Nov. 25/Dec. 2, 2019: Volume 35, Issue 11
By Jerry Levinson
I’ve worked with many flooring dealers on a one-on-one basis as well as in the Flooring Business Master Classes. I’ve found that many flooring pros make the same mistakes when pricing their products and installation.
The most common error made is on the initial contact with the customer. A typical customer will asks, “What do you charge for new carpet?” Most flooring professionals will respond: “It depends—do you want a plush or a berber? We have carpets as cheap as $2 a square foot or as much as $10 a square foot. It depends on your situation.” However, this is the way everyone should answer that question: “Tell me about the project. What are you working on?”
This response leads to a dialogue that moves the customer away from price and into a more meaningful discussion that gets to the root of her needs and demands. Price will follow once more details about the project, the environment and how the space will be used are determined.
Following are other points to keep in mind when selling:
Don’t sell yourself short. Demonstrate the value of your product as well as your installation. Flooring installation is very complicated and requires a great deal of knowledge, experience and skill. Retailers should never allow a customer to believe that all things are equal. If you don’t value your services, your customers won’t, either.
Leverage your knowledge. It takes months, sometimes years, to learn and understand our product lines, services and the sales process. Yet we sometimes treat customers as if they are more knowledgeable about the product costs than they are when they walk in the door. Don’t assume they’ve been shopping around, getting prices from box stores or other retail outlets. Resist the temptation to lower your price in order to compete.
Never itemize. A lot of companies offer a breakdown of prices and services in the name of transparency. Newsflash: Many of our customers don’t care. What they really want to know is the final cost to put the flooring down and get their house back together again.
Remember, if you provide a breakdown of products, accessories and services, customers may feel they can pick and choose which service they want in an effort to save some money.
Protect your margins. There are a lot of flooring dealers who still work off of “mark-ups” instead of margins. Here’s the problem: with a mark-up you have to figure out your costs first. Then you have to add how much profit you want to make. Psychologically it is difficult to charge the customer more money when you or your sales staff understand what the exact wholesale cost is. Furthermore, with a healthy margin, you can offer discounts, sales, specials and free upgrades.
Never lead with price. All of my salespeople have a hidden shock collar on their neck in case they mention price before the customer. Too often it is assumed the customer wants less expensive materials, or she is looking for a bargain, or she is shopping all over town for the best price.
Asking a customer if she has a budget may be a legitimate question, but in most cases she doesn’t. Always allow your customer to ask about price first.
But when you get asked about price, be prepared with your response. Practice your answers with your team so they are prepared to show the value and awesome customer experience you provide.
Jerry Levinson is the owner of Carpets of Arizona and founder of Profit Now, a consultant business for flooring dealers. He has also authored two books on sales and marketing. In addition, Levinson, manages the Flooring Dealer Group on Facebook, which boasts more than 3,000 members.