Hey Guys, I would appreciate any and all feedback on this.
Until this past week the economy has not affected my sales or my prices. This week I lost a lot of jobs because of price. It is too much so I know I need to lower my prices. Until now, this area has not been affected as much with the economic down turn. The homeowners I target are usually middle to upper class and they are starting to feel the pinch so I have decided to lower my prices. I have been one of the higher guys in the area, and up until now it has worked because I sell quality and have never focused on selling a price. I already have redone my books and have lowered my prices enough to make my price competitive with the others but still slightly higher. Heres the problem.
I figure everything on a job to a certain percent. A certain labor, materials, and overhead. Since I am a realativly new company (around 5 years) I focus nearly all the money I make towards going back into the company. I most likely pay different than most of you guys and I do pay very well for this area because I need to keep the good help. The only problem is now that with these lower prices I will be selling jobs at, the percentage of the job that goes towards labor will be too high and taking away from something else. I personally do not make that much. Only enough to pay my mortgage (less than 2 grand) every month but the company does pay for everything in relation to the company itself
I do not want to let anyone go and I do not want to tell my guys I need to pay them less but I am worried that I will not be able to sustain as well as I have been if something does not change. I am not afraid I will go out of business because of all those jobs I lost to price most of them said they wouldve gone with us because of our presentation and time spent wit them.
Have any of you guys had this situation happen already? If so, how did you deal with it? Also, how do you pay your men or women? Hourly, Salary, Square? I have been charging 330 a square for one layer walker tear off. That was the upper middle price of this area. Some were as high as 360-370 and some were around 240-250 but those are the guys who never get seen again.
Just any ideas on how to make it through this economic storm? Some of you have been business long enough you have already dealt wit this. I havent. I wish the Gov’t would quit telling people to be scared spending money.
Thanks for the help guys.