It’s no secret that with the Internet, buyers have become more knowledgeable price-shoppers when purchasing anything related to a pool.
I’ve received back-to-back phone calls from my service/retail franchisees about unhappy customers who felt they were being overcharged because of the lower equipment prices they find online after the fact.
Even if the sale has already been made, once the homeowner sees the product in his or her yard and has the manual in hand, they get curious about what they just purchased. In the course of their follow-up research, they’ll inevitably find a bargain-basement price from a guy wearing a bathrobe in his garage, halfway across the country.
We know that rock-bottom price doesn’t include necessities like installation, materials or someone to fix the product when things go wrong. But the consumer may not take that into consideration.
Looking at unhappy customers’ invoices has led me to think the problem lies, in part, in the perceived price of the system itself. Often, pool professionals will charge too much for a chlorine generator or robotic cleaner, yet not enough for the installation. The customer can’t understand that you charged him less for labor than you should have. Instead, they only see the black-and-white charge for the product itself, and compare that to the price online, which doesn’t include anything but what’s in the box.
But there is more than one solution for that sticker shock. You can keep approximately the same profit margin on a piece of equipment by breaking down the cost differently. By charging a larger amount for the installation, you can assign a lower value to the product itself, reducing the gap between what you’re selling and what can be found online.
What has worked for us, though, is flat-rate pricing. A total package on the bill that includes the cost of the product, labor and materials without breaking down each aspect eliminates putting an exact price on the system. It can also make clients feel that they’re getting an all-inclusive deal. In addition, taking hourly rates out of the equation is a nice bonus for the customers, who won’t feel miffed if they see their service tech taking a break.
Also, remember that dedicated pool professionals not only have a leg-up because of their relationships with suppliers and manufacturers, but we can also offer certified warranty work and extensively trained personnel.
Eventually, the buyer will call you to install, or fix, the system they bought online outside of the warranty. This will end up costing more than the $200 they originally saved. If you protect them from that in the beginning, it’s better for them as well as for our industry’s reputation and survival.