Are you working just as hard as you were a year ago, but not seeing the returns that you should be? How come?
Today, the buzz is all about Luxury Vinyl Tile (LVT) and, to be more specific, floating click-together LVT. I’m guessing your showroom is loaded with all sorts of brands, styles and designs from every company imaginable. Now, think back to a year ago; you had only the four main lines of LVT in your store. Each brand was marketed to different individuals with different needs. It was easier for you to sell because there were fewer options. You could make a decent margin on each job because there weren’t as many competitors in the market.
Fast forward one year. Now, you have over ten new displays and your margins are low. Why is that? If you take a look at your average selling prices, most of them are probably around the $3-4 per sqft. A year ago, they were probably closer to $5 or $6 sqft. Okay, so your prices are competitive, but what incentive do people have if they buy from you vs. your competitors?
How About This?
Instead of focusing on your competition’s price list, give your business a boost by offering products or services that are unique. Don’t undervalue and undercut your service, simply to have lower prices than your competitors. Give your customers a reason to buy from you. Offer them something of value, giving them a reason to invest more money to receive the extra incentive. Remember, selling higher quality products at higher prices means you need fewer customers.
For example, if your goal is to make $1 million this year, you’ll need to sell 20,000 pieces of LVT at $50, 2,000 pieces at $500, or 200 pieces at $5,000. For most of us, it’s much more manageable to focus on 200 customers than 20,000. See what I mean?
Higher quality products sold at higher prices are actually better for your customers because they last longer and – in the grand scheme of things – you will be making more money as a result.
Now, a lot of people think that selling high-priced products is more difficult than selling low-priced products. Not necessarily. They both take about the same amount of effort. However, many sales people make the mistake of trying to “1-step” the sales process. In other words, they simply send a customer to a rack to choose a color without any other direction. Only a small percentage of customers will buy a high-priced item that way. They like to be guided when making major purchases.
If you have determined that a high-end product would best suit your customer’s needs, start showing them the benefits of purchasing better flooring. Better quality flooring will be more durable and will increase the lifetime of both the product and your relationship with the customer.
And the moral of the story is…
Sell higher-quality products to gain happier customers and increase your bottom line.
“The higher the price you will have to pay, the more you will cherish it.”
– Lloyd C. Douglas