There is a drumbeat in the industry magazines to raise prices, either to get ahead of inflation or to take advantage of supply and demand.
But raising prices is not enough of a strategy. Raising prices does not mean raising value.
Unless you are actually mis-pricing your work and losing money on each job.
For example, I spoke with a young upstart from Illinois who worked 120 hrs a week in the spring in part because she was using an outdated overhead recovery model — that she first instituted when she started mowing at the age of 16!
For many of you, it’s not about fixing your pricing method, rather it’s about staying current.
But simply raising one’s prices without raising value leaves your business vulnerable to economic swings and competitive forces.Do not raise prices without raising value. Click To Tweet
it’s critical to identify where your lawn and landscape clients want more value.
Here are four places clients want more value:
1. Add new lines of service.
Offer new products to your existing client base. Keep things either easier or more exciting for them, so they have no need to shop from a competitor.
2. Provide stellar communication.
Clients want to be communicated more timely, more thoroughly and in the method that they are accustomed. But most contractors are spotty in how they communicate as a company.
How would your customers score you 1-5 on your company’s responsiveness and communication?
3. Improve customer service.
There are two types of customer service, Reactive and Proactive. One is hard and the other is even harder.
Reactive means responding to requests and problems in the field, from warranty replacement/repair to handling requests for enhancement work. (Note: Stop chasing new business when existing clients are underserved)
Proactive means informing clients proactively on their schedule, but it also means identifying issues before a client brings them to your attention.
Do you do both well?
4. Build stronger relationships.
As a business owner you want your clients to be loyal to you, but how loyal are you to them?
Loyalty starts by building strong relationships, so you can better understand your clients’ needs and hot buttons. Stronger bonds also increase the perceived value a client receives from you.
Perception is reality.
As a consultant, I find it critical to walk the talk, to follow the same advice I’m giving. As I raise fees, even if I’m just keeping up with inflation, I add new offerings and constantly look for ways to provide more value.
This helps my clients stay on the cutting edge, which they appreciate greatly.
Your Challenge: Decide what happens to your legacy clients as you grow beyond them.
Follow the 20-10 rule.
As you add new clients at the top end of your client base (those in the top 20%), you should consider saying goodbye to old clients that occupy the bottom 10% of your client base.
Why? Because doing this will allow you to grow your overall business focus and reputation, without trying to become all things to all people.
Success comes from focusing on a client niche, understanding them better than your competitors, and proactively meeting their growing needs!