WelcomeSaturday, November 26th, 2022
Do you charge more than your competitors?
In today's issue of The Cut Sheet, I provide 5 solid reasons why people might be willing to pay you more for your surveying services.
Do you charge more than your competitors? Why or why not?
Yes. I do. Because I want to work for the type of client willing to pay more and wait longer. So far, so good. Check back with me during the next recession.
Our fees are slightly higher than companies of similar size and specialties in the area, but drastically higher than than the small "survey only" companies. Prices for ALTA surveys are within $300-$500 of others in the area with the exception of the one guy that will certify an ALTA for a 20 acre commercially developed property for $1200.
I certainly do, and have for 22 years. I don't want the price shoppers - my niche is the prime clients who are willing to pay me to get it right the first time.
I do, allot of my work is for larger commercial developers who need fast turnaround times. We are able to provide them with that through a larger staff. We also provide the clients with an email letting them know when the field work was started, when the field work is completed and an update as their project progresses through each step in the process. They tend to like getting the notifications as they see their project moving along and don't blow the phone lines up asking questions on the status of their project.
Yes and No.
Sometimes what I charge is higher than my colleagues (I am not competing with them because I am not particularly worried about who gets what jobs). Sometimes, I am sure my rate is lower than my colleagues. In either case, I do not worry about how my rates compare with them as long as I am satisfied that I was paid an appropriate amount for my services on any particular job AND as long as everyone is working to the same standards.
Some potential reasons for the difference in pricing:
- specific local knowledge of an area might make the price higher or lower (some areas that are troublesome might lull an unsuspecting surveyor into thinking the job will be easier than someone who knows the area a little better)
- interest in doing the specific job might influence pricing (something I am not overly interested in will get an "I'll do it for this amount fee" and if I miss out, no big deal)
- how busy the survey market is at the time of the request (I know some people have to keep the employees busy and think lower prices help in tight times and I do not begrudge them this line of thinking)
- location (I hate working too far away, so I try to price myself out of remote jobs)
- the potential clients needs and means (helping someone out when they are in need can be beneficial - or it might backfire and cause problems, its up to you to decide how to proceed)
I like making money, but I have never understood the need to be the highest priced or the most exclusive surveyor. If your not making the money you want, charge more. If your satisfied that you are making a good living at your current rates, make sure you adjust to keep up with cost of living changes and carry on. Either way, make sure you are saving, investing, and living within your means in case emergencies creep up on you (applied both individually and business wise). There are too many surveyors (and people in general) who will find a way to be broke no matter how much money they make.
I don't know what other's charge, although a realtor sent me a bid on a job from another firm. I told them I was out, I couldn't bid it and called the other firm and told them what happened.
A realtor always gave her clients my name and I never got the job. When she wanted her lake lot survey guess who got the job. Hint, it wasn’t the guy with the lowest price.
I'm sure I charge more than most of my competition. I "check" from time to time and stay abreast of such things.
One of my crowning achievements:
I was once confidentially approached by an engineering firm to possibly replace another surveying outfit. They were dirt cheap and their work and turn-around time reflected such. There was no way I could beat their price.
At a sit-down with the engineering firm I got just as honest-as-hell with them, showed them my numbers, overhead and work load. I told them there was no way I could beat the other guy's price, but I could beat everything else. Long story short, I picked up a long term large client and wound up charging almost double of what their last guy charged.
It's all in the wrist.... 😉
That particular project was bid by myself and an old salt about 60 miles south of me. The old salt was a member of the Licensing Board at the time. He and I both bid the project at around $32K but was told Mr. $1200 was the low bidder and got the job. It isn't that Mr. LB is inexperienced as he holds licenses in multiple states; nor is he is independently wealthy where liability issues, if any, could come out of pocket. I just don't understand people like this. I have opinions, but will keep this a G rated rant.
We never bid on projects as a race to the bottom is not a great profit center. Our rates are comparable to other firms of the same size as far as we know (we can't exactly call them up and ask).