Let me first say I have been in business for 22 years, during this time I have seen and been through alot. Over the first 20 years two things were consistent work and my ability to increase my prices. Over the past two years work has been very inconsistent and prices have plummeted. Of course we have a bad economy to blame, but what is disturbing is this free fall that has occurred even as inflation rears its ugly head. My business is surviving these times thanks to a loyal group of clients whom I have built a professional relationship. These men and women have come to trust and depend on me and the cost of a job never comes up, they simply call on me to do the work knowing I will be fair. The new customers and work I am receiving is coming from word of mouth recommendation. I have bid jobs over the past two years, and even though I trim the price as much as possible I will not get the job. What is disturbing is many of these contracts are being awarded at 1990 level prices. I had an old client and friend tell me when I first went into business, "you know you can be busy as the dickens and still go broke". He told me this when I gave him a quote on the first job I did for him, He looked at my quote and those were the first words out of his mouth. Then he told me, " go back and redo this and make yourself some money, I am not looking for the cheapest surveyor I am looking for one I can trust and trust the work he does". I changed my quote did the job and work for this gentleman until he died in 2007.
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Thoughts
Deward,
No I have seen a slow drop in activity since 2006, however things dropped off a cliff the past two years. I agree the government inflation numbers have improved, but this does not include food and fuel. Factor these items in and I don't think the numbers are so rosey. I am in survival mode as with many others and am very thankful that I was somewhat prepared for this. So I think I will make it with I will come out on the other side with my business and more importantly my professional integrity intact. Thanks for your comments and encouragement I have always tried to do things the right way even if it cost me financially this has kept a deep pool of loyal clients to rely on.
Well, Dean I have to say, if you have only had trouble the last 2 years then consider yourself very lucky. I am uncertain what you mean by inflation being a recent problem. According to the numbers inflation averages have been lower over the last 2 years than the previous 8 years before that. If you are facing downward pressure on the pricing of your service and product this is a sign of deflation.
Loyal clients and the ability to get business by word of mouth in this business environment show that you are providing a superior product and service. This is something to be proud of. It is sad that some of your competitors have dropped their prices so much that it makes it hard to compete, make any money or survive. Your friend had good advice when he said "you can be busy but go broke."
I know how tough it is to hang on under these type of business conditions. If your competitors keep lowering their prices they will go out of business eventually. You just have to hang on until they do. Price never defines a professional product and service, what defines it is quality. If you continue to turn out a professional quality service and product you have nothing the worry about. Wishing you success.