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Residential FlooringColumnsBusiness Insights

The Trusted Sales Advisor

Full Pricing Full Disclosure

By Kelly Kramer
Slideshow Image

A full disclosure price tag, right, such as the one Kelly Kramer uses in his store, gives consumers all the information they need to know in understanding the final purchase price, while the other tag illustrates just a simple price with no acknowledgement for the cost of everything else required in the purchase.

April 1, 2014

Throughout my career in retail flooring sales I’ve worked for several companies and each had its own way of presenting product and installation pricing.

I’ve worked systems that do a bait-and-switch method, which is where they advertise the lowest prices “Guaranteed,” then triple the prices on the pad, labor, furniture moving, and even charge huge prices per lineal foot of tack strip. The trick is to hope buyers are ignorant of what all gets priced for a professional job.

Then there is the most common system of being up front and honestly showing a fair price separately. Then explaining—also up front—the real cost of the pad, labor, specialty labors, furniture moving, and haul off. One reason some stay away from this method is it seems like the add-ons never end.

I used to present this method at a few stores and, while I felt good about the honesty part, I could see the look on my buyer’s face go sour when the list of costs seemingly went on and on. Then, of course, you get the ignorant buyer who says, “How come you charge for pad and labor and at the other company it’s free?” It is hard to be the honest company when people can be fooled so easily.

Then there is the system I’ve never worked that I consider the biggest black eye on the ethics of our entire retail industry. You know, the shop-at-home that advertises non-stop on TV. It shows happy homeowners saying, “I got this much carpet but only paid for this much.” The buy one get three free guys.

Just in case you have not figured out how they do it, here’s my understanding of the system. A call center sets up an in-home appointment for their local high-pressure sales “vulture.” That hard hitter takes a vehicle filled with mostly low-end and some high-end stock items to the house. It’s stocked so the low-end goods can be advertised as next day installation.

Then the estimator/sales clerk does a very quick and very high footage measure. This way he is never short. Plus, why waste time on exact measuring when measuring too high pays better?

Next, the few high-end items that are stocked are shown—because you might as well take a shot at the big bucks. During this time complete prices are given. If the consumer asks for the categorical breakdown, the high-pressure closer refuses because, “It’s a package deal.” If the buyer insists, the sales estimator can’t show where the buy one get three free part is, so he politely says, “I’m sorry I’ve wasted your time” and leaves.

This is because if the truth gets out it could collapse the company’s reputation and its “empire”—especially in these days of social media.

But, if the buyer does not object to the method of getting to a final cost, she is given the “do I look stupid total price”—the one for which the salesperson gets paid the highest commission.

If the buyer does not bite, the salesperson says, “Let me call my boss to see if we can get a better deal.” He goes outside, makes a fake call and comes back with the next level of “do I look stupid pricing.”

If that price is not bought then the closing is done—for now. Then, after three days an even more skilled closer calls the customer with an even more tempting offer. If that offer is taken I’m told the original in-home salesperson gets little to no commission.

Now you can see why that measure and total price are done so fast. The sales rep hits hard and fast and moves on. It’s selling dirty and the main reason I titled my first training manual, “Selling Clean In Retail Flooring.” (Full disclosure, that was a plug for my training manuals.)

For the last 15 years I’ve presented my customers with full pricing on the sample’s sales tag. This way I can explain, “These prices are complete with the carpet, 8 pound pad, standard labor and haul off of the old carpet.”

Then, in the name of full disclosure I say, “What the price does not include is specialty labor such as steps or wall upholstery or moving furniture.” Then it’s easy to give them a realistic ballpark guestimate in the store.

As an example of that conversation: “If we take your footage guestimate at 1,000 square feet times, for example, $4 a square foot with everything, including the best pad, specialty labor, 13 steps, moving furniture and even tax, you should come out to about $4,400. That’s a real number, not the bait-and-switch number.”

Then simply watch the signs on their face. You’ll know if they are comfortable with that price. If they are not show them lower priced goods, or give reasons why they might need to spend that much to achieve the proper purchase for their given situation.

If they are comfortable with the price, set up an in-home estimate. In nine out of 10 cases I try to give them an in-store guestimate that is high. Then when the final price is lower, what’s not to close? If they let me come to their home to measure thinking $4,400 is fine, then $4,200 is even better. I’d much rather my final total be lower than higher. And, because the buyer always expects it to be higher it’s like a breath of fresh air.

Put simply, full pricing on any product is full disclosure and it makes you a Trusted Sales Advisor not a deceptive hard closer. Thanks for reading.

KEYWORDS: market trends sales tips

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Kelly kramer 200px
Based in Loveland, Colo., Kelly Kramer is an author, inventor and owner of Kelly’s Carpet Wagon. He is a 27-year veteran of the flooring industry, with 25 of those years as a retail sales advisor. To contact him with questions or to book him for public speaking engagements, call or email: (970) 622-0077; retaileducation@netzero.net

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