Lee talks about the advantages and disadvantages of being and telling people you are the cheapest in your market.
Good morning guys! I hope everybody’s doing great today. Checking out some washer and dryers we got over the weekend. I thought we might have had some decent ones, but I believe that one has got a little rust on it. It might still work, but it’s tough to sell it when it’s got rust all over the top for sure. Anyway, have a good day so far today. It’s been a fairly busy morning. I had several jobs interviews we just knocked out. Finally starting to get some good people applying. Get a lot of summer help. You got your college kids and all just getting out of college. Looking for summer work. That’s good anyway. You know, we’re going through our busy season, so that’s something we’ve got to have for sure.
What I will talk to everybody today about is those you out there trying to get a market share and get a business by claiming you’re the cheapest in your market. You’ve got to be careful doing that. There is a time when you’re first getting started that maybe that’s the way to go about it. If you are going to be the cheapest in your market, you need to have a good explanation as to why. Not simply because you just decide to accept less than a larger company. It just makes you appear a little less professional. People kind of wonder if your price is less, you are not as good of a service.
That’s something, if you’re going to be the cheapest, you need to have an explanation for it. What are acceptable explanations? One, is you’re just getting started. You just be honest to the people. You’re just getting started. You’ve done this type of work in the past for other people. You’ve done landscaping work. You’ve done labor work. You’ve been a mover. So, you can move stuff throughout homes and do a great job, but since you’re on the truck, you have less overhead than somebody that’s got a bunch of employees on their payroll. You answered all the phone calls from your cellphone. You don’t have an office where somebody is going to answer all the phones and that sort of. The owner being on the truck, what you got going on there is you’ve got a couple of good extra advantages because you can say the owner is on the truck. This is something that a lot of our partners with JRA.
This is an approach we do from time to time. We have several options when work with JRA with CAM customer acquisition management, or you buy a business package from us then what we do is we look at into your market. You can actually hire us for consulting too. $150 an hour consulting fee and we’ll actually look into your market and do like an analysis basically a market analysis. We’ll try and find you a competitive edge. It could be there’s a couple of different approaches you can take. It might not just be one approach. We say it might be a few different approaches, but one of the approaches we do is we tell people. Let’s say you’re on the truck and say nobody cares more about the quality of work that your company does. than the owner of the business. You’re able to charge less and do better work than your competitors because you own the business. You’re on the truck and you’re just getting started. So, that’s a good reason to be the cheapest in your market. Another good one would be is because you’re the largest in the market. You’re the largest in the market. You have a store. You have a dedicated store to actually sell the items you get. Tell people straight up. You sell the items you get. You recycle items you get because you’re making money on the back end. You can in turn charge less on the front end. That is another great reason. That’s also a reason that a lot of junk removal companies are not doing, including Junk Doctors.
I can tell you right now that that is something we are looking to go in the foreseeable future. We are already planning out sites for a minimum of 10,000. Anywhere from 10,000 to 30,000 square foot store. Kind of like a flea market type store. We’ll sell our stuff and we have some other stuff going on in that space too. You’re not going to fill up 10,000 square feet generally in any length of time from junk removal operations. You fill up several thousand square feet. This is not enough volume in junk removal due to really slam full of 10,000 square foot warehouse. We got another concept in between there. That will be something, once we prove it. It will be consulting people with as well.
There’s a reason large companies charge what they do. That’s what you need to charge to be profitable. Some of you have this fear, anxiety or somethings you feel bad about charging a lot of money for your services. What you got to remember is you deserve to be able to charge a fair price and make good money at your business. You are putting a lot of risks out there, to purchase equipment. You take loans out on stuff. You’re putting a lot of time and effort. You’re worried about meeting payroll. You know, there’s a lot of stress involved in running your business. You deserve to be able to make a profit. The only way you can make a profit is by charging enough for your services. 1-800-GOT-JUNK? is out there charging $550 in your market. That’s what they need to make money. Now, they’re paying about 15% back to the franchisor between royalties, call center fees and national advertising.
Right there, you have some discounts you can do. Don’t think you can discount your services 15% because you may not have a call center, but you’ve got the time to answer your phone or you’ve hired somebody to answer your phone or maybe you’re using the JRA call center. There is an expense with that stuff. 1-800-GOT-JUNK? that 15 percent is they do provide some service. A lot of it is just simply because the initial setup 1-800-GOT-JUNK? showed you how to get going. You’ve got the name recognition, but they do provide some services too. If they’re 15%, you might be able to be 5% or 10% less than 1-800-GOT-JUNK? on your prices. If you’re any more than that over any length of period of time, you better have a store. You better have some way that you’re catching that money by being smarter than 1-800-GOT-JUNK? on the back end. If you don’t, you’re shorting yourself and you’re not going to be able to have a long-term business that runs without you. Again, those of you that want to stay on the truck, you enjoy doing that. You want to be on the truck 10 to 15 years before your body wears out. I’m probably not the person for you. There’s plenty of other guys out on YouTube. There’s several others that are on the truck all the time and those are probably the ones for you to listen to. If you want to build a business that allows you to have freedom, allows you to go where you want to go, do what you want to do with who you want to do and when you want to do it, then I’m the guy for you.
I’m going to tell you the secrets to accomplish what I’ve accomplished. You’ll get a good taste of it off of YouTube if you really want to accelerate it. If you really want to have great success, you need to work with us. You need to hire us. You need to pay us a fee for our services because we’re going to be so committed to you. Making sure you’re successful. We’re going to give a lot of great information on YouTube, but those of you that come and work with us, you buy a business package from us. You buy consulting hours from us. You get websites. You have to do CAM and AdWords with us. The stuff that we’re talking about the needs to get done on YouTube. If you work with us, we’re going to accelerate that process. We’re going to make sure you’re successful.
I’m the guy and we’re the company for those of you that want something more than just simply being on the truck and having a job. You have to work hard. We’re going to show you a way to freedom and independence like you never imagined possible. Those of you that are looking at a junk removal as an investment. You found your freedom and independence. You’ve got a lot of extra money, and you’re looking to invest that money in something that’s in your own business. Maybe you’re in the corporate world. We are the guys for you, we’re going to get you out there. We’re going to allow you to keep most of your money where you don’t have to send it back to a franchisor. Have your own business locally owned where you can get more people.
We’re the guys for you, so give us a call at +1 919-466-9322. Know a couple of other reasons before we wrap this video up. Why being cheap isn’t the best long-term strategy? Cheap customers don’t normally repeat. They’re always looking for the cheapest price. So, as soon as you raise your prices a little or every single time they look to hire somebody to get a junk removal job done, there’s a good chance they’re going to get on Google. They’re going to get on Craigslist. Everybody hates Craigslist. They’re going to get on Craigslist and they’re going to call everybody up and they’re going to find the cheapest price. Can’t build a business of being the cheapest price, unless you have a competitive advantage which allows you to be the cheapest yet still have the same profit margins. Which allows you to get a lot more volume and allows you to get the customers that are looking for quality and they can see why you were able to be cheaper.
You offer the same quality, if not better. You probably will be re-using a lot more items if you’re selling them with a store. When you’re donating and recycling so they get this environmental act aspect of it. They can see why you can be the cheaper because you’re getting money on the back end. Always have a reason for that. If you want to get repeat customers, you have to offer value. Not simply cheapest price. The repeat customers that you’ll get from cheapest price are only lasts as long as your price stays low. As you soon as you try to raise the prices up, you’ll lose those customers normally, unless you have a good reason for why you were the cheapest
Customers, one of the main things you can offer, and I’ve said this a bunch. Same-day service, customers that just want it done. The stuffs here, they want it gone. Customers of the same-day service will pay whatever you want to charge for the most part, so that’s something to keep in mind. You much rather offer the quickest turnaround than the cheapest prices, unless you can do both with a good reason. Do not overcharge your customers and that’s something we have to make. We have a competition, we don’t do profit sharing with our guys. We have a monthly or weekly profit loss competition. So, each truck does a P and L each day. At the end of the week, whichever truck was the most profitable, gets a s$50 gift card. We’re about to make it $100 gift card. $50 Visa gift card. They can spend on anything they want, but we don’t count their income. They send in a job picture. We don’t count their income as if at the end of the job they over quoted the price. We erase that income. We don’t want any of our customers being overcharged. We don’t want them undercharged either. We would rather be high at the start, on the first estimate and bring it down. Should it not take up the entire truckload.
You got to make sure you do that or your guys. If you’re doing some sort of competition like that, your guys might overcharge your customers. You’ve got to make sure the customers are not getting overcharged. The fact of the matter is, the problem with being the cheapest and having really small margins is you can’t advertise. You can’t get your word out there. You can’t sell. You can’t afford to pay a salesperson commission or you can’t afford to hire somebody else to take care of your task while you go out and sell. You can’t afford to advertise. You can’t afford AdWords, AdWords management, CAM and SEO. You cannot afford that stuff unless you get your prices high enough where it should to be.
Being cheapest, it could be a decent strategy to get you going and get you out there. You better have a good reason as to why you are the cheapest if you want to keep going long-term. You’ve got to build value in terms of having a clean trucks, professional people, and great personality people. People that come on and they got good personality. Same-day service you know that quick turnaround. That’s the kind of stuff you got to do to really build a business. You need to have the margins where you can send thank you cards. Have time to send thank you cards, magnets, postcards, reminder emails and an email campaign. You need to stay top of mind with your customers and that requires money. So, you need to have the margins to be able to invest in your business and your customers. If you offer the best service and if you’re a great service provider, yet you don’t have your prices high enough that you could let people know about them. You’re holding back. You’re holding information back from your potential customers because you’re the cheapest. Charge what you need to charge to make good money. Don’t jeopardize your future and your family’s future because you feel sorry for somebody. You want to charge them a bit less. 90% of our customers, if not more, are ecstatic about what we charge. We’re expensive. We’re not the most expensive in the market, we’re about 2nd or 3rd. We’re behind 1-800-GOT-JUNK? Probably behind College Hunks Hauling Junks but we’re more expensive than Junk King and stand-up guys Junkluggers and a few of those in the market.
We’re the busiest ones in the entire market. 1-800-GOT-JUNK? the top two most expensive in the market are one and two. The rest of the guys going for the cheap game. they’re beneath us. They’re well beneath us. We’ve got just in our Raleigh location. System-wide, we’ve got 10 trucks now, but just in Raleigh we have 6 trucks. 1-800-GOT-JUNK? has even 5 or 6. Junk King has one. Junkluggers has one. Stand-up guys have either one or two, so they’re the cheapest. They’re playing the cheap game. We’re able to go out and get more vehicles. Expand our operation, reach more people. Do more good for our community because we charge enough where we can actually advertise and let people know about us. That’s what you need to get to. If you get to, then get to that. You’re going to ride that wave all the way to the top. We want to be with you. We’re going to make that wave. We’re going to make it come even faster. We’ll make it be even taller if you work with us. Watch this videos the you’re going to be able to catch the wave, but if you work with JRA you’re going to catch a tsunami. Ride it all the way to the promised land. So, give us a call +1 919-466-9322. I enjoy helping everybody out. Everybody has a wonderful day. We have a Junk Removal Made Simple episode getting recorded later today. We’ve got some great big news coming up. Big news, it’s going to benefit everybody here on YouTube.
There’s going to be massive amounts of content. The likes that no junk removal business or service-based business has ever put out. It’s going to be starting to hit YouTube, Facebook, Instagram, Snapchat, Pinterest, Twitter and all the different social media. As well as a crazy number of videos. We’re going to have massive amounts of content and information that’s going to be hitting all the social media stuff soon. Nobody’s ever done anything close. Give us just about a month or so. We are just going to start it happening. We’ll explain more details when we can. Again, +1 919-466-9322. Lee Godbold here with Junk Removal Authority. Decided to bring this video to you. We’ll talk to you soon.