What do I get? (How to start charging on value)

This came up from a conversation that Wilson and I had after our check in with Logan…

Logan told he earned more money just in August than he would have in 5 months of pay at the job he left to start his business.  And here is the crazy thing, he’s only 3 months in.  (Click HERE if you haven’t seen that video yet)

So we were talking about something he’s doing incredibly well.  Charging on value, not on price.  This has proven to be successful in service based contractors (especially those that are more artistic in nature, like cabinet painting)…  and yet, so many people are in a rush to commoditize their service.

What does that mean?

Commodities are a product or service that is indistinguishable from ones manufactured or provided by competing companies.

And here is the reality – if all of your products are the same, the only thing left to compete on is price.

Which, as you can imagine, means the only way to win is to lower your prices.

It’s a race to the bottom, and the business owners lose.

It causes people to focus on price.

Instead, it’s far better to focus on the outcome.  We don’t quote our customers on a price per door, because we’re not competing on price per door.

There are lots of companies that will do it cheaper than us.

What you’re getting, and what we’re bidding on is a bit different.

1. The experience & customer service
2. The quality of work
3. Our reputation

They’re buying an outcome. 

Instead of:
“You’ll get doors painted for x$ per door”

“You’ll get a beautiful finish that you’ll love and can be proud of for years… combined with with crystal clear communication and customer support throughout the entire process.”

And here is the truth.  Some people want x$ per door.  Those aren’t my target customers… (I could go on an hour long rant on that topic alone).

However, one of the interesting things we’ve noticed is a lot of people considering cabinet startup want to commoditize the process.

“How many trainings do I get?”
“How much is each part of it?”
“What’s it cost for x?”
“How many tools do I get?”

And here is the crazy thing… those people are almost always the one trying to commoditize their own services.  (coincidentally, they’re also the ones struggling the most).

At ECC, we don’t sell a commodity, we sell an outcome.  Beautiful kitchens with world class customer service.

At Cabinet Startup, we’re not providing a commodity.  We provide an outcome.   A 6 figure business in under 90 days.  Just like we did for Logan.

(click the video to watch it)

So, here is the point.

Quit commoditizing your services, and start charging on value.


Steven Jordan


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