Some time ago, in the midst of a rabbit-hole internet search, I ran across an article about pricing jewelry repairs called Top 10 mistakes people make when pricing repairs. The title is pretty click baity, but the dirty secret of click bait titles is... people click on them. Somewhat to my surprise, the article contained some excellent points.
Now, this is the Repairtagger blog, and I expect you’re asking yourself what software developers find useful in an article about quoting repairs? Well, here at Roomify (Repairtagger’s parent company), we have been doing and quoting custom Web development for years. I also personally spend a fair bit of time hanging out at my Sister and Mother-in-laws awesome shoe repair shop (Saleigh Mountain Co.), and have had many discussions with them about how they price repairs and custom work. As it turns out, pricing one's time has some universal pitfalls, regardless of industry.
Here, drawing heavy inspiration from the aforementioned article, but modified for relevance, are 9 things that you might be doing wrong when you price repairs or custom work.
- Thinking of repairs as being price-sensitive the way manufactured products are.
Customers come to you because they trust you. Want proof? Answer this simple question: Out of 10 people who browse pre-made products in your store, how many buy? Maybe 2 or 3 out of 10? (This of course assumes that you also sell products on top of doing repair work.) Out of 10 people who ask if you can repair something, how many leave it? Probably more like 8 or 9 of those 10. This points to something that is not necessarily price-sensitive.
- Making the price up in mid-air and speaking it orally.
You: “That will run you about $45.”
Customer: “Gosh, that sounds like a lot, can’t you do better?”
If you hold your ground, that’s probably fine. What if you lower the price? Know what that means? You have to either work faster or spend more time on the job than you charged for, because you’ve lowered the price. The shop can’t make money this way.
Your second problem is: it’s coming out of your mouth. Something written down has a finality to it that helps people make decisions. Having a detailed price book allows you to point to a line and say “$85.00”. They will likely say, “Okay.” If the job isn’t something that you’ve got a price written down for, have a line that is your hourly rate - you can point to this and say “It’s going to take me 3.5 hours, our hourly rate is $80/hour, so the job will cost $280.”
- Not reviewing the accuracy of quotes you have made in the past.
You will get a sense after a while of how much time something will take you, and how much you should charge for it, especially if you’ve been in business for a long time. That said, we will periodically keep close track of how long something actually takes us, and compare it to what we charged for the work, and the difference between the two is sometimes an unpleasant surprise! It is rarely a pleasant surprise, as explained by #4...
- Underestimating how much time a repair is going to take.
People do not generally judge time well. If you are the exception, please teach me your ways! Fortunately, the solution is simple. If you find that you regularly underprice work, when a customer comes in: decide how long you think it will take, double that amount and multiply that by your hourly shop rate. It will feel insanely high to you at first, but you will quickly realize that you are much closer to your actual time spent!
- Telling the customer that you will call them back later with an estimate.
Whether it’s a repair or a custom job, there’s no real reason why you can’t price it now. Besides, the customer will lose their enthusiasm ... so strike while the iron is hot. They came in because they are prepared to do something about the item in question, take advantage of this momentum.
- Prejudging that a customer won’t pay for a repair because you’re worried that they will think the price is way more than the item is worth.
You have no way of knowing what is or isn’t worth doing for any given customer. Don’t go and charge $40 for fixing a plastic purse just because it’s plastic, if it will take the 1 hour you would normally charge $80 for. If you charge $80 to fix an $800 purse, but only $40 to fix an $80 purse, then logically you should charge $400 for the same 1 hour on a $4,000 purse. You may like the idea of charging more on higher items to make up for lower priced repairs. But charge consistently, you’ll come out better.
- Not quoting what the item actually needs because you think it’ll be too expensive
To give a pretty obvious example: There is absolutely no point in replacing just the soles on a pair of boots that also need a midsole, because you think that the customer won’t want to pay for all the work that is needed. You aren’t doing them any favors, and they will be back in your shop pretty quickly with their falling off soles!
- Not telling the customer about your warranty.
Believe it or not, you have warranted your workmanship, even if you haven’t specified any terms. Tell the customer you warranty your work; it will make them more confident about leaving it with you, and allow you to set the terms up front.
- Not offering your customers rush service.
Customers often want the convenience of while-you-wait or fast service, or have waited until the last minute for something they need “YESTERDAY!!!!!!!”. Your price book should have an “Express Service” column. Charge 50 percent more and do any repair while they wait, or within 24 hours. You may be surprised by how many customers take you up on it! Your time is valuable, and you have an obligation to the customers that brought their work in previously to not let someone jump the queue without paying a premium for doing so. Remember this excellent adage: “A lack of planning on your part does not constitute an emergency on my part.”