It’s Time to Raise Your Junk Removal Prices
Tip of the Week with Lee Godbold
The current business climate is unstable and unpredictable to say the least. It seems every day there is a new shortage or price increase that pops up. In order to make sure your junk removal company continues to grow and be profitable, we must react as quickly as the market with pricing changes. That’s why the time to raise your junk removal prices is now.
Here are the facts. Over the next 12 months, you are going to have to:
- Spend more on labor to keep great people.
- Spend much more on trucks to increase your fleet size.
- Keep up with rising commercial insurance rates.
- Pay 33% more for fuel than you paid last year.
- Pay more for truck parts that are in limited supply.
- Keep up with rising landfill costs, and more!
Sulking, complaining, or wallowing in self-pity is useless. It does absolutely no good.
Here’s the good news. Everyone. Every single one of your competitors is playing under the same set of circumstances. You have to pass these costs on to your consumer in order to stay in business and stay profitable enough to keep growing. That means the time to raise prices is now!
I am recommending a 5% price increase for every single JRA customer over what you were charging in September. Leave your minimum price point alone but raise up every other price point.
Now, watch two things moving forward. One, if you are not on the job yourself, check your end-of-job pictures to verify quote accuracy. Second, keep an eye on your on-site cancelations. If you are completing about 90-93% of the jobs you show up for, then your pricing isn’t too high. But, if that number drops below that range then investigate further. If after 90 days or so you haven’t seen a consistent drop in on-site completion percentage, you might need to consider another price increase.
Let’s finish 2021 strong!