.
