Watch this video to find out how to make more profit without upsetting your current customers.
We help business owner systemise and organise their business so it runs without them. We do this through the use of mobile apps. We also help business owners to met to maximize the profit they’re getting from each and every customer and also to increase the conversion ratio. Which is the number of people that ring you for a quote that actually then go on to buy.
So I’m going to tell you little story today about how you can increase your profit by charging customers more money for the same work. Which sounds completely stupid, but you can do it. So I’ll explain how I would do this by telling you a story. I was speaking to a guy 2 or 3 weeks ago and the topic of conversation was that he wanted one of our apps but was saying he couldn’t justify spending money to get what he wanted. So I said ok well what we’ll do is I’ll make it so the app makes you more money than it cost you. So he asked “how are you going to do that”? Ok I said, let me give you an example. Give me a an idea of a really common service that you offer on an almost day-to-day basis. This guy was one of these everything kind of guys who does plumbing and plastering and a few other bits and pieces. So he said one of the things they do a lot is fixing toilets. I asked how much it costs to fix toilet average to which he said about £50. I then explained what we’re going to do is we were going to take a £50 job and we’re going to create from it three pricing structures:
£50 fix a toilet
£80 to fix a toilet
£120 to fix a toilet
So he said “how are we going to do that? Nobody is going to spend £120 when they can fix it for £50”. I explained that this technique works on the principle that you’ve got different customers that are prepared to pay different amounts of money for the for effectively the same service. At one end of the spectrum you’re going to get a little old dears whos really tight on money and wants to spend as little as possible. But to do so they’re quite happy to put up with a little bit of Hassle. On the other end of the spectrum you get people that simply want to spend as much as possible because they don’t want any hassle. So will this technique what we’re going to do is we’re going to going to charge £50 for the cheapest price. But we’re going to do is going to put some caveats around. So if you want to have your toilet fixed for £50, I get to turn up whenever I want in the next seven days, at a time of my choosing. So that meant that ticks your box you get this cheap price. But for me it means I can be flexible and can come when I’m almost passing. The second price is quite similar, £80 price, that’s the same deal. But I’ll turn up sometime within the next 3 days rather than 7 days. But again I want to come wherever I want. For the top price of £120 I’ll drop wherever I’m doing now and come now and I’ll fix it for you. What you’ll find is that your little old ears will pay 50 quid and they’ll waiit because they’re not going to spend £80 or £120 – it’s not that important to them. A school on in the other hand that’s got poop running down one of the corridors is going to spend a £120 because they can’t put up with it being like that for any more than a few hours. Never mind a few days. So that’s a really simple technique you can use in your business to basically to generate more money from the same job by just tiering your prices.