Do You Charge Too Much? (for Locksmiths) 2022

Have you ever been told that you charge too much? Well, I think we all have. I want to open up the conversation and talk about it with Chris and the Lockfather.

PJ: It's a reality of life, that we're all going to get phone calls of people wanting us to lower prices, someone else will do it cheaper, someone will, there's someone that and so I want to kind of just talking about both of you have established locksmithing businesses. And if someone is new, starting, may be struggling in their area, it can get very defeating to get those phone calls, say you're charging too much, they'll find someone down the road that will do it less, and it's a bummer. And it's stressful. And so I want to hear both of your strategies on when you get phone calls like that, how do you handle it? Do you explain a little bit? Do you match pricing? What does all that look like? So, Chris, I'm guessing you've gotten phone calls -

CHRIS' STRATEGIES

Chris: It's almost routine. That seems to be a very normal thing in this business, I'm sure for many other companies, too, but people want to save money. That's the bottom line. Suppose you look at a business model, where I have, where I'm a lone wolf. In that case, it's just being old silver out there compared to your father, who has multiple employees, multiple properties; his overhead is much different than my overhead. For those reasons, we have other pricing models where we're located, the services we offer, everything involved, and yet, people will call, and they will say I want it done for this much, or I have something new cheaper and it's frustrating.

PJ: Yeah. And when that happens, how are you talking about it? Like someone's like, you know, you quote, let's say, $100 for rekey, and someone's like, oh, I just called Joe down the street, and he's $80.

Chris: Good question. So if you went to just an example, he went to a five-star restaurant that valet they checked your coat, everything smelled great, and the state came at the end of the dinner, and the bill was for $12, you probably think they cut a lot of corners. So there's a reason why the cost is lower and usually has to do with quality, their effectiveness, the messaging, and the brand they have. If you're an established locksmith in a city and have people who use you regularly, you shouldn't be stressing over the people they want and done cheaper because those are the people you want in your repertoire, people. So you have to sometimes explain to them like I'm sorry, I can't help you, or you can even give them alternatively. You can be flexible, and your dad and I were talking about that where hey, I need a lockout done, I need a lock changed and if it's something that I can't get to you, and they don't like the price and say, well give me an alternative, I can come out tomorrow, I come out later in the day, I will be willing to reduce my price. Still, it's on my principles, my basis.

PJ: Yeah.

Chris: So you can be flexible, you can be rigid, you can affirm to another person that might help them out, but that's just part of doing business. It just always is-

PJ: It is

Pete: Absolutely

LOCKFATHER'S STRATEGIES

PJ: So dad, when your company gets a call, and for rekey, let's say, hypothetical numbers here, and you call them $100. And they're like, Oh, I just got off the phone with so and so, and they're $80. How are you handling that situation?

Pete: Well, it depends how rough the customer is.

PJ: Okay.

Pete: I said, Well, we got brick and mortar. If there's an issue, you can come to us and save money. As I said, you can always bring it in, but we have fixed costs, and they go well. That's ridiculous. It only took you 20 minutes. Well, when you work at your job, I say, and you get $40 an hour, well, that's just for you. I have to pay for these trucks, and repairs and gas and insurance so we're able to come to you, and there's a cost to it. So, they want to negotiate that, and I said there is no negotiate things, especially at night. The guys are on their time. They're taken away from their family to earn more money.

PJ: Yeah.

Pete: And a lockout is very expensive at night. And why would they want to do it any less if they're only making five bucks more than they made during the day?

PJ: Oh, it doesn't incentivize them.

Pete: Right? And they said, why do we want to do it? And I realized this last year, that we really had to step that up. And we still get minimum of 20 a weekend, but I go really; people are going to pay it? Because again, I always say, people only have so much money. It won't break a window, and so if you break the window, then it's going to cost you that much more - a lot more to fix it.

Chris: It's always free, breaking the windows free. It's the cost associated with afterward.

PJ: Yeah, good point. So what I'm hearing at both of you in a little bit different ways is, when a customer starts to talk like that, you're kind of telling them your value added services, like, this is who I am, this is why we do what we do, and if you want the service that we provide, this is the cost. At the same time, you want to be reasonable and flexible based on -

Chris: - if you can, and as your dad said, it depends on their demeanor, they call, and they're rigid with what they have to tell if it's, Hey, I'm a student, or hey, you know, I can work with that. I know their approach makes a big difference.

PJ: Yup.

Pete: Yeah, absolutely.

WHEN IT'S YOUR BUSINESS VS. WHEN YOU ARE THE CUSTOMER

PJ: Yeah, I think those are great points. I have one other question for you. To have a little fun, we can talk about it a little bit. It's one thing when we're talking about our businesses and the pricing that we offer, but it's the other thing when we're on the other side, and we're the consumer, right? Maybe it's calling out the plumber or this or that, and all of a sudden, and you think the bill will be $80 and that you get quoted $100 or the $200.

Pete: Or $400 like you

PJ: Or the $400. Yes, like me, and yeah, I said I had my water heater go down. And you know, my family doesn't prefer to take cold showers.

Chris: Most don't.

PJ: And so I found someone to come out right away, and they're quoting me between $7500-$10,000 for a new water heater, and I'm like-

Chris: Is this like for a facility, or is this house?

PJ: For my house. And I'm like, Oh, my gosh. I was sitting there in Costco when I got the phone call, and I was like, Oh, my goodness, that is a lot of money. I'm sorry. I will have to call, so I called the plumber who did this building. And he -

Chris: Less?

PJ: Yeah, without discounts, it was $3300. 

Chris: Sounds about right.

PJ: Right, but it's one of those things that's exciting and fun to talk about. Like, it's one thing when it's your business and your charges. It's another thing when you're on the other side, and so do you ever find yourself questioning? Now, if they would have quoted me this company if they would have mentioned me like $3800, or even probably four grand, In a blink, then I just had it done like, I'm okay. It's been eight years since I've had a water heater-

Chris: The problem they solve is worth that cost to you. It transcends the cost of it because then you have that problem. The issue is gone. We see it on the locksmith side. Fix stuff. We open, you know.

PJ: Yeah. And it was one of those, and they kept calling me back and, you know, it was like, You guys like, we're literally like, trying to take advantage of me.

Chris: When someone wrote a check, their mouth couldn't cash in.

PJ: Yeah.

Pete: Right. Because, for instance, I got a quote to get a gas line put into the shop at my house, and I still had to dig the hole, it was like 125 feet, and they wanted $5,000 to run the pipe, get it to the heater and hook it up. They go, really, and I thought maybe it'd be 1000 bucks.

Chris: That's about a pipe from where it comes into, and it was already dug, so they said they trench it and run it up to the shop. Peter said -

PJ: Lay it in that hole.

Pete: That's it. Which he knows-

Chris: -I'm taking my own business.

Pete: Well, that's what we say. Everybody should be in your business.

Chris: Yeah.

Pete: And I go $5,000, and I go, how do you figure that? And when we do commercial stuff, we're $100 an hour, and you guys are working. It's only going to take three hours, so I understand the materials. I don't mind anybody making money, but I'm not going to be taking advantage of, so I told my buddy, he goes, you can buy that pipe down at the big box. And I go well, and I don't particularly appreciate supporting big boxes. I want to help the little guy. And by the time I ran the wire, and the little yellow wire for saying it's gas so I can find it. And I installed it all - vents everything. It cost me $1,100 because I still have to dig the hole that wasn't included anyway.

Chris: How much is your time worth too.

Pete: Right. But I'm the type of guy; I enjoy doing all that stuff. I said to PJ, fix it yourself. I'd rather pay somebody.

Chris: Don't you fix it yourself?

Pete: He told me after that. The wiring he calls me. But it, you know, sometimes it is just too much because as I say, in every video, you only have so much money you have to spend on something like that. I mean, I have a wood fireplace in there. I had it in there for 15 years, but it's still too cold during winter.

Chris: You seen my shop, I have that little wood stove back right there, and it does a modest job of keeping it warm, but to me, the time to run natural gas down there and heat it, it's just not worth it.

PJ: Right.

Pete: Well, what I'd like to do is stay in the shop, do woodwork and all my saws, I touch them. And it's ice cold. You can't feel them.

Chris: Well, I had a replay siding on my house, and I got two bids. And the first one came in. And this is just normal siding, like a concrete board or something modern. Get those old 1950s cedar shingles off. And it was somewhere around 26 grand, and I'm doing the math and counting the square footage on like, that's like $18,000 profit, and I started thinking I can do this myself. So this spring will be trying to redo all the siding on my house, so wish me luck. Because same as your dad, it's like I can do it by myself. I don't; everyone only has so much money, and if that's not in my budget to spend that much, I can get to new vans on the road for that much, not new -

PJ: Absolutely, and that's the reason I wanted to bring this other side up a little bit, right? Because a lot of times, it's accessible to kind of talk about why we charge what we charge, but we're also all consumers as well.

Chris: Cost and value are two very different things.

PJ: Yes, they are. And it's just also to recognize in ourselves, our tendencies about that, and there are going to be times where we could quote, for some rekey and the guy who said, you know what, I'm just going to do it myself, right? Because his cost value is different, it's a hard reality for us to all live with. But that's just how the world works. And I think that when we take that approach to it even understand more of our thoughts and how we handle things, it's a lot easier on the other side when we're talking to someone about our pricing to speak to them kindly. Professionally that can get our point across.

Chris: Right. I've had people who've turned down my pricing for whatever reason, the time window didn't work for them, but they still use me because of the way I treat them on the phone or I say, Hey, I've read for people, your dad and say, Hey, I'm booked up for tomorrow. Still, you have a safe, call over or country lock, make sure your Tanner out there, he is a great guy or, Pete out there, they're great guys, and they've called me back and said hey, I got a car key. I'm in Spokane, I need. I got a house and rekeyed over in Post Falls wherever. Yeah, so those little things make a difference.

PJ: Absolutely. Yeah, that's what I think that's, you know, of course, this is a heated topic. Right. And this one, you know -

Chris: Lots of pricing is a whole debate. It will probably go on after my career's over to it just

PJ: Yeah, I think it's universal in business. Really. It's universal.

Pete: I don't care if they have a tiny little house or a mansion. I'm giving them the same price.

Chris: Yeah, exactly.

Pete: The only time I give my services away if it's what is it called? You know, they lost everything.

PJ: Yeah. Just like a more desperate type of situation.

Chris: I think most of us have done that; we have a heart. We'll go out there, and hey, the house is burned down, and I've had that situation. They needed the car keys right there. Right. Why not?

Pete: Because you know, it's not worth it.

Chris: Yeah. Karma, you know, it's the thing.

PJ: Right? Absolutely. Well, man, I tell you what, I think this was a great conversation. I think it was productive, and I think it's great. And I thank both of you for being open enough and willing to talk about this in a way that everyone watching can hear.

Chris: There's always a lot of discussion about tools, techniques, and processes, but there's not as much on the business side of things. That's a great conversation always have.

We would all love to know your thoughts in the comments of our YouTube video. We will be reading them and include the #LockBoss to automatically get entered in to win one of five free prizes we give away each week on YouTube. Thank you, and we'll see you next time.