Your Pricing Mindset (Part 2)

You’re a tradie, price is a big deal.

You face constant everyday pressure on your thoughts about price.

Always downward pressure unless you’re talking to me.

You’re afraid of being too expensive when you explain your sales and margins or when you quote a job.

You’re afraid of being called out for being too expensive, getting it wrong, being the guy who doesn’t understand how your industry works or how business works.

(You’re afraid of being too cheap as well but for different reasons and similar reasons.)

You’re afraid of being called greedy.

You’re afraid of losing a job or losing a client.

You might have a mindset of, “Other people will be cheaper, I’d better try to make sure I’m not over.”

Or, “The client said how the budget is $x but I’m coming in way over that. I’d better try to get closer.”

Maybe you’re not confident that your rates and margins are fair or that your estimating is good and accurate.

Assess yourselfwhat’s your mindset or pricing? Is it holding you back?

You need to charge enough. 

I’m not suggesting you get greedy but your business needs to make enough to cover the costs of labour and materials and subcontractors (if you have them)

AND to cover all the overheads and risks of your business – which increase as you grow and accumulate things like vehicles and premises and admin staff and estimators. 

AND make you some profit on top of your wage.

That’s reasonable.

Another thing – your customer will cry poor – that’s why (or partly) you might feel like it’s up to you to help them get what they want for the budget they gave you (even though that could be completely unreasonable).

It’s not your job. They’re not poor people you need to help. They’re almost always people wealthy enough to improve their properties or businesses trying to improve their profits or landlords maintaining their properties.

Your work is making them richer.

Your job (pricing-wise) is to price fairly and look after your property – your business.

The point to remember when you’re thinking about your mindset around pricing is that price only makes up about ⅓ of people’s (or business’s) decision criteria when buying something – other factors are also important.

Price is important, I’m not trying to suggest it isn’t.

But all trades businesses are not the same. They don’t deliver the same outcomes. They don’t merit the same level of trust or build the same relationship.

So think of price in the context of all that when you’re preparing and presenting your price. 

If you only focus on price, you’re not helping your customers understand some other stuff that they need which means maybe they’ll guess or assume or maybe your competitor is telling them that.

Also, remember, that the price operates in a context. Your price includes the details of your solution, and your reputation, your relationship, the trust, and convenience risk.

Consider it and present it as such.

So shift your pricing mindset from those old fear-based, uncertain ones about the need to be cheap to:

  • Confident ones based on understanding your costs and margins properly and your estimating and operational delivery.
  • Confident ones based on understanding your competition and how you compare.
  • Confident that your pricing is fair.
  • Confident that your customers are not poor and in need of your support but well-off and getting more well-off as a result of your work. That cry of poor is bulls#!t.

You’ll need to work (won’t you?) – do the work to help you be confident (coaching will help – get in touch and book a call).

There are four ways you can engage with me:

1. Subscribe to these emails and get them once a week in your inbox so you never miss a video from me.

2. Join the Trades Business Toolshed Facebook Group where you can watch these videos, ask me questions or talk to your peers.

3. Attend my next Tradie Profit Webinar.

4. Book yourself a 10-minute chat with me. We’ll talk about whether coaching is right for you now and if it is, we’ll go further into the process before you have to make your mind up.

See you later.

Click here to book a money maker call with Jon.