What to Do When a Customer Says “Your Price is Too High”
Price objections are really common in the flooring installation and home improvement industries. Sometimes, budgetary restrictions are truly the reason a customer pushes back on price.
Other times, it’s because the customer knows that you might give them a discount if they complain about your price. So, how can you tell the legitimately price-conscious customers from those who are trying to get a better deal?
Unfortunately, most of the time, you can’t.
Instead, you have to get really good at communicating your value and handling price objections. You don’t want to immediately lower your prices because that can ruin your margins and lower the perceived value of your work.
However, you also don’t want to lose the deal every time a customer says, “Your price is too high.” So, what should you do?
Here are six proven strategies for handling price objections and winning more work:
1. Evaluate Your Estimate and Be Sure It is Fair
The very first thing you need to do when someone objects to price is to be objective yourself. Take a step back and reevaluate your estimate to make sure it’s fair. Is it possible that your price is too high?
This is especially important if you get price objections a lot. If you’re running into people objecting to price on almost every deal, then it usually means one of two things:
- You’re targeting the wrong customers in the wrong income bracket, or
- Your prices really are too high.
When you get price objections, you should take the time to make sure your estimate is fair.
2. Clearly Break Down Components of the Estimate
Take time to line-item everything on your estimate. Customers will have a difficult time understanding your value if your estimate just has a single total for the completed job.
Instead, break it down for them. Tell them how much they’re paying for each material. Show them how much the labor fees are. Be sure to show them how much each part of the job costs (i.e., the price for the existing floor removal, the sub-floor preparation, the installation fees, the finishes, etc.). If you break things down by square footage, show them that, too.
Ultimately, you want it to be crystal clear why your estimate is the price it is. Customers are much less likely to object to the price when they see how much everything costs.
3. Compare Your Price with Expensive Competitors
Sometimes, the best way to tell customers your prices aren’t too high is to compare yourself to someone whose prices are too high. Know how much your competitors charge in order to prove to your customers that your prices are fair.
Say something like, “I know you feel like my estimate was high, but just know that ABC Flooring and Main Street Installers both charge double my price!”
Customers will have a harder time knocking you for price when you prove that you’re cheaper than your competitors.
(Bonus Tip: If your customer says, “But, XYZ Flooring is cheaper than you,” Then restate your value and tell them they can go to XYZ Flooring if they’d like to. Most of the time, the tactic of mentioning cheaper competitors is to get you to lower your rate. The customer likes your work, but they just want to see if they can get a discount. Don’t be afraid to call their bluff.)
4. Focus on Investment Potential and Long-Term Value of Your Work
There are probably plenty of installers who are cheaper than you are. If that’s the case, you have to win your customers over with the long-term value. Tell them why you’re the best and explain that quality floors are an investment that can increase home value and save money on future issues.
For example, if a customer goes with a budget installer and budget flooring materials, the chances are that they’ll be doing the same thing again in a few years. Alternatively, if a customer chooses you, a quality installer, they will pay one time and have beautiful floors for years to come.
Pitch the long-term value to let your customers know why you charge what you charge and why your other customers have been happy to pay that amount.
5. Find a Way to Offer Lower Cost Alternatives
Often there are ways to cut your costs. It helps overcome price objections, and it also helps increase your margins and profitability. Who doesn’t want that? But, how do you lower costs?
At BuildDirect, we have the largest selection of high-quality flooring materials on the market. We have a wide range of attractive and versatile flooring materials at a price point that meets everyone’s budget.
Plus, when you become a PRO Rewards member, you get access to exclusive discounts, 5% credit, unlimited samples, on-site delivery, and more.
Choosing BuildDirect as your flooring material supplier is a terrific way to lower your prices to meet customers’ needs and increase your profit margins while never sacrificing quality.
(Become a PRO today. It’s free and only takes a few seconds to register.)
6. Move On if the Conversation Isn’t Going Anywhere
The reality is that you can’t win them all. Some people can’t be convinced. Others won’t budge until you give them a discount, and offering a discount isn’t always the best move. So, don’t be afraid to let a potential customer go if the vibe isn’t right.
You’re better off spending your time working with customers who appreciate your value and are willing to pay you what you’re worth, rather than wasting your energy on customers who are trying to bully you into rates that are below your value.
When you free up your time for customers willing to see the value, your business and stress levels will improve substantially.