When Raising Prices Backfires BADLY!
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Key Takeaways
Focus on the total quote price, not just your hourly rate, as customers prioritize overall value and efficiency.
Use your close ratio as a key indicator for pricing: a 70% close ratio is ideal for growth, while 90%+ suggests prices are too low and under 20% means you're wasting resources.
Implement pre-qualification methods (e.g., card on file, deposits for estimates) to filter out 'tire kickers' and improve the efficiency of your sales process.
When considering refunds, differentiate between legitimate mistakes requiring a fix and avoiding conflict; only refund when it aligns with long-term brand reputation and is financially sustainable.
Structure money-back guarantees with clear terms and conditions (e.g., specific service period, proof of issue) to prevent abuse and protect your business from significant financial loss.
Understand that home service businesses have significant 'hard costs' (materials, labor), making refunds more impactful on profitability than in industries with lower direct costs.
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