Foxy Home Staging Shares the Secret of Revolutionary Quoting Tool
When it comes to putting a price tag on home staging services, it’s not uncommon for business owners to miss the importance of spending time to figure out the right pricing model. But just as important is the need for businesses to implement and use tools that allow for both speed and consistency in their pricing.
There are two key reasons that the decision around pricing is important for your business:
1. The price you charge tells the market something about your services. It portrays information to your clients. Like it or not, it forms part of your brand and reputation.
2. It has a direct impact on the profitability of your business. And if you’re not profitable, it won’t be long until you’re out of business.
Having had many conversations with home staging business owners on this topic, it’s evident that many haven’t put much thought into how they price themselves, and worse, often don’t know which jobs they are making money on.
So let’s start by looking at the common methods home stagers can use to determine their price:
- Costs plus a Margin – A calculation of direct costs (furniture hire, contractor wages,
logistics), and adding a margin (e.g. 20%). This ensures you are profitable each job, but is often time-consuming and doesn’t always consider your branding.
- Return on Investment – Calculating a required return on capital investment in furniture. Or put another way, how quickly should any purchased item pay itself back?
- Percentage of listing/selling price – E.g. 1.5% of the listing price. This is a very fast way to quote, but the downside is it doesn’t account for differences in property sizes or furniture requirements.
- Hourly rate – Pricing based on an estimated number of hours required.
- Rate based on size – Pricing based on the size of the property.
- Fixed fee – Either fully fixed or a fixed price per room.
All of these methods have their pros and cons, and each business should determine what combination of methods best suits their needs from a profitability and branding standpoint.
Some pricing methods are faster than others. For example, quoting based on an hourly rate, percentage of the listing price, a rate based on size, or a fixed fee, can all be quite fast. On the other hand, quoting based on the ‘Costs plus a Margin’ method, or ‘Return on Investment’, can be very time-consuming. They are also the most intricate, leaving more room for inconsistencies to creep in between quotes.
Photo: Foxy Home Staging
Once the decision on pricing methodology has been made, the next step is to ensure that your quoting process is both fast and efficient and that your pricing is being applied consistently. Speed is important because it’s time that could be spent in other parts of your business. Many business owners do the quoting themselves, but as your business grows it’s easy to find yourself bogged down in the admin (e.g. quoting) and an inefficient process is a time waste.
Consistency is just as important because pricing is part of your brand and what the market will know you for. You want your real estate agents to know what to expect when they refer you work. You want potential clients to have a realistic expectation of price beforehand. And more importantly, as the business owner, you need to be able to communicate your price and value to the client, and that comes with consistency.
Photo: Foxy Home Staging
To assist with both the speed and consistency of the quoting process, the best solution is a quoting tool that lets you automate as much as possible. That doesn’t mean removing human decision making, but it means streamlining the calculations that are often the same each time.
There is a whole range of options available, from online software to simple spreadsheets, and everything in between. My recommendation is to ask for recommendations from your industry peers, and then do your own research.
Still, no idea where to start? I’m making the Foxy Quoting Tool available to anyone who would like some guidance. It’s a detailed Excel spreadsheet that we’ve developed and used internally in our business, and I want to share it with other home staging business owners.
I’ll go into more detail for those who want the spreadsheet. But put simply, it automates as much as possible about the quoting process. For example, with one click of a button, I can add a Master Bedroom and everything that goes with it (bed, bedside tables, lamps, linen, bedding, artwork, etc.), instead of adding each item individually.
The Foxy Quoting Tool won’t be right for everyone and that’s perfectly fine. For others, it may just be a useful tool to help guide your thoughts and get clear on your own pricing methodology.
The important part is for any business owners who haven’t already, to stop guessing, and start being deliberate about your pricing.
Download the Quoting Tool for FREE right here.
Join us this 10th June at Pricing Your Services with the Revolutionary Quoting Tool Webinar with Jake Shorter of Foxy Home Staging. Get your ticket here.
Foxy Home Staging is an Australian Staging Company. Learn more about Jake and Foxy Home Staging by visiting their website.