PDA

View Full Version : Charging for estimates


Steve
03-13-2006, 11:41 AM
A question came in if an LCO should charge for estimates. Either $5 or $10.00 to cover gas. Then if the customer goes with you, they will be credited in their first bill.

Here is my view, please if anyone else has ideas, respond as well.

I think you shouldn't charge for estimates because the estimate is your chance to sell your services. A potential customer is going to want a few estimates and if the others are free, they will go with the other LCOs. If you can't get to the point of selling your services, you are dead in the water.

In fact, it would be wild if you would tell the customer you will pay them to give them an estimate which would be credited on their first service.

What are your thoughts?

mowboy
03-13-2006, 12:46 PM
Hey Team Gopher,

I could not agree more. I think it would be a mistake to charge for estimates and you would probably find that you don't get as many estimates... which means less opportunities to sell your services. Onsite visits are your chance to impress prospective customers and win their business which over the years can add up to a lot. As well, you can upsell additional services while you are there. I say ... get every estimate you can!

Great idea Team Gopher! Paying customers for a estimate will definitely set you apart from the pack.

tiedeman
03-13-2006, 02:02 PM
I have never thought about paying customers for estimates before. That would be wild. But do you think that you would get the reputation then of paying out customers and so customers would call you up all the time for estimates just to get some money?

The only reason that I brought up about charging for an estimate is really to cover for gas and your time. No, I personally do not agree with charging for estimates because then you are losing out on a lot of customers, but let's say that you do around 100 estimates a year, and land 50 of them. Then you have those other 50 estimates that you just wasted work time and gas money on.

Let's say for example, each estimate was 5 miles away (the average of most of my estimates), and the price of gas is at $3.00 a gallon. So one estmate would be equal to 10 miles of driving (to and from customer). If you get 20 miles to a gallon on your vehicle, then you are paying out approx $1.50 in gas for each estimate that you give.

My cost of business per hour during the day, these are total hours, even non-working, is at $2.75. Let's say an estimate normally takes 30 mins (these are for mostly just maintenance estimates), then the cost of each estimate would be $1.38.

So the total cost for each estimate would be $2.88 at 50 customers would be $144 dollars wasted.

Now, I was just figuring the total hrs (working and non working hours). Let's figure in your cost of working per hr. My cost of working per hour last year was $14.19. Now go again with the 30 min estimates which would make the cost of $7.10 for each customer.

We will still use the $1.50 in gas for each customer and add that with the working per hr cost of $7.10 gives you a total of $8.60 for each estimate, and at 50 estimates that is $430 lost.

Steve
03-13-2006, 03:01 PM
Hi tiedeman,

Quote[/b] ]But do you think that you would get the reputation then of paying out customers and so customers would call you up all the time for estimates just to get some money?
Well the concept behind this would be to pay them by way of crediting their invoice a certain fee if they accepted the job proposal.

tiedeman
03-13-2006, 03:19 PM
ahhh, I understand now.

How would you go about marketing that without sounding desperate? I actually like the idea.

Example Maybe:
We Pay your for an Estimate
Let us provide you with a 15 point walkthrough analysis of your lawn with prices for a complete fertilization package. If you sign up for services, you will receive a $10 credit towards your first invoice just for getting an estimate done.


Just somthing off from the top of my head

Steve
03-13-2006, 04:24 PM
Hi tiedeman,

How about this. Get a picture of you standing on a lawn with your spreader or something and point at the camera.

"I want your lawn." At the top.
"To have that healthy, thick and lush 'Tiedeman Lawn Look.'"
"I am so sure I can make improve the look of your lawn I will even pay you if you call me for an estimate.*"

Then at the bottom you can say "*Tiedeman Lawns will credit your account $x.00 for your initial service when you sign up, as a thank you for doing business with us."

Or something similar....
You could use this idea to build up the Tiedeman Lawn brand.

tiedeman
03-13-2006, 06:42 PM
I like that tag line

I still have to get you guys some pictures here hopefully this week