I just raised my inspection prices. Lets start working towards what we are really worth!
If you want to make what you truly are worth, don’t raise your prices once a year. Rather, raise them once a month.
I raise my prices all the time. I also lower them sometimes.
When gas prices skyrocket around here during tourist season (Memorial Day to Labor Day), my prices skyrocket with them. When gas prices come down, so do my prices. Never ever nickel and dime your clients, though, especially with a “gas surcharge” or a “fuel surcharge.” FedEx lost my business for eternity a few years ago because they started adding fuel surcharges. Just raise your price to reflect the increased overhead.
Insurance is another example. When I had nine employees and was paying $10,000 a year in E&O, my prices reflected that. Now that I am a sole proprietor, my E&O is much, much lower, and my prices reflect that.
My current average inspection fee for October 15, 2001 to January 5, 2014, is $701.06. For the last five years, when my prices have actually been lower because I have no employees, my average inspection fee has skyrocketed.
The idea of raising them monthly is interesting. Realtors and clients don’t like moving targets and typically like to know what to expect in pricing I find. Price is a bigger deal then people think. It is always one of the first 3 questions, 1. What services do you offer 2. How much 3. When can you do it?. I post my pricing, which a lot of guys don’t agree with on (on two fronts) but, it is typically and automatic booking when they call. Or down to just the one question, “when are you available”. People waited 2-3 weeks out for me all during the busy part of the year, which was about 9 months long. So, I don’t think changing pricing that often would work well in my case. Specially not monthly.
The #1 question I get asked is “How much do you charge?”
I also have posted prices, and the posting says “Prices good for 30 days. After 30 days prices might change depending on the economy.” Prices are dated, and if the 30 days ends on January 31, but someone calls on January 30, the price is honored. However, it’s not necessary to keep a posting for the full 30 days. If gas prices spike on January 15, I’m going to post a new price list, still good for 30 days, but it will reflect the spike. There have been times during the summer that I adjust prices weekly.
“Moving targets” would be relevant if I raised the price significantly. However, I’ve worked with over 6,000 Realtors and not a single one has ever said, “Russel will charge you $349 for the inspection.” Rather: “The home inspection will cost about three or four hundred dollars. Call Russel and get a quote that’s good for 30 days.”
That moving target is exactly why I don’t recommend raising prices once a year. Can you imagine the Client who had a home inspection on December 20 for $349, canceled the purchase contract, called for an inspection on another property on January 3, same square footage and just two blocks away from the first, but getting quoted $399? Yeah, that’s a moving target and probably would infuriate just about anyone. By adjusting prices monthly, though, my original $349 inspection would still be pretty close 30 days later. Might be $359, but that’s insignificant enough that no one questions it like they would a $50 difference.
We went up $25 across the boards. None of my regulars flinched. Honestly I don’t believe any of us get paid what we are worth, especially when you compare to what agents get.
You got that straight. Billy raising your prices in a market like South Florida will only get you one thing. Less Biz especially specialty insurance inspections. Since licensing went into effect folks only appear to care about price. I purposely over price all Written home inspections it accomplishes 2 things. It shows folks what I think about myself and my qualifications and it makes my Home Inspection Alternatives " Walk n Talks" look great. On the rare occasion I get a written home inspection at least I get about 1/2 of what I feel they are really worth and that is a lot more than most around here get for them. Quoted a 4/3 approx 3200sq at 600 with insurance inspections included “a wind Mit” and never heard back. Imagine that
I agree with Jeff. Or at least it is what works best for me. I post my prices on my website. I send my price sheet (pdf) out each month in my monthly email to all of my realtors. And, I physically hand-out a copy of my price sheet to everyone that will take one. I realize this method doesn’t allow me to increase my prices when I get real busy. But, within my inspection area everyone knows my prices, and this makes it real easy for the agents to tell the buys how much an inspection will cost, which gets me a lot of inspections. But that’s just what works best for me.
I don’t place my prices on my website or any other printed material. I’d rather the customer call me and if they are price shopping that’s fine I’ll tell them what my cost are and it gives me a chance to book them.
Interesting thinking Russell. Thanks.