Feature Story
25 Lessons I’ve Learned About Pricing Lawn and Landscaping Services Over the Past 25 Years
B
oy, I really dated myself with this article’s title. And, thankfully for you, have made many, many mistakes related to pricing lawn and landscaping services over these 25 years for you to learn from. You’re welcome :) I tried to group these insights into three buckets for easier consumption. First, my biggest insight: While pricing is the most important factor related to your company’s profitability, price is not the most important factor when it comes to making a sale. That should be good news. Here are 24 more...
On buying factors and the buyer’s experience
• Price is more important in the mind of the seller than it is in the mind of the buyer.1 The best salespeople on the planet understand this. • Price is almost never the primary reason why anybody buys anything.2 • Convenience trumps price. I bet I can price myself 15 to 20% higher than you, and with a superior buying experience for the customer, I will still close at a higher rate. • Price makes a statement about credibility. Most of us have a gut feeling that price intrinsically has something to do with the quality and value of the product or service that we are buying. Therefore, more people actually buy on the basis of the price being high than those who make a purchase on the basis of the price being low.3 • If you are pricing higher than most of your competitors, you are most likely not losing sales based on that
28 FALL | 2020
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higher price, but instead on the fact you’re not talking about price early enough and confidently enough. If your customers are asking for line item and unit pricing then you haven’t built enough trust and value during the sales process. Also... If you are offering line item and unit pricing in your proposals without your customers asking for it, you are handicapping yourself for no reason. You’ve commoditized yourself. Price for the customer, not yourself (i.e.- the business owner). As a homeowner I’ll pay $75/month for a green, weed-free lawn. Don’t try to sell me 7 applications for $129 each. I want to pay for lawn care service just as I pay for my gym membership, Netflix, etc... Offer options as much as possible, whether you’re selling lawn care, design/build, or commercial maintenance. You don’t always know what type of buyer you’re dealing with. Offering three options allows you to price for the small percentage of “price shoppers” and the “Iwant-the-best-of-everything shoppers”... and everyone else in between. A delivery problem (i.e.- service) is virtually always the trigger event that causes loss of a sale to an existing customer.4 Not price.
On pricing and positioning
• How you price your landscape services needs to align with your positioning. If you’ve positioned your company around an expertise (ex.- permaculture, arboriculture, etc.) then you must charge a higher fee for that expertise, otherwise you won’t be perceived as the expert. • The less you offer (i.e.- the more specialized you are)
