HOW DO I COMPETE AGAINST THIS? $25 per hour max 2 hour charge...

[EzPSA]

Ignore people like that, they have a market, its probably not the market you want. Just offer your service at a realistic rate and you will get much better clients and have time to sleep and do other things. We all know that generally the cheapest is not the best and if I was searching for a tradesman to install a new shower I am not going to go with the cheapest because chances are the quality will be poor and I would rather pay more and get the job done right the first time.

When starting a business it is easy to focus on the competitors and they will do you head in if you are not careful. Know about them, listen to what the market is saying, but don't give them air or let them worry you. Concentrate on what you bring to the table.

If you plan to advertise in the same paper you could sell your services differently you might say that you are not cheap but offer high quality fast service (or something different to what the competition are offering).

[IAMPC]

Originally Posted by gunslinger

So because this guys does not charge $100+ per hour he does not know what he is doing? Wow. I guess those guys at best buy must really know their stuff.

Would you take your car for engine repair to someone in some shop in the woods who is charging $100 when all legitimate business around you are charging $500 and the dealer ship is charging $1000? I know I wouldn't, I wouldn't take it to overpriced dealership (Geek Squad) but I would not trust a $100 guy in some home garage either...

If you say yes, then you are a typical Craigslist browser...

[red12049]

Originally Posted by gunslinger

Hmmm, so, why is everyone so pissed off about this guys rates? The only people who should be complaining are people who are over charging.


******************************************
QUICK COMPUTER FIX
15 Years Experience
Any PC Problem has a solution
Can pick-up or drop off
Fix it there or fix it here - No fix - No pay
$25 HOURLY RATES - More than 2 hours wil be free
Contact XXXXX
*******************************************


What exactly is wrong with this? The only two things I do differently is I charge $35 per hour and I don't do the 2 hour free fix deal. I do offer pick-up or drop off. I also offer No fix - No pay. I also end up taking a lot of business away from the other shops because of these things.

The problem when your differentiator is "lowest cost", or close to it, is that it's a self imposed limit. When all your time is taken, that's your income. Period. Can't afford to hire help, because your hourly rate is too low. Raise the rate, and what makes you different from your competition?

If the income you have is the only income you'll ever want, and there are no external forces to change anything around you, that's fine. But chances are that won't always be true. And it's a very hard hole to dig out of.

Rick

[gunslinger]

Originally Posted by IAMPC

Would you take your car for engine repair to someone in some shop in the woods who is charging $100 when all legitimate business around you are charging $500 and the dealer ship is charging $1000? I know I wouldn't, I wouldn't take it to overpriced dealership (Geek Squad) but I would not trust a $100 guy in some home garage either...

If you say yes, then you are a typical Craigslist browser...

Actually I did something like that once. I took my car to the dealer first and was charged over $700 for the problem not to be fixed. Later I paid this old guy who lived up the road $50 and he not only found the problem but fixed it.

Just because someone charges a large rate does not mean they are worth it. All it means is they have convinced someone they are. Check out the latest computer America pod cast where Carry tells about the "tech" who charged $1,300 to hook up a router.

The problem when your differentiator is "lowest cost", or close to it, is that it's a self imposed limit. When all your time is taken, that's your income. Period. Can't afford to hire help, because your hourly rate is too low. Raise the rate, and what makes you different from your competition?

If the income you have is the only income you'll ever want, and there are no external forces to change anything around you, that's fine. But chances are that won't always be true. And it's a very hard hole to dig out of.

Rick

I make a good living. I think you have to know what you can charge in your area and stay up and running. We don't have a best buy around here and the highest the bigger shops charge is $50 per hour. There have been a few guys try $70-80 per hour and went out of business quickly.

[Hampden Comp]

Pricing tends to be very market specific, dictated by competition and at the end of the day how you want to structure your business. Fair pricing and honest customer service goes along way with building a solid customer base and word of mouth advertising can't be beat.

[gunslinger]

Originally Posted by Hampden Comp

Pricing tends to be very market specific, dictated by competition and at the end of the day how you want to structure your business. Fair pricing and honest customer service goes along way with building a solid customer base and word of mouth advertising can't be beat.

Exactly! I'd say I get about 80% of my business from word of mouth advertising.

[MobileTechie]

The reason people get pissed off with low raters is obvious - it puts a downward pressure on rates in the market and who wants that?

It would be so bad if they were running legitimate businesses, paying taxes and using a working business model but most of the time they are not and they are playing at being in business. Sure they often go out of business in a few months but others constantly appear so to the consumer they appear to be a valid comparison.

I can't see that anyone can make even reasonable money at $25/hr capped a 2 hours whilst running a vehicle and paying taxes and accounting for travel time and dead time and so on. It just doesn't work. Also even being the lowest rate does not remotely mean you get all the business out there. People shop in many different ways and many never even find out about you before making a decision.

But as long as people are actually registered, paying taxes and offering a good service they are free to charge whatever they like.

[JosephLeo]

Simple solution, look at what the barber shops do. No really, look at them.

A new Barber opens up and advertises "$10 Cuts - 7 Days a week!"
An old barber shop who charges more than double will have to compete with that, but how!? Simple, "We fix $10 Haircuts!"

It's called Geurilla Marketing and it does wonders for small businesses competing with large corporations who can afford to go cheap, and is pretty effective against the "El Cheapo's"

[Benchtech]

Originally Posted by JosephLeo

Simple solution, look at what the barber shops do. No really, look at them.

A new Barber opens up and advertises "$10 Cuts - 7 Days a week!"
An old barber shop who charges more than double will have to compete with that, but how!? Simple, "We fix $10 Haircuts!"

It's called Geurilla Marketing and it does wonders for small businesses competing with large corporations who can afford to go cheap, and is pretty effective against the "El Cheapo's"

Have fun on your trip JL.

After reading a TON (no literally I think I found this site like 6-7 days ago and have found a wealth of knowledge on here stayed up 24hrs the first night reading everything I could by Bryce and the business sections) I've come to the conclusion let the $20/hr pizza tech's work it out between themselves, I'll be priced exactly where I want to be which is about 20% less than the big guys in my area and well above the lo-techs. I have 13years of real world experience and still don't know everything about the industry (any one who does is lying or is at the fore front of tech) I learn everyday. The difference between myself and many others is I NEVER give up, I've made mistakes that I have learned from and made myself better not only for me but for my clients as well.

I landed my first business client after coming in behind a Pizza Tech that lives about 4 blocks from me. They are thinking about taking him to court because he damaged their server (he infected it on purpose, I got the logs to prove it). Anyway neither here nor there.

Thanks everyone for this wealth of info.

[ConroeTech]

I listened to a podcast at podnutz on this issue. You have to set your prices where you think you will make money without just breakin even. I tell my customers that if "price is your only concern, then I may not be the best solution for you. But if quality is more important to you, then I'm your man". It works many times for me. Many of the people who are only concerned about the price may end up being one of your biggest headaches in the future. They are the bottom dwellers and usually aren't worth our time in the shop.