How much business would you lose if you doubled your prices???

Discussion in 'Marketing / Business / Advertising / Websites' started by Rob Allen, May 28, 2008.

  1. Rob Allen Administrator

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    I mean really doubled them. Would you lose 25%? 50%? Maybe all of your customers? Let me know what you think and then I will tell you what I think!

    Rob.
  2. jimmy crawford New Member

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    Interesting Rob
    I market to the top end earner's and demand the best return possible. But, if I tried to double my price's, all the hard work done getting these customers on board would disappear at a rate of knots. At the end of the day these customers are my best friends (from a business approach)
  3. VCS New Member

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    I would say at least half...why?

    Keith.
  4. Rob Allen Administrator

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    OK, suppose you lost half of your business. Well you would still make the same amount of money in HALF the time. So I raised my prices GREATLY...less gas, less wear and tear on me, employees and equiptment!

    Now as to what Jimmy said, yes my customers are my friends too. So I tell them they get the 5.00 a room price increase for being a long term customer. Doesn't sound like much but that is at least another 25 dollars per job.

    Multiply that by 4 trucks and 3-4 jobs a day and it is huge. Averaging 500.00 a day more and I have lost no customers. This does not even include the large increase I am charging new customers!!!

    My bank account has swollen. Shouldn't yours????:p

    Rob Allen.
  5. jimmy crawford New Member

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    Like your thinking Rob.
  6. Rob Allen Administrator

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    Thanks man. I want to write an e-book on how to do a K-a-Day. Something along the lines of...

    1 man
    1 truck
    1 k per day

    What do you think???

    Rob.
  7. TheEyeball Well-Known Member

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    Sounds good but I'm too scared. I've already lost business with the current down turn in the economy. If anybody else tries this and it works let us know!
  8. tweiii New Member

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    I recently went up $10 per room and have been scheduling the same amount of work.
  9. Rob Allen Administrator

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    So how much per room are you now???
    Rob.
  10. johntalley Elite Member

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    when will the book be done ?

    I'm in bidding wars with 39 restaurants now so far the other guys are winning because they are just a few dollars less

    I have got 1 of 39 so far had to bid under the other guy to get that one ..

    As far as my restaurants after I build up the match what I have now then I'll try and get more $$ then if I lose them I can stll pay the bills ..
  11. Dave Rampage New Member

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    $1,000.00 per day with one truck with one man is easy to do. I do it and work less than 40 hours a week most weeks.

    Dave
  12. Billy User

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    John there will always be those that want the cheapest price this isn't the type of client we try to get.

    As for the original question if I doubled prices right now I would probably loose more than half for sure since we are already much higher than most. Average price for us now is $0.85 + $0.28 for protector.

    Rob that is a sound philosophy we use that was taught to me by my first mentor.
  13. Peter Klujian New Member

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    Doubling your price depends what you are charging to start with. Is it 20,25,30,50,or 60 cents a sq. ft. right know we are at 65cents with a $350. minimum. Thinking to raise my minimum to $400. especially in high rises. Not worth doing it for less then that with the time it takes to get in and out of some of the buildings especially if they can't provide parking for their sevice people. We also charge any parking fees.
  14. Billy User

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    We also charge a higher min for High Rises or further out. So far when we have done a High Rise parking hasn't been an issue because we let the client know up-front we need parking arranged by them.
  15. Rambo New Member

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    If I doubled prices, I would be out of business. I am actually charging less today than I was 15 years ago. Of course in my small town there were only two of us in the CC biz. Today we have 34 serving the same area. We have changed our pricing and marketing to compensate for this and still stay buzy and make a decent living. It really boils down to the area you serve, the ecomony in that area (I don't think I would be happy serving Detroit right now) Raising prices sounds good on the internet but it is not reality for us. I have been in this industry for 30 years and this is the worst I have seen it.
  16. Nick Nellos Active Member

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    It may work as long as your are not in a elastic economy.
  17. Rob Allen Administrator

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    John and Nick now one thing is for sure I like to offer a reasonable price to get me in the door on commercial. Then over time go up. My post was really talking about residential and I should have stated that. I also realize that it is a tougher call in a sour economy.
    Rob.
  18. SAA Member

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    Interesting concept and some of the comments about where one is on the price scale is important to consider.

    Let's just say one is a normal cleaner and their prices are somewhere in the middle, (where ever that may be but this is just for discussion sake). Let's say one's cost is consistent with each job, we'll just use 60% cost on each job with a 40% net profit, (it can be anything, this again is for discussion sake).

    If one were to double their cost, they could lose right at 70% of their work and still make slightly more money, on the average. Pretty interesting when one looks at the math and the possibility of doing this.

    Even though this is a hypothetical situation, doing the math on something like this on one's own business makes a real argument for raising prices and NEVER lowering them.

    Just an interesting thought and it was a reasonable answer to understand at least the principle of what would or could happen.

    Imagine, raising prices, losing some of the customers one may not want anyway and then having not only more money but maybe more time to spend with the family or..............

    SAA
  19. Rob Lyon New Member

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    I like The Idea Rob, Write The Book!
  20. Steve Smith New Member

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    We would probably lose 90%.

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