Your Pricing Questions Hinge On This
Is my pricing right?
We’ve all been there at some point or another. Wondering whether our pricing is too high, too low, etc.
I literally just had a really cool conversation on this topic with 3 young guys who are just getting started in their business. I was in Cedar Rapids Iowa today for the Unilock Contractor Advantage seminar, where I did a talk. Afterward, we just bumped into each other in the hallway, and they stopped me and asked a question on how to work up pricing. I could see they were hungry, they struck me as the type to hustle and grind, and so we went from what I thought was going to be a 30-second conversation to a 40 min one right there in the hallway. Ha ha, I love how life does that.
Anyway, I quickly realized they were overlooking a few things, and greatly undercharging and undervaluing themselves, so I texted them a link to the free budgeting tool we have, and we started digging into how you can just plug all your expenses into the budget, and it spits your pricing back out. It’s:
- a beautiful thing.
- just takes all the emotion out of it.
- pure math. Plug your numbers in, and pull your pricing back out. 2+2 always equals 4. You can’t argue with it.
If you’re not happy with what it’s telling you, then there’s only one thing to do. Dive back in and fiddle with the numbers, reduce expenses, etc, until you get it where you want it.
Your pricing “floor”
Another cool thing about the budget is it shows you your pricing “floor”. You can’t charge less than what you’re budget tells you. But you can always charge more. Your market is your only ceiling. You haven’t hit the ceiling if you can still sell the job. (I’m just now realizing as I’m typing this that I literally said something like that a few weeks ago on my blog. Sorry for the repetitiveness 😜)
But that is the simple beauty of it. All your pricing questions hinge on your budget. If all your expenses are properly entered into your budget, then you have your answers. Is your man-hour price too high? What does your budget say? What should your markup be on materials? What does your budget say?
I am actually doing a live, in-person workshop for building budgets and estimating jobs in July with Landscape Ontario. I’m going to be sharing the 6 most common mistakes I see folks making in their budgets, then we’ll switch to work mode and build or update your own budget right there in our session. After that, we’ll talk about what it looks like when the rubber hits the road, and you apply your budget to your estimate.
If you’d like to come to that, just let me know and we’ll send you the registration details once we get them from Landscape Ontario. If you are within a few hour drive and do not have a current budget, take this as your sign to COME HANG OUT with me, and I’ll help you go home with a solid budget and clarity on what you need to charge
All you’ll need to do is bring your laptop or iPad and numbers with you, like what you’ve spent in your business over the past year. Aka a Profit & Loss statement. If you don’t have that, then take 10 min and go sign up for QuickBooks Online so you have a Profit & Loss for next year, and come anyway. 😜 We can fill in the blanks with some figuring and educated guessing projections.
Also, bring a job you’ve bid on recently. Once we finish building a budget, we’ll re-estimate that job to see where your pricing should have been. This is always super interesting and oftentimes eye-opening.
I know July is out a way, but do you think I should do a virtual one of these? Hit reply or comment on the blog and let me know.
If I get enough requests, I may do a virtual one as well.
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Weston, thank you for being the voice of reason on this subject. It can be hard understand what you should be charging, let alone believe it. I definitely think you should do a virtual session on this particular subject. I think just about anyone will get some nugget of information because this is a subject we can all continue to grow on.
Thanks Tyler. Appreciate the feedback. I’m hoping more will chime in as well!
A virtual workshop of that caliber would be awesome!
Thanks for the upvote Cam!
Who else truly cares and is going through all these exercises like weston/synkedup with people before they even sign on the line or pay a penny to try and better themselves? Just sign up for synkedup, it will be far better for you in the long run then going down to the dealer and putting that $400 towards a payment on a shinny new truck.
Appreciate it brother 🙏😊
I would love to see a virtual!
Right on! ☝️
This blog was great! I’m a good distance from Ontario but if you could do a virtual seminar or if you’re planning one closer east I will be more than interested!
Right on Eric!
You should 100% do a virtual one of these. I’m not sure how well that would work since you couldn’t easily see what the attendee’s budget is looking like, but that would be pretty awesome!
Definitely wouldn’t be the same as in-person, but I am sure we could still provide some great teaching