Charge for Your Estimate to Serve the Customer Better
Recently I had a discussion with a custom home builder who was asking the question...
How do I keep prospects from taking the proposal that I spent all this time on to another builder who undercuts my price?
Good question? The answer is you don't, but start charging for your estimate. The next question then is...
How do I get a prospect to pay me for something that someone else will do for free?
The answer is to make sure that you are adding real value to the process. Here is a suggested script.
"Mr. Prospect, you can describe your vision that you have of your dream house to two or three different custom builders and ask us all for bids. You are potentially going to get three bids that fall into a wide range."
"We are all making educated guesses!"
"That is why there are significant cost overruns on a large number of projects . The builder and the client did not spend enough time up front to be accurate. Of course, it is not profitable for any business person to develop comprehensive and in-depth specifications for free. They may not get any more work than they do when they just guess."
"Here is how I am different."
"I work with with you first on a consulting basis to develop to exact specifications your dream home. I will charge you for my time. When we are done, you will have my bid and a plan that you can take to other builders if you wish to have them bid on the project. No matter who builds your dream home, you can be confident that it will be built the way you want it built and it will cost what you expected. However, if you are comfortable with me and ask my company to build your home, I will apply the design fee to the cost of the project."
With this approach, you the custom builder get:
- A prospect who is serious. Tire kickers don't pay for things up front.
- Paid for your time whether they build with you or not.
- The benefit of the scarcity rule of influence. Because you charge, you must be in demand (i.e., your time is scarce).
This is an approach worth trying for any complex sale, don't you think?
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