Selling Based On Price – Why It Is Bad For Business

When you are out in the field pitching your product, everybody wants a lower price. They want you to beat the price of the other guy, give them a better deal, save them a little cash. Here’s why you should say no.

The price of your product is a symbol of it’s value. If you price your product at $1000, then you must believe that a customer is going to find more value in your product than they do in their $1000, so your product is worth some amount more than $1000. When a customer tells you that you need to lower your price, they are saying that your product doesn’t have enough value to be worth the $1000 that you are charging.

As soon as you enter into pricing negotiations, you are agreeing with the customer. You are telling them that they are correct, your product doesn’t have the value that you first claimed. You begin backpedaling, well maybe it’s worth this much? This much? Instead of managing the transaction, you then become the victim.

When a customer objects to a price, they are saying that they don’t see $1000 worth of value. If you believe that your product has more value to your customer than $1000, it is your job to show them why. If your product truly has more value than the price you are asking, then you are doing your customer a disservice by not showing them why and bringing them to the close. If you are the best installer, with the best products, and the best customer service, find a way to show that to your customer, and prove to them that your product is more valuable than what you are asking.

Entering into price negotiations is telling everybody that you don’t really believe your product is worth what you are asking. If that is the case then you should lower your price to reflect the actual value that you bring your customer. If you don’t believe your product has value, and you don’t completely believe that your product is the best option for your customer, than you shouldn’t be selling it.

Getting (And Keeping) Your Builder’s License

Before you can get into the construction business, you need to have your Residential Builders License. Too many people are operating without a license because they just aren’t sure what they need to do to get one, or they assume that it is really difficult.

When people operate without a license, they damage the image of the construction industry and make it more difficult for legitimate contractors who have their license. Unfortunately, there are a lot of people operating without being licensed, pretending to know what they are doing when they don’t. This is not only irresponsible, it is illegal.

The truth is, the cost of getting your builders license is a lot less than the risk you are taking by operating without a builders license. While some types of work don’t require that the contractor be licensed, most of them do.

While it varies from state to state, even a painter is supposed to be licensed in Michigan if they are charging over $500 for a job. Operating without a license can lead to stiff fines, and even jail time if the judge decides to drop the hammer.

Getting your builders license in Michigan will cost you around $1000, much less than the potential fines from operating without it. You will be required to attend a mandatory 90 hours of training, which can be done online or in person. This will teach you a lot about construction, as well as basic knowledge required to run a business.

Once you have completed your training, you will need to send proof of that completion and an application to the state, requesting their permission to take the builders license exam. Once you are approved, they send you a letter and you are allowed to schedule your exam.

As long as you know the material, the exam is fairly straight forward. It is taken on a computer, which allows you to get your score instantly and know if you passed or failed before you leave the exam room. If you passed, your license will be mailed to you within a week or two. If you fail, better study up and try again!

Once you have your license, the fun doesn’t stop there. As a new licensee, you are required to take at least 21 hours of continuing education within the first three years in order to renew your license, and 21 hours again during the second three years. After you have had your license for at least 6 years, the rules relax a little and you are allowed to keep your license with only 2 hours per year from there on out.

 

 

Accounting Software For Your Business

Even the smallest of businesses need an accounting system, but a lot of small business owners don’t even know where to start. Unfortunately, a lot of them aren’t sure how to handle it, so instead they just let receipts and paperwork pile up until tax time, and then they are completely overwhelmed.

While it is possible to keep track of everything on paper, there is no reason to anymore. There are many free online accounting software programs now, such as Wave and NuCash, but be careful when using these programs. A lot of the free software programs make their money but collecting your customer’s information and then selling it, so be sure to read the fine print. If you do allow the company to sell your customer’s information, you are required to let them know that it will be sold.

There are many cheap online accounting software programs available that don’t own your customer’s information, so it is probably best to go that route. Quickbooks online has their most basic version available for $7.99/month, and if you call into their sales department instead of buying it online, you can get even better discounts. Their most recent special was $14.99/month for the ‘Plus’ version, which is the highest version you can buy.

Quickbooks online has helpful features, like syncing with your bank accounts and credit cards. They import transactions into your Quickbooks account, so all you have to do is input the details. This ensures that you don’t miss any purchases or valuable deductions, and helps you to keep a close eye on all of your finances. It’s like having your own bookkeeper for only $7.99/month!

Whatever you decide to do, don’t just sit there and let it pile up because you aren’t sure what to do. There are many online tutorials available teaching you how to do your accounting, and Quickbooks specifically has a huge knowledgebase you can pull from.

 

What Are The Little Rock Granules In My Gutter?

When shingles are manufactured, there are mineral granules pressed into the hot asphalt. These granules create the color of your shingles and protect them from UV rays, as well as make them fire resistant and more durable. As your shingles are exposed to the elements, it is not uncommon for small numbers of granules to come off and get washed down into your gutters. They will look like little rocks and you might see them here or there as your roof ages.

If you are seeing huge numbers of granules, to the point where it looks like there is gravel in your gutters or coming out of your downspouts, your roof might be nearing the end of its useful lifespan. However, there are other factors that can cause granule loss, such as heavy rain, hail, or damage from foot traffic. It is normal to see some granules loss on these occasions and does not necessarily mean your roof is failing.

If you are seeing a large number of granules on a regular basis, and you start to notice that your shingles look spotty or bare in areas, you should call a roofing professional to take a look before you have a leak.

 

The Value of Time

“It doesn’t cost anything, it will just take a little time.”

That very phrase is contradictory. Time is our most precious asset, and the only one that we cannot get more of. You can earn more money, you can buy more products or services, but nothing, absolutely nothing you do, will reward you with more time. With that in mind, time should be our most valuable commodity.

It is easy to forget that time is passing, especially as a small business owner. There is always more to do, busywork that keeps us up late into the night. It is important to put a dollar value on your time. What are you worth? $10/hour? $50/hour? It is hard to value yourself, but something that needs to be done. If your time is worth $50/hour and you are spending it doing work that could be hired out for $8/hour, are you properly utilizing the scarcest resource that you have?

The easiest way to start saving time is by evaluating your current processes, and figuring out how you can make them more efficient. Are you driving picking up checks, hand delivering permits, and running around doing other things that could be quickly achieved by mail, or even better, email? Do you have redundant processes in place that aren’t adding value, and are just eating up the time of you and your employees? Eliminate them!

In order for your business to grow, you will have to shake loose the things that are leeching your time, your lifeblood. So many business owners talk about working around the clock, how there is always so much to do and it is never done. It is time to start working smarter, automating everything that can be automated, and outsourcing the items that will cost less for somebody else to do them. So next time you find yourself saying ‘it doesn’t cost anything except time”, give yourself a mental slap. Time is the most valuable currency there is.

Efficient Advertising – Can The Old School Ways Still Cut It

A few years ago, advertising meant printing flyers, sending out mailers, filming TV and radio commercials, and buying newspaper ads. These days, the marketing landscape has changed drastically, but many companies are still following their old outdated processes.

If your advertising budget still looks the same as it did five years ago, it’s time for another look. What is the ROI (return on investment) of your current marketing methods? In other words, if you are spending $1000 a month on mailers, how much profit are you making off of those mailers? A lot of companies, especially smaller ones, aren’t even tracking these numbers.

Now days, you have Google Ad words, Angie’s List, Home Advisor, Thumbtack, and a whole slew of other lead providers and online lead generation companies. If you are going to efficiently spend those advertising dollars, you need to track your return. With so many options, your opportunity cost is equally as important as your ROI. If you are averaging $100 per lead with Angie’s List, and could be averaging $30 per lead with another company, you are missing out on that much business that you could be generating and not even know it.

When you are comparing advertising methods, the old school ways are generally the most expensive options that you can possibly buy. Another important metric is your CPI, or cost per impression. If you send out flyers in the spring, you have to pay to print the flyer, to mail them out, and for phone numbers to track incoming calls. Depending on the type of mailer you send, your cost per impression could be anywhere from fifty cents to two dollars or more, and you don’t even know if people are looking at your mailers or if your product applies to them.

Radio and TV commercials can be an effective way to quickly reach a large audience, but they are very costly. TV commercials are becoming less and less effective as people move to internet based TV services, and TV recording services like DVR where they can fast forward the commercials. The demographics of people that typically watch TV commercials are shifting to the older crowd, and they may or may not have a use for your service.

With so many people using the internet every day, online advertising has become extremely efficient. It is easy for companies like Google to target specific audiences that are relevant to your product, and the cost to do so is minimal. You can reach them instantly, you know whether or not they click on your ad, and you can track so many metrics it will make your head spin. With CPC (cost per click) as low as a couple of cents, nothing can complete with online advertising.

So the moral of the story? If you haven’t started moving your advertising budget to more web based products, you are behind in the game! It is still just as important to track your ROI and other important metrics, but with a little creativity and research, you could be bringing in a whole lot more clients with your same advertising budget.