Welcome to a special series on starting a business! We have consulted with Matt Wheeler, co-owner of All Seasons Window & Door Co. in Charlotte, NC as he recently took over the business when the original owner, Bob Blanton retired. We asked Matt to share his tips and tricks with us in this 3-part guest blogging series. Here’s the first installment:
All buildings need windows and doors and people need these to be installed. Many people are also opting to replace their windows and doors to become more energy efficient. Windows and doors are also one of the ways in which homeowners can customize or decorate the outside of their home. It should be clear that window and door installations are a lucrative business opportunity.
Once you have decided to start your business and completed all the necessary training, steps, and licensing, you need to look at pricing. You will not be the only person in the business and you will have to compete with guys who have been around longer than you. Pricing is one of the ways in which you can set yourself apart.
Consider the following factors when doing pricing for your business:
1. Do some research on the competition
The first step to determine what pricing will be best is to find out what your competitors are asking. It is important to get a few companies’ prices so you can establish a price range. You should avoid just taking the competitor’s prices and making yours lower. This could do you more harm than good in the long run. Rather use the information to set a baseline and standard price range in which you can work.
2. Use your costs of business to do pricing
You can also do cost-based pricing. You take all the costs that go into your business and add them up. Things like overheads, materials, gas, labor, etc. will all be included in your calculations. Decide what profit margin you want and base your prices on all these costs. Cost-based pricing could set you apart from other businesses if your prices are higher because of higher quality products and materials.
3. Think bigger
You can use volume pricing for when it comes to large numbers of windows and doors. Offer a discount or lower profit margins to companies that order large numbers and companies that order often. You will make more profit and have continuing business this way.
4. Use promotional pricing
You can use promotional pricing to introduce your business to the community. Run a discount or special that will make people want to try your business out. If you do well, you may have a few return customers. You can also use promotions to introduce and advertise new ranges or new and improved products.
5. Consider expanding
Once your business is up and running, you can consider expanding your services or adding something. For example, you can sell products that will help with the maintenance of the windows and doors that you install. These add-ons can create a larger income and will add to your reputation as a good businessman.
Pricing can sometimes be tricky, but you will soon know what works and what doesn’t. You will often find that people in the same line of business like to offer help and advice. If you are unsure about some things, get online and do some research and find someone in the field to help guide you.