Local Cleaning Services
When you start a local cleaning service business, especially a business based off of the Launch27 method, a sticking point before launch is where to set your prices. The easy way out is to just make your prices the same as Rohan’s/ Maids in Black. After all, a premium service should command premium dollar right and… Rohan has already proven these prices right?
During our Groove Learning call this week, Rohan revealed to us that his prices didn’t start where they are now. In fact, he has raised them over 10 times. He said that if people aren’t complaining about your prices, then they aren’t high enough.
How do you price the services your local cleaning business provides?
Here are a few ways to determine prices:
Price in the middle of established companies
Finding the pricing sweet spot to start at can be as simple as calling your competitors and getting a quote from them. Even better, hiring them to clean your residence can give you both the price and a benchmark for where the quality of your services should be.
People pay for convenience. If you can book online without the hassle of calling for a quote or even worse, having them come out to your house to provide a quote, you are adding value to your service and can command a higher price from those that don’t.
Perceived value allows you to price more competitively (and justify raising prices in the future). If your services and web presence look high end, customers will have less of an issue paying more. Just make sure your services match the quality of your brand.
Based on the cost of contractors
Contractors in New York City will cost double an hour what contractors in Idaho cost. Your local wage rate should inform your services’ final price.
Test your prices
Once you have determined where to start your prices, now it’s time to test them. The only way to know whether your prices are right is to drive traffic to an optimized website with a booking form. If you are getting a lot of bounced traffic but have a well-designed site primed for conversion, your prices could be too high. Use A/B testing to determine what the optimal price is for your customer to pay.
Once you have that established and business is growing, it may be time to consider raising your prices.
So when do you raise your prices?
Raising prices in theory sounds great but how do you know if it’s a good idea or when to pull the trigger? Here are a few signs that it’s time.
- You are fully booked and you have a healthy stable of recurring clients.
- You see more expensive services around you that are thriving and don’t offer the value you do.
- You don’t feel as though your time is being valued enough (which can lead to resentfulness).
- You aren’t comfortable enough with your margins
Do any or all of these apply? If so, it’s probably time… Here’s how you should approach a price hike.
First, let your customer’s know that pricing will change and offer them some kind of transition plan (which can end up being lucrative for you ie. book a year of appointments at the current price). Make sure your customers are kept in the loop at every step (having them land on your site with no notice is not a great way to let them know) and when enough warning time has passed, change your prices on your website as well as all marketing material.
Ready to start the process? Here is a great email via Kendrick Shope that shows just how it should be done. Of course, modify to suit your clients and industry.
Grab attention quickly with a paragraph that things are changing and how it will benefit your client. For example…
I’m excited to update you about some changes I’m making to my services that are going to help you [insert the desired outcome of your customer].
Quickly establish your credibility.
I’ve been lucky to work with some of the most amazing women and have watched them [insert specific results from your testimonials] as a result of our work together.
Plant the seed with why you set yourself apart from the rest.
As I continue to grow, it’s my desire to continue to offer unmatched service and results that improve my clients’ lives.
I know that one of the reasons my customer experience drastic results is [insert education, level of service you provide, or something that makes you different from others in your industry].
Announce the increase.
Effective [insert date], [insert package name] will increase to [insert new price].
Reward your customers’ loyalty.
It’s my goal to reserve [insert number of spots] remaining spots at the current rate of [insert your price before the increase] for you before the price increase is officially announced on [insert date you’ll announce or publish the increase].
Close the email reminding people of the results you create.
I’m thrilled to continue to help you create [insert desired outcome from testimonials].
Please let me know if you have any questions or would like to hold one of my open spots. I’d love to work with you.