Responding to Competition-Part 3
A third area you need to consider is price. I don’t like talking about price because studies show that price is usually not the first issue people have with a service company. I want to warn our readers to avoid the siren’s call to lower prices. Now if you discover a better and more efficient way to do your business then by all means lower prices if competition forces you. The key is not to reduce your profit margin. The fact is anyone can lower prices. The danger to this industry lies in the hands of the low ballers. These are the guys who travel twenty miles for a squirrel and only charge 20 dollars. Even if you are loosing business to these guys try to fight the urge to simply lower your prices. Instead, try to add value to the price you already charge. You can add value by extending or establishing a warranty, have insurance, have workman’s comp insurance, that you are a Certified Wildlife Control Professional etc. Do and say things that show your potential clients that you don’t charge low prices because you don’t do low price quality work. Show your clients that you are more expensive and like the Loreal commercial, you are worth every penny.
I cannot stress enough that price is not the key reason why most clients go with one service provider over another. (Most customers go with the first company that answers the phone but if that doesn’t do it, then customers decide on satisfaction). In my reading, a key reason why people choose one company over another is peace of mind. In other words, if the client hired you do they feel like they have made a safe choice? The scariest thing for a client is the feeling that they have hired a loser company. Unlike the experience in buying a product, a customer can’t return a service. You have to overcome the customer’s fear of hiring the wrong customer by giving them some level of security. If they can’t find it, they will then go to the lowest bidder to reduce their potential loss.
Finally, prepare for coming competition. As I said in the first paragraph, the industry is maturing. As much as you hate to admit it the easy money has been made. The rise in competition should force everyone to start treating their work as a business rather than a paid hobby. If you have an established business and the new guy on the block is beginning to take a bite out of your customer base, don’t panic. The business community is littered with the wreckage of fast growing companies that came in bragging how their business model would destroy the competition. The fact many new companies look great at the beginning. But the realities of heavy hours, dead beat clients, and bills quickly take their toll on these upstarts. The principle you have to keep in mind is to always run a lean operation that is ready to adapt and survive during the initial slow period caused by a new company. For more often than not, that new company won’t be able to maintain their hectic pace for long. When and if they burn out, you will be to pick up the pieces and the profits.
There is certainly a lot more that can be said about preparing and responding to competition. However, I think you have seen enough to begin thinking about how you might handle that eventual occurrence or might respond to it if the competition is already upon you. Remember, if business was easy, everyone would be doing it.
About the Author
Stephen M. Vantassel is a certified wildlife control operator who helps individuals, businesses, and agencies resolve wildlife damage issues through training, writing, expert witness, and research. His latest books are the Wildlife Damage Inspection Handbook, 3rd edition and The Practical Guide to the Control of Feral Cats. He can be contacted at wildlifecontrolconsultant at gmail dot com.
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