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The $10,000 Promise & Pricing
Estimate Worksheet
Nine times out of ten when I
go into a small business to consult I find pricing
issues. Many companies don't know what
they should be charging. They don't know if they
should raise or lower prices. They don't know how
much profit they have built into the sale of their
product or how much profit they have built into an
estimate or a bid for a job they propose to perform.
For a business, not knowing this is unacceptable.
Let me
state the obvious: If you're not turning a decent profit
now, then you're not pricing properly... or... your costs
(labor, material and/or overhead) are too high; one or
the other.
And I always hear the
same thing initially from my clients: "I know my
costs are in line and I just can't charge any more."
Sorry, I don't buy it. There are too many companies
making money. How do they do it?
I inevitably go through a process of getting
business owners to understand pricing concepts and the
ingredients for proper pricing; things such as true
costs of labor and material, overhead load and optimum
profit level by job or product. There is a concept
called margin mix. All owners
should grasp it.
Many of you may know
these concepts or are close to knowing them. But even if
you don't know exactly, you can still use a simple Excel
program for your pricing that you could enter
numbers into and probably give you a better number than
what you are charging for your product or service now.
Here's the promise:
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If
you have proper financials and generally know true
costs (labor burden, etc),
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know your proper overhead load (e-mail me if
you don't, I'll help you calculate), |
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provide a quality product or service,
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your business does at least $300,000 a year in
sales, |
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and you use the downloaded bidding tool to raise or lower your prices
accordingly... |
You will make at least
an additional $10,000 profit in the next 6 months. And probably a lot
more. It works every time!
Just click on the
download form below. It's a simple Excel
spreadsheet. Get familiar with it. Use your own
bidding system; then use this one to compare. It
will tell you what you should be charging to make your
desired profit level. Over time, start using this one
all the time.
If the prices
estimated are too high in your mind, then you must take
a hard look at your costs. It's pretty basic.
Remember:
No profit or low profit equals
either prices too low or
costs too high.
If you need help with this
tool, in reducing your costs, if pricing looks skewed, or if you have any
questions,
contact me,
(e-mail:
randy@rmoonconsulting.com,
ph. 1-800-571-7047) and I will get back to you within
a day.
(Depending on your industry,
you may need another type of pricing tool. Contact me.)
...And you need
to be job costing also. This spreadsheet has a job
cost tool also.
To go to
Download Page, please fill out this form.
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Worth based.
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