How to charge?

N

neighborsenvy

New member
I searched and cant find this brought up before.



Some background: I used to do mowing for two summers several years ago and realized that it wasnt for me. One of the forums I went on always said "no lowballing". Always said to charge a decent price upfront instead of undercutting everyone else.



I want to get some business and have been passing out postcards that advertise the following prices:



-At home exterior wash: $20 ($30 after 7 days of receiving the postcard)

- Wash and wax $50 ($75 after 7)

- Wash, Wax, and clay $75 ($100 after 7)

- Wash, wax, clay, and polish $150 ($200) I know this is too low but wanted to get a few complete details



Are these in the ball park of other people? Note: I am just starting out and am doing this part time only. I probably have about 4 years til I can feel completely comfortable leaving my job as I want to have my car paid off and to have enough income for 1 year worth of bills/living expenses saved.



Ive passed out about 100 of these to homes in my neighborhood and also to about 15 cluster boxes for townhomes. Each cluster box has 12 addresses. I only had one call and only 5 visits to my website (I use statcounter.com BTW). That call has lined up a weekly wash/monthly wax for a 2010 black corvette gs though.



Ill post up pics of the cards soon but I think they are extremely professional. Thought I would get about 5 calls or so.
 
WASH, CLAY AND THEN WAX! lol just do a good job on that corvette, be super cool with that guy, u gana have business just don't push it and dont be afraid, practice and practice until you'll be sure, then practice some more.
 
Yeah, sorry, I was just listing the services not the particular order. If I thought I was supposed to wash, wax, then clay I would be better of detailing with a blindfold lol.
 
It really gets down how much do you net an hour to determine the price. If you use a machine to polish, you should charge more per hour since it is more skilled. For example, if it takes you an hour to do a wash, you have grossed $20. Then subtract supply costs (soap, wear and tear on supplies), etc. Are you working for cash or do you have a business license, insurance, paying taxes, etc?
 
$20 for a wash & $50 for a wash & wax That's pretty cheap. I strongly consider you use the most cost effective products possible. Are you dressing the tires for $20? Might be a good way to get in the door and concentrate on upselling as much as possible. You might want to consider offering a package to the wash takers. Something like "I'll continue to honor this low price if you agree it as a weekly service".
 
The $20 and the $50 is just for the first 7 days after I pass out the card after that it goes to $30 and $75. Yes, that does include dressing the tires. I think $30 is good for a wash but what is a normal wash and wax for most people? My target customer base right now live in homes worth $250-$375k. Most cars are late model maximas, altimas with the occasional BMW/MB
 
neighborsenvy said:
Ive passed out about 100 of these to homes in my neighborhood and also to about 15 cluster boxes for townhomes. Each cluster box has 12 addresses. I only had one call and only 5 visits to my website...Thought I would get about 5 calls or so.
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That's about right. Typical success rates of direct mail like this iare only 1-2%. To get the most bang for your buck you should be hitting those same addresses ~6 times a year. Most people don't act on an ad until they see it three times, and that's only if they like it.



If you haven't already you might want to check out, "Guerrilla Marketing" by Levinson
 
50 bucks isnt bad for a wash/wax on a corvette because it's a pretty small vehicle. Be sure to add stipulation based on vehicle size though so you don't short yourself too much.



150 for machine polish also isn't outrageous if it's a single step polish, but if you're doing multiple steps then I would definitely increase your pricing (even over the 200 mark).
 
I didnt include the special pricing for the vette. Its $45 a week for wash, dress, and interior. $80 for wash, dress, wax and interior(wasnt thinking when I quoted the price to the guy as I wanted to charge $90). The car isnt a DD and is garage kept so I figure It will be about 45 min to clean once I get the system down and maybe 1.5-2 hrs for when I wax.



I would like to get to a point in the next 5 years or so to be able to charge $500+ for an 8 hour correction. I will not be trying to compete with existing detailers but to put out the best possible work I can every single time. I know I will be successful if I am: honest, keep my word, perform extraordinary work, and fully communicate with every customer.
 
neighborsenvy said:
I know I will be successful if I am: honest, keep my word, perform extraordinary work, and fully communicate with every customer.
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wrong !

u will be successful if u think first as a business man not as a detailer.
 
CosminTX said:
wrong !

u will be successful if u think first as a business man not as a detailer.
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Exactly. This is where accounting comes into play well. Easiest advice, examine your costs (rent, products, utilities) then examine your revenues per detail. Now subtract your costs from your revenue, is your number positive? Also, how many hours did it take for you to come to that number? Per package, how much would you be making, and which one is most profitable per hour spent? While the full detail sounds good, if you are spending quite a few hours doing it, and only end up making like $5 an hour vs $20 per hour on the basic clean, you might want to cater more to the basic, and up that price slightly and try to shy away from full detail. I know i may have butchered what i learned in accounting, but i hope it helps some.
 
Coming from an accountant--Smok you more or less have it.

Depending on your business setup (legit or not) you then have more to account for.

Simply put--you need to figure out your fixed costs (insurance, rent) and what your variable costs look like ($ amount of product used, utilities) Variable costs quite simply are the costs that directly change per detail; the more cars you detail the higher your water bill gets, and the more times you have to order products. Somewhere in there, if you are going the legit business route then you need to account for taxes and stuff of that nature.



Honestly speaking--I would probably make up a spread sheet and try to figure out all your costs (oh and what you charge per hour of labor should be in there somewhere whether you explicitly list it or not; if you don't CHARGE labor per hour, it would still be a way of keeping track of how efficiently you work per job)



Providing the discount to your neighbors could prove helpful to you--but as you start crunching numbers--you might have to adjust your marketing strategy.
 
Alexshimshimhae said:
Coming from an accountant--Smok you more or less have it.

Depending on your business setup (legit or not) you then have more to account for.

Simply put--you need to figure out your fixed costs (insurance, rent) and what your variable costs look like ($ amount of product used, utilities) Variable costs quite simply are the costs that directly change per detail; the more cars you detail the higher your water bill gets, and the more times you have to order products. Somewhere in there, if you are going the legit business route then you need to account for taxes and stuff of that nature.



Honestly speaking--I would probably make up a spread sheet and try to figure out all your costs (oh and what you charge per hour of labor should be in there somewhere whether you explicitly list it or not; if you don't CHARGE labor per hour, it would still be a way of keeping track of how efficiently you work per job)



Providing the discount to your neighbors could prove helpful to you--but as you start crunching numbers--you might have to adjust your marketing strategy.
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:werd:



Could you say water bills are a mixed cost along with power? Because you still have to pay for the hook up, but then on top of that you have to pay for the amount you use.



And thanks for cleaning up what i had to say. I was gonna try to explain it like yours but it just wasnt coming out right.
 
smoknfastlegend said:
:werd:



Could you say water bills are a mixed cost along with power? Because you still have to pay for the hook up, but then on top of that you have to pay for the amount you use.



And thanks for cleaning up what i had to say. I was gonna try to explain it like yours but it just wasnt coming out right.
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omg... i erased my explanation...sigh ok first off I will sincerely apologize if anyone get upset, annoyed, or offended, but I'd like to put it out there that I'm by no means a Pro detailer--this thread just happened to catch my eye--I'm simply putting my two cents in from an accountants POV. Also, I guess just to be safe--anyone reading this should refer to the laws and regulations that apply to their respective areas, and speak with a professional to be sure =].



Water costs were a for instance to try to get explain a basic difference in the costs to account for. It would entirely depend on the way that he does his business. If he does the work at the clients house, does he use THEIR water? or does he have a tank loaded up with water that he uses?



Quite simply, FIXED costs, are those costs that remain the same regardless of the volume of business that he does. For instance, insurance payments stay the same whether business does 100 cars or 4. The caveat to this is the more business you do, the less fixed cars are PER detail (so if your insurance is $10, and you detail 2 cars, then $5 each would be allocated as fixed costs per car, but if you detail 10, then its $1 per detail)



VARIABLE costs have a direct connection with the volume of business you do. For instance, the more details you do, the more products you use, the more pads you have to order, the more gas used to get from place to place(if you go to the client), the more electricity you use etc. The caveat to this is though prices for each car remains the same; and what i think smoknfast is referring to are the costs that involve for instance the setup of the resources. I mean, I don't really know how intricate you get with your accounting (certainly, the tax laws that apply to your areas may effect the way you account for different things) but I mean if it's a one time thing, and it's not significant in costs, more than likely you would just expense it. If it's something you have to do pretty much every job, then it may depend on the accounting methods.



But I mean, again it all completely depends on what he does, because I mean, if this is more of an under the table operation, then I mean, for simplicity reasons, I would probably try to simplify it a little bit--roughly how many cars till you run out of x product, how much was that product etc..



If he IS actually going a registered business route, then I mean...IMHO it might very well be more cost efficient to maybe talk to a tax professional for instance even if it's just to clarify what expense to account for and maybe how to account for them; that way you may have a better shot at getting as many deductions as you're rightfully entitled to.



*edit*

And sorry, this one ended up actually longer than the original...if you get confused lemme know i'll try to cut down to more minimal stuff and maybe clarify what you need
 
This is all very good advice. I will definitely break all of my costs down to see what I am really making.



At this point, successful would be having 2-5 people a week for wash and dress. But until I know my true cost then it doesnt matter how many people I have.



Is there any book you would recommend for reading?
 
Alexshimshimhae,



I understand your post completely. My friend is an accountant and will be talking to him over the fall/winter.



I would be looking to going as a legit business next year.
 
neighborsenvy said:
Alexshimshimhae,



I understand your post completely. My friend is an accountant and will be talking to him over the fall/winter.



I would be looking to going as a legit business next year.
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kudos-lol in that case the accountant would be your best friend to save on headaches.



In terms of pricing--after you account for the costs, I would then decide on evaluating how much you think your expertise and the quality of your services are. IMO, I'd much rather make the client feel like I appreciate him/her as a customer by throwing them freebees here and there for their loyalty, than to have to explain to them that the prices are going up because you have new clients now. (Though I'm sure no matter what there's a good chance things will have to change when this becomes your FT business)





Me personally, I kind of like the introductory coupon idea (I hope you made sure there was a way to tell WHEN each coupon was distributed because I actually got a flyer in the mail that said within 14 days...but there was no date or anything listed AND it seemed to be copied at a kinkos or something--so I could've just as easily made 100 copies and probably robbed them blind) Let them see the value of your work.



mmmm...as for book recommendation, don't know any off hand, but I mean...google/amazon search probably wouldn't hurt? (sorry I can't be more helpful)
 
oh and just a side note about the site--I would've liked to have seen a little more confidence and excitement when describing your packages. Just a thought.
 
Did you go to my site? I actually track that on a daily basis and there hasnt been any new visits that Im aware of. What I have on the site right now was put together in just a few hours. I needed something up right away for when I passed out the cards. I do most my shopping/services off of the internet. I figure if they dont have a website, they arent professional. I know thats not always the case though.m Im working on adding more pictures with the different services and rewording the site in the next 2 weeks when I pass out more cards.



When I get a chance Ill upload my cards. I think they came out great but my opinion might be a little biased lol.



The 7 day expiration isnt a hard date as I ordered 1000 cards like this and I only give them out little by little. Ive read in several ad books that you have to have a date to get customers to act. I am trying to get whomever I can at this point so I dont mind giving out a $10 discount if it means I get another customer and some word of mouth out of it. I actually might be doing a pastor's wife's car soon. That might open the door tremendously. Thinking of doing exterior only wash during church services if its permitted. There are 2 services and each is like 1.5-2 hours and can probably knock out 2 each time and there wouldnt be too much window time.
 
For your accounting stuff, look up managerial or cost accounting online, there are several sites that have information on it which should help you.
 
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