Pricing is always a thorny issue, I bumped into Squeaks in our local Tesco car park earlier, we didn't chat much cos I had 'Er Indoors' by my side and she wanted to go home
But we were discussing prices.
Upshot was that Squeaks thinks I am ripping my customers off (I have one every weds that is £55.00 per clean and it now takes me 1 hour 15mins.
Rog says, 'Your'e ripping them off!!
'
But my price is identical to the previous window cleaner and they were taking 2 hours to do the job.
Just because you are quicker is no reason to lower your price! This is how you make more money!!
Lets take it down to your standard semi detached house; by and large this will take the average window cleaner about 20 minutes to clean, a newbie will not do it this quick, this will still some experience to get up to that pace.
Now all of you experienced guys will also know that it can be done far quicker than this, if you can get it down to 10 minutes you are flying (I'm talking trad here by the way)
I personally hold that you should always price up your work at how long it should take an average window cleaner to do.
For instance, in the building trade there are reference books (Sponds used to be one when I was in the game) that mean that you can price up work by looking at the plans, everything is standardized.
So if we have priced up work going by times that your average, skilled window cleaner can do then you are not far wrong.
what you believe you are worth per hour is up to you.
For arguments sake, lets say you have priced up you standard semi at £8.00 (as a unit price this is roughly average)
Potentially your Mr Average can do three an hour, but the way you make your money is by being able to do 4 an hour, or even 5.
So if you have enough of them grouped together, and you are skilled enough to be able to do 5 in an hour then you will have knocked out 40 quid.
Lets also assume you have also done a top class job.
does this mean that you are now ripping off your customers because yo uare earning £40 per hour?
Or should you chop your prices until you are down to £24 per hour?
This will now make your competitor across the road (who can only do 3 an hour look vastly over priced, but he isn't is he? He is still earning the same per hour as you are.
It's you who are the numbnuts for lowering your prices
When (or if) you transfer to WFP then you will be considerably quicker again, particularly on larger accounts or accounts with georgian or leaded windows, but if you drop your prices you are making a mistake, you are reducing your possible imcome (at against increased overheads and vastly more expensive setup costs)
And another thing you must remember is that you are not actually earning £24 per hour.
Look at your bank balance and add up what you've paid in over the last 12 months.
THAT will give you your real turnover.
Take off your overheads, they are more than you think.
remember also that your business itself should also have a profit at the end of the year for future investment and so on.
what is left is your income for the year, and it won't be anything remotely close to £24.00 per hour.
If your tax bill is piddling, then your true income is peanuts, unless of course you are conning the tax man and fiddling your accounts.
So how much do yo uwant to earn?
And by that i mean what kind of a wage do you think you are worth?
A student teacher, after training will be on roughly 20k per year (think of the holidays!!
)
Do you reckon you are worth that much per year?
Well if you do then your business had better be turning over 25k and above (minimum)
When you look back on your years turnover (money paid into the bank) you are going need to be showing close to £600 per week (especially if you are WFP)
don't kid yourself that you do this all the time, those accounts you submit to the tax man tell you the true tale.
When you consider that most of us only work about 5 or 6 hours a day even on a good week in the summer you really do have to reassess your hourly charges.
According to the tax man, the average window cleaner turns over approximately 17k per year.
you can lop off about 4k in costs and overheads, and that also allows for a very modest amount left in your business at the end of the year.
Your income - YOUR WAGE - is going to be as low as just 13k (not that you'll be paying tax on that amount, you have your various allowances to come off that)
Are you happy with such a modest income?
And don't forget, if you are WFP and only turning over that much, your income will be lower again.
So armed with this fresh knowledge, have another think about how you should price things up.
And have the confidance to go in a lot higher than you are now.
If you want a decent income then you just have to.
I know it depends also on your location in the country, some things you can do little about unfortunately, but once you believe absolutely in what you are charging, and you also know you are delivering a first class service then this transmits itself to your potential customers.
And even if you are belting out the work in double quick time, you should aslo feel safe in that the price you are charging is a fair one for the work being done...and if you are now WFP...this is also one of the single biggest reasons for making the change!!!!
Ian