The vehicle wrap industry has been affected just like any other by a sluggish economy. Jobs are disappearing, causing more people to go into business for themselves. Vendors in our industry have made it attractive for more people to join the vehicle wrap game, causing prices to fluctuate greatly within the industry. 

 

How do you battle this? How do you handle a situation where you have to compete on price in order to get the job? When economic times are tough, our customers care less about who you are and more emphasis is placed on where you are (in price, that is).

 

When pricing for a customer, be sure you understand their budget before quoting. Shooting them a price on a full wrap when they can only afford a partial may cause sticker shock and scare them away for good. Communication is key at the beginning of your sales process because you don’t want to be perceived as the most expensive from the beginning of the relationship. Understand that most customers will get multiple quotes, and your understanding of their needs at the beginning of this process will help your close rate substantially.

 

When a potential customer asks you to beat a competitor’s quote and it’s substantially lower then what you quoted, first thing to do is not panic. You do not need to drop your price right out of the gate to get the job. Before dropping your price, you need to address some simple pricing fundamentals. The first question you need to ask yourself is do you intend to make a profit from the work you do. If the answer is yes, you must price for profit.

 

Customers want the best price they can get, especially in a difficult economy. How do we as professionals keep our prices at numbers that cover costs and maintain profit margins without discounting? We really have two options: Walk away from the deal if the customer does not see the added value of doing business with you, or you can figure out a way to communicate your key differentiators that warrant the additional investment.

 

How many times have you worked with a customer who wasted your time and energy? You would have been much better off moving on to more qualified prospects. But there are customers worth working with, ones with whom you can help understand the difference between price and cost. Price is what they pay for the wrap; cost is what the investment is over the lifetime of doing business. Can you help your customers grow their business with a car wrap? Have you ever wrapped a vehicle for a customer where the end result made them a lot more money than the wrap cost them? Have you ever wrapped a vehicle that gave your customer a competitive edge in their industry?

 

How many of you have had customers leave because of price but come back because the level of service they received from others was not what they got from you?

 

It is your job to educate your potential customers on the strengths of your company. Why the client base you have now is loyal and why those few extra dollars spent are valuable. You are always going to find someone out there who is willing to do the same work for a cheaper price. Don’t worry about that; working with customers who understand the value of working with you and are willing to build a long-term relationship is where you need to focus your efforts.

 

It is important to have a conversation with your customers and prospects to uncover what their real needs are. You should never begin any meeting with a pitch about the features and benefits of your product and company. You need to figure out if a wrap is really the solution to their problem and how much of the vehicle should be wrapped to solve this problem and fit their budget. We have all quoted to that customer who thought a full wrap was $500. Without an upfront conversation, we will lose this prospect forever. Get to know the prospect; adding a personal touch may overcome some pricing issues. People do business with people they like.

 

Once you’ve had your good rapport-building conversation and earned the opportunity to continue with the quote, telling them the benefits of your product and company can still be met with skepticism and a pair of arms folded across their chest. The key here is to ask strategic questions that, with the answers they give, will sell the value that you know you can provide. With their answers, you can now speak freely about your company and products without any resistance from them. 

 

Support your quote with client testimonials. In a 2009 survey of online consumers, Neilson found the more a testimonial is viewed as coming from a peer, the more it will be trusted. And when coupled with a strong statement of benefit, the more likely the prospect will be to take action. Testimonials are a great way to overcome pricing problems when selling wraps. The more targeted the better. If you are not asking your customers for testimonials, start immediately. If the quote you are sending is for a paint contractor, send a few testimonials along from other contractors that speaks directly to the quality and effectiveness of your work.

 

Be sure the price you are being asked to beat is supplied to you in writing. Make sure you are comparing apples to apples. Look at the materials they are using, look at design, installation, time and methods. If you have had a great upfront conversation with your prospect, you will be able to explain any problems with the competitor’s quote. You should have enough rapport built by now to explain why the project needs 10 hours of design instead of the three hours quoted by the competition. 

 

When dealing with the customer, think about what is unique about you that fits the customer’s needs and expectations. This will be the key in closing the deal and not worrying about price. Does your design style match the customer’s needs? Can you handle a difficult install better than the competition? Does the customer require special color needs that you are able to provide? Any angle that separates you from the lower bid will help open up a conversation on value and benefits.

 

Education is the key to overcoming low prices. The more you help them understand what a vehicle wrap can do for them, the better decision they can make. Find ways to educate them. People often pick a lower-priced wrap because they can’t see the differences. Show them the differences by educating them.

 

Be careful that your educating efforts are not thinly disguised sales efforts. People know the difference. When you offer to educate but you try to sell instead, you chase people away. They will not trust you because you’ve misled them. Don’t sell when you’re trying to educate.

 

It is frustrating when you are asked to match or beat a low quote. As frustrating as it is, never slam your competition. Use true but unflattering labels to position your competition as a less desirable option than your company. For instance, a larger wrap provider might be headquartered in another state. If your prospect values doing business locally, you label your big competitor as “that out of state” wrap shop. If you have a smaller competitor that works out of their home, maybe you label them as a “home-based business”. 

 

The purpose here is not to slam your competition (even though they might deserve it!) Your purpose is to position your company as a better choice in the eyes of your prospect or customer. Your true but unflattering label should bring to the surface information or traits about your competition that your prospect might find undesirable. 

 

Remember, the customer buys based on their perception. They will develop a perception of you and your competition one way or another. You can influence their perception by labeling your competition.

 

If you are the shop that is giving out cheap prices, remember this: Cheap prices attract cheap customers. I don’t quite understand why this phenomenon occurs, but cheap prices always attract super cheap customers. You would think that already rock-bottom prices would discourage a customer from haggling with you, but the opposite is true. Lowball prices encourage customers to try and lowball you some more.

 

If you find that your business is dealing with a high percentage of pain-in-the-neck cheap customers, then chances are you need to raise your prices. You’ll have to experiment for a while, but once the cheap customers go away, you’ll know that your pricing is at least in the ballpark of what you should be charging. Most people who say they want a low price are really saying, “I want everything, and I want it at the lowest price I can get it for.”

 

Pricing is a tricky game, especially in the vehicle wrap arena. We all have different overhead that can determine where we need to be when selling a wrap. Wrap prices vary greatly depending what region you do business and the amount of competition in your area. If you don’t know where you should be, simply shop your competition. With just a few phone calls you will be able to determine if your price is too low or too high. Some ballpark numbers to start experimenting with also can be found on page 52. 

 

Can you be profitable at the price the customer is demanding? Are there any other benefits besides profitability that attract you to take the job for a lower price? Some customers will not care who you are, what materials you use or how long you have been in business; it’s all about the bottom line. At the end of the day, the decision is yours; will pricing drive your business?