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How to quash competitors who constantly undercut your prices

They’re like flies buzzing around your head: They don’t pose much of a threat… but they sure are annoying.

I’m talking about The Undercutters—your competitors who constantly bid less than you for the same jobs.

You know the ones.

They’re the guys meet with the prospect AFTER you. The guys who say, “Whatever THAT company bid, we’ll do it for [XYZ] less.” The guys who—let’s face it—lack the professionalism, passion, and skill to do the job right.

Some prospects won’t take the bait.

They know better. They’ve done their homework. So they know that a “too-good-to-be-true” price is just that.

But other prospects? They’re not so lucky.

For the majority of homeowners, this is their first time contacting a contractor for a home improvement project. They don’t know that—in the remodeling industry—the “best price” and the “cheapest price” are NEVER the same thing. So they’re naivety is what makes them choose The Undercutter.

Don’t, however, get the wrong impression about these prospects. Most of the folks who choose The Undercutter over you do, in fact, want the highest quality. The kind of quality YOU provide. They just don’t know any better.

So… how do you keep Undercutters from poaching your customers and ensuring good, honest people don’t get swindled?

Here are four ways to quash an Undercutter’s powers during your appointment with a prospect:

1. Positioning, Positioning… POSITIONING

There’s no way you can match The Undercutter’s price. So you must make it abundantly clear that you—and ONLY you—are the best contractor for the job. End of story.

You use the proper clearances—to the millimeter—when installing siding. You protect new granite countertops with an industry-grade impregnating sealer. You have in-house installers who are passionate about their craft. You install kick-out flashing when putting on a new roof.

In a nutshell: You focus on ALL of the details that make ALL the difference.

This is all part of a powerful Identity—THE cornerstone to your marketing message. If you don’t have a powerful Identity to communicate to prospects, you’ll find it difficult to crush The Undercutters.

2. The “Nanna” Philosophy

Psychological studies show that a consumer is more likely to buy from a person/company they like than one they don’t.

This seems obvious. But it’s difficult for many remodeling companies to understand WHAT makes them seem likeable to homeowners.

There’s a surefire way to make every prospect love you: take on every project as if it were your dear old grandmother’s.

If you sat down with your sweet little nanna to discuss remodeling her kitchen or installing new windows, how would you treat her?

Like the Queen of England, naturally.

So why not treat EVERY prospect like royalty?

Be a homeowner advocate. Educate them instead of selling them. Answer all of their questions (no matter how silly) with a smile on your face. Give them your cell number during the estimate, and tell them to call any time—day or night—with a question. Heck… have a box of dog treats stashed in your truck to give to your prospects’ pooches.

Bottom Line: Make the appointment—and overall project—100% about them. And kill them with kindness.

Yes, tell the prospect how and why you’re better. But do it in a way that shows how your greatness benefits them, Them, THEM.

3. Look The Part

People judge books by their covers. Period.

This natural human instinct gives you a huge advantage over 99% of Undercutters.

Most Undercutters are one-man shows who work out of their 15-year-old unbranded Chevy Silverados.

Their dashboards have papers scattered all over. The contents of their truck beds look less like they’re carrying expert equipment for a remodel and more like they’re hauling junk to the dump. And the rust forming around the tire wells doesn’t exactly scream “professional business.”

A professional appearance subconsciously communicates quality. Your clean company truck, nice button-up shirt, iPad (for presentations), branded brochures, and modern website all play a part in convincing prospects you’re going to do the job right.

After all… if you put that much effort into your appearance, why WOULDN’T you put the same amount (or more) into a customer’s project?

4. Tell Prospects You’re Here To Stay

Let’s be honest: Undercutters can’t possibly be turning the type of profit to be financially stable.

And we all know what happens as a result: Undercutters go belly-up left and right.

Industry estimates show that 50 to 60% of contractors go out of business within four years of opening. And, naturally, the overwhelming reason is because these businesses didn’t make enough money.

Honestly, you can’t know for sure how well an Undercutter is doing financially. So don’t actually tell prospects an Undercutter probably won’t be around in a few years if warranty work is needed. (You don’t know, after all.)

Instead, make it abundantly clear that YOU are financially stable. You’ll ALWAYS be there—5, 10, 20 years down the line—if they need something.

This is when you bust out things that prove you’re on firm ground: Years in business, number of customers served, how much experience you have, and so on. Beat it into the prospect’s brain that you’re as reliable as Michael Jordan in the NBA Finals.

By doing so, you give them peace of mind Undercutters cannot possibly provide.

Want More Ways To Improve Your Close Rates?

If you want to boost your close rates and land more jobs, I’ve got the resource for you.

The MYM blog contains numerous articles about improving your closing percentages. Go here now and consume every morsel of marketing goodness they provide: https://mymonline.com/mymblog/tag/pre-positioning/

 

Thanks!

 

-Rich

 

 

© 2018, Rich Harshaw. All rights reserved.

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