So what`s the basic economics lesson?
You mean supply and demand? You went all around the houses for that didn`t you :
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And in a crude way too.
can someone clarify what the basic economic lesson is i.e. perfect windows what is your point? you typed a load on what you charge but what is your point and why is everyone else wrong, I am not disagreeing with you but I would like to know how you came up with your policy and what is the thinking behind it
No, it's not about supply and demand. It's about money left on the table.
I really do not believe that everyone else is wrong: I just gave an example of one person who was leaving money on the table. He's offering a service that isn't quite where I like to feel mine is, but he could (and I'm saying should) be charging more. My feel for his quality of service (utterly subjectively) is at about the £12-£15 range. Thus, I argue that he's leaving between £4.50 and £7.50 on the table. He could charge that and still get the house (IMHO). In terms of the posts to which I was responding, it's a common theme on here that you're in some way ripping off the customer if you charge high prices.
So, back to money left on the table. The way businesses are supposed to detect who is price sensitive is to offer lower prices and put an obstacle in front of saving money. Alternatively, add a small extra service at a high price to get cash out of those happy to pay.
As an example, Starbucks offer both of these. They sell a cheap coffee called a "Short". The obstacle they place in front of you is that it isn't on their price list. You need to know about it and ask for it. Up at the other end of the scale are coffee syrups whose cost price is effectively nil and that are charged to you at a huge premium. Thus they offer a solution for the person to whom money matters a lot and those to whom the price is largely irrelevant. Tesco's solution is to make "value" packaging look awful so that people who can will avoid it. That way, they get more money out of people who will pay not to look cheap.
So, how to prevent leaving money on the table? I consider my gold standard service to be a six-weekly wash, which for a standard semi is £16. So, allowing for four weeks a year of hols for me, that means 8 cleans so £16x8 = £128 a year. I get this amount out of someone who isn't price sensitive. Someone who is more keen on reducing their expenditure can ask me to come quarterly, at £24x4 = £96 a year. The obstacle for them is dirtier windows, so they need to want to save the money. For someone who is utterly dedicated to low price, I will offer twice a year at £32x2 = £64 a year. That isn't on my price list, so they need to request it: larger obstacle. It seems to do the job; I'm not cheap by any means, but most customers find a way to get what they are looking for from me, at much different prices.
No doubt you will think I'm overcomplicating it, but it goes some way towards resolving what's a complex issue.
Hope that clarifies what I was trying to say. "I just think a lot of people are undercharging" might be a good summary. I think I've found a partial solution, but I'm always looking for new ideas on how to get the most from my customers in a way that leaves us both smiling.
Vin