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a900

  • Posts: 511
Increasing prices on cheap work
« on: August 23, 2009, 07:58:25 am »
Hi,

I just brought a small round about a days work. The people seem nice and most of the houses are all on one street.

I have one problem tho. The prices are to cheap. They are all 3 bed semis and most of them are priced at £6-£8. The going rate here is around £12-£14.

My question is how is the best way to increase the prices to what they should be?

andyjm1

  • Posts: 430
Re: Increasing prices on cheap work
« Reply #1 on: August 23, 2009, 08:21:26 am »
Just tell 'em. You will proably lose some, but still unless you are prepared to work for crap money what choice do you have?

Londoner

Re: Increasing prices on cheap work
« Reply #2 on: August 23, 2009, 08:23:49 am »
Thats the big problem, the prices are half the going rate and how many customers are going to be OK with you doubling the prices?

They will accept a 10% or even a 25% increase but thats as far as most will go. I would be interested to know what other people think. I would suggest putting all of them up to £10 straight away. Then leave it a while. As they are all in the same street you can get round then quickly so you should still earn out of them.

stephen s

Re: Increasing prices on cheap work
« Reply #3 on: August 23, 2009, 08:44:59 am »
I would tread very carefully mate,  there are a lot of newbies out there canvassing and if you try to put the prices up to people who don't even know you yet and someone canvasses that street you could end up with a lot of losses.

the alarm bells should have been ringing before you bought the round and knew what the prices were then,  why was the last w/c charging so cheap ? 

as suggested you could try a 10 or even 20% increase but personally I would get to know the customers first and build up a good working relationship with them before I tried to increase prices. 

Re: Increasing prices on cheap work
« Reply #4 on: August 23, 2009, 08:45:40 am »
Why buy the round in the first place.Surely you looked at the work first before you parted with your hard earned money?....
If you are stuck with it now i would do them for a couple of months first but warn them that their prices will increase ,that way they at least know you and trust you by then.

TonyD

  • Posts: 331
Re: Increasing prices on cheap work
« Reply #5 on: August 23, 2009, 11:42:56 am »
As with a few of the other posts, I'd build a relationship with the customers first to build trust that you're doing a good job and a quality set up.

MSTAV

  • Posts: 366
Re: Increasing prices on cheap work
« Reply #6 on: August 23, 2009, 12:31:22 pm »
not the best of times to be putting customer prices up. I had this a while ago and lost 4 out of the 21 i put up by £2.00. id do it graduly mate if i was you

windowswashed

  • Posts: 2626
Re: Increasing prices on cheap work
« Reply #7 on: August 23, 2009, 12:55:37 pm »
Shouldn't have bought the work if prices were ridiculously low because you'll end up losing most of them if you increase to good prices. You'll regret putting them up small amounts over a long period of time just to lose them eventually when prices match your existing round. Me personally, I would increase them mid way and increase prices bi-annually.

aiminvestor

  • Posts: 139
Re: Increasing prices on cheap work
« Reply #8 on: August 24, 2009, 09:20:42 am »
Thats the big problem, the prices are half the going rate and how many customers are going to be OK with you doubling the prices?

They will accept a 10% or even a 25% increase but thats as far as most will go. I would be interested to know what other people think. I would suggest putting all of them up to £10 straight away. Then leave it a while. As they are all in the same street you can get round then quickly so you should still earn out of them.


I agree, I would go to £10 minimum, and if you lose a couple, at the very least you will still earn more money for less work!
Dictum meum pactum

a900

  • Posts: 511
Re: Increasing prices on cheap work
« Reply #9 on: August 24, 2009, 09:47:26 am »
Why did i by the round?

Well i really need more work so this is an extra long days work every 5 weeks and  i brought the round based on its monthly income which is lower now so not to much cost. As aposed to purchasing work that costs much more becasue it has a higher income.

I brought with a view to having a round that will earn me good money will not costing me much to purchase. So say in a years time if i had my prices on the round i will be doing ok.

I dont know if i have made any sence.

stephen s

Re: Increasing prices on cheap work
« Reply #10 on: August 24, 2009, 10:27:50 am »
you haven't  ???

Platinum NW

  • Posts: 294
Re: Increasing prices on cheap work
« Reply #11 on: August 24, 2009, 10:37:01 am »
didnt get much of it lol I kind of see what your saying tho - you wanted to purchase work at a cheap price i think............

like stephen said you are more vunerable now that no-one knows you and with the newbies you could stuggle keeping hold of customers as they will be looking to save money in the long run............

If the work is monthly say turning over £100 thats £100 a month so you could change that to fortnightly so your £100 per clean would become £200 per month thus doubling your monthly turnoer

Smudger

  • Posts: 13459
Re: Increasing prices on cheap work
« Reply #12 on: August 24, 2009, 12:10:54 pm »
I would not increase the price for the 1st clean - let the custy's see your work, then on the second clean go for a small rise to £9  - £9.50 ( hitting them with tenner can make people think twice ) which will start on clean 3   -  then go for the next rise May of next year.

softly softly catchy monkee


Darran
Never argue with an idiot, they will only bring you down to their level, and beat you with experience

SteveAllan

Re: Increasing prices on cheap work
« Reply #13 on: August 24, 2009, 12:44:06 pm »
£12-£14 for a 3 bed semi :o not even Dick Turpin was that harsh ;D £7 to £9 round my way for them. What ya have to be careful of are the £3.50 newbies that will appear as they do undercutting you, you'll be a new face as will they and people being people will go with the cheaper guy, especially in current climate.

Smudger

  • Posts: 13459
Re: Increasing prices on cheap work
« Reply #14 on: August 24, 2009, 02:25:05 pm »
£12 - £ 14 is good price,

Around here (Norfolk)  the average is about £8.00 

but i have come across people who say they only pay £5.00 with current guy and had a 3 bed bungalow tell me she paid £3.50!!

6 large windows front door and patio doors!

Never argue with an idiot, they will only bring you down to their level, and beat you with experience

simon knight

Re: Increasing prices on cheap work
« Reply #15 on: August 24, 2009, 02:38:15 pm »

A 3 bed semi here in SW London is £10 with me. Takes me 20 minutes if I'm in lazy mode.

Get a row of them and you're on £30ph....nowt wrong with that in my book!

£14?...my customers would laugh in my face ::)

Re: Increasing prices on cheap work
« Reply #16 on: August 24, 2009, 05:00:04 pm »
I've been Window Cleaning since 1991 and have been given a few underpriced rounds in my time. Ones where the previous cleaner has done them for too long for next to nothing. I have tried all methods to get up to the right price. By far the best way is to be honest, tell them what the price should be and why the previous cleaner prob wanted rid. Then give them the actual price it should be. If that is £12 so be it.

Whatever you do don't think that you can put them up £2 per year for the next 3 years. Both you and the customer will be frustrated, you because for 5 years you are not being paid properly. Them because every year you put the price up. The problem with this is that you will be putting them up 3 times by a high %. They will ask why, if you are happy to work the first year for £2 more, you need to keep increacing by £2.

I have had less problems doubling the price, explaining that they were not correctly priced, than trying to creep the price up  over time.

Plus if you get a new customer, do you keep it at the same as her neighbour or do you give her the correct price. As neighbours talk, if the prices are different, it takes some justifying.

In conclusion, be honest with the customer about how much it should be and charge accordingly.

simon knight

Re: Increasing prices on cheap work
« Reply #17 on: August 24, 2009, 05:47:17 pm »
I've been Window Cleaning since 1991 and have been given a few underpriced rounds in my time. Ones where the previous cleaner has done them for too long for next to nothing. I have tried all methods to get up to the right price. By far the best way is to be honest, tell them what the price should be and why the previous cleaner prob wanted rid. Then give them the actual price it should be. If that is £12 so be it.

Whatever you do don't think that you can put them up £2 per year for the next 3 years. Both you and the customer will be frustrated, you because for 5 years you are not being paid properly. Them because every year you put the price up. The problem with this is that you will be putting them up 3 times by a high %. They will ask why, if you are happy to work the first year for £2 more, you need to keep increacing by £2.

I have had less problems doubling the price, explaining that they were not correctly priced, than trying to creep the price up  over time.

Plus if you get a new customer, do you keep it at the same as her neighbour or do you give her the correct price. As neighbours talk, if the prices are different, it takes some justifying.

In conclusion, be honest with the customer about how much it should be and charge accordingly.

Top-notch advice.

a900

  • Posts: 511
Re: Increasing prices on cheap work
« Reply #18 on: August 24, 2009, 10:34:16 pm »
Thanks for the advise guys. SunshineCleaning i have to agree that your advise is top notch and i think that is the way i will go.

I will build a relationship with the customers over the next few months and then be honest with them and increase the prices. I have already decided that new customers will be on the todays prices.

I know that the round has not had a price increase since it was started 5 years ago so i can explain that costs for running a business have gone up in those years.

amayze

  • Posts: 341
Re: Increasing prices on cheap work
« Reply #19 on: August 24, 2009, 10:56:59 pm »
You could always say that the previous guy sold the round because he wasn't making any money from it, and that's partly because of the pricing.