PRICING TO CLOSE LOW-VOLTAGE SALES

By Constantine Pergantis, Nite Lites North Potomac, MD

Many landscape and irrigation contractors have no trouble pricing materials and labor to come up with a fair price. Customers who ask me if the price I quote is my best price get my standard, yet effective, reply: No, that's your best price. My best price is $250 more.

While there is no single right way of pricing, there are a few important concerns to know about each choice. Ultimately, you must know your costs in order to charge enough to make a profit. However, that may not be the most effective way to present a bid to a customer. You might have greater acceptance by keeping things simple.

For example, once you know your true costs, you can calculate a profitable price per fixture. Built into this price are costs for cable, transformer, design, labor and overhead. If an electrician will be needed for the transformer hookup, make this clear and present it as an additional cost.

With this type of pricing, you won't draw attention to the more expensive components and tempt the customer into cutting quality for price.

With experience, you'll discover that your installation costs go down. This reduces your cost per fixture and gives you latitude with either pricing or profit. You might want to create a different per unit price for fixtures that are more difficult to install. The idea, however, is to keep pricing simple and to keep negotiation in your favor.

The other option is to break out all component prices and labor for the customer to see. This appeals to customers who want to be informed about work on their property.

Personally, I break down each item (transformer, fixture, cable, installation, and electrician, if needed), and any additional fixtures that might be needed (within reason) at the cost of material only. It works for me, but you take the chance of getting into a discussion on why some component is expensive.

The initial meeting, drawings, assembly of material, nighttime positioning and the favorite of every contractor, callbacks, all have costs associated with them that must be recovered. You might want to try charging for design and crediting this charge if you get the job.

I close 90 percent of my estimates because most people are referred to me and already want outdoor lighting. If you find yourself not closing jobs consistently, you need to reexamine all of your pricing practices. The key to closing may not even be pricing. Services that give the customer confidence in you and your company could make the difference. Consider warranties and annual checkups for system performance. Items like this might put you over the top.

Remember, as plants grow, you will need to adjust the low-voltage system. You might need to move a fixture or install a brighter lamp. You can schedule this type of work for slow periods. Make a point to let the customer know you are there in case he needs help.



8806 Daimler Court, Potomac, Maryland 20854
voice: (301)-762-5444 efax: (240)-597-8552


Copyright © 2001. Nite Lites





Questions or Comments? Please Send Mail to: nitelitescgp@hotmail.com