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I am producing a price list for quick estimating.
My problem is when I start to price multiples for example, if I'm fitting out two alcoves, I can justify 2 x standard tall open bookcases and 2 x installation charges totaling at £2124.00, this keeps me in the ball park.
To be clear, are you actually hearing the gasp from customers, or are you just anticipating this will be the case? There are certain situations that do allow for us to see at times, that our square foot prices seem high when quoting large jobs. I am talking shutters here, not cabinets, but still the same concept. Truthfully I find that since I am doing more work, at a fair rate based on single units, that I should welcome the opportunity to make some extra profit. I personally choose to stay with the higher prices. I lose a few, but I get the majority of them. If I feel it is a competitive situation, or there is some other reason I really do want the job, I do offer a small percentage discount. No formula for it, usually just some token discount I can live with, and still be happy with getting the order. Even then, I never use a conditional quick close comment to get an immediate commitment, preferring to allow the customer to decide in their own time frame.
Graham, I see your situation in the same way a lot of us approach quoting. How to minimize time up front during estimating and quoting, trying to get enough information to be accurate, but without giving a potential customer the feeling that we won't give them the time they deserve as a paying customer. I actually don't give estimates in window treatments, but I do occasionaly give estimates with closet systems. After going back and forth on the amount time I spend on drawings and pricing, showing accessories and answering questions, making those extra free trips, I finally just decided to do all these things, whatever time it takes. (All for no charge, long distances with travel are another matter.) And then by doing this, I am content with giving my higher prices to the client. I think many of my customers recognize my extra effort during this quoting phase, and weighs this into their consideration that my attention to detail will carry over into the actual making and delivery of product. Now many of my customers are prequalified and most are referrals, which means I am in a better position to do this than with a cold client. I still lose few, but when I give my quotes my best effort, somehow I can easily accept that this particular person was never going to be my customer anyway. Plus I think in the long run, I did myself a favor by helping that customer come to the conclusion they wouldn't be using our services any further. Off subject to get to this point, but when my prices seem high, even to me, the reality is after the job, those prices and earned profits were well deserved. I think the idea of a quick estimate as a time saver is great, as long as the quickness doesn't undermine your final quote. I have avoided estimating for the most part, as I tend to low ball an estimate to keep a customer interested, more a personality issue than a business decision. Then I eventually have to over come and justify any pricing that is higher as the project enters a final quote. Too many customers have an excellent ability to retain low numbers once they are presented, even after being given a more accurate and higher price later on.
Hi Mitch, I agree with what you say and indeed I produce a proposal which is a nice piece of work including high rendered images and detailed specification the client is in no doubt as to what they are getting, no fudges. I strongly believe I have been one off the most innovative business in my part of the world when it comes to delivering a proposal, and yes it does win jobs. The software I use not only does some of the highest renders in the industry, but makes it easy to draw and present, but within half a dozen clicks I have an optimised job ready for the saw, this used to take a lot of reworking in the past. This basically means if the client agrees I can hit the button and the job is ready for the shop floor.
My quick estimates are based on accurate actualls (jobs which I have timed and quantified)
Just to be clear about what you and your customer are understanding: A Quote is a fixed price that you will do the specified work for. An Estimate is a SWAG based on a loose set of information about what is wanted. The customer must understand the difference! When a customer insists on an estimate we always give a range and try to explain why there is a range. Lamborghini or Miada both nice cars but slightly different prices.
Hi Larry, thanks for your post.