Know-How Exchange : Strategy

1. Sell the benefit. Make sure the prospect understands what makes you different and better than your competitors.

2. Bid an amount you'd be willing to take to do the job, not a penny less. The last thing you need is a big commercial job that loses money every week/month.

When I'm in a competitive bidding situation, I try NOT to be the low bidder, and I force myself to justify why the client will be better off paying me more than the low bidder.

If bids are normally based on sq ft then you might have to submit it that way....but only at the very end.

Clearly there is a reason they are out for bid. There was something they didn't like about the current provider. If it's just price I'd encourage you to proceed cautiously. What are your hard costs and how much margin do you want? Don't trade dollars. They aren't.

Give them options based on the length of the agreement. If they'll commit for 2 years, give them a better price. If you're a "minority" don't push it, but mention it. If you subcontract, make sure you talk about that..if that is a key for them.

Do a ton of homework on the company. Don't do this blind. Use their language in the proposal.

If they won't commit to a set time, give them a price and then something off on the next job.

Give them ways to reduce their costs. We're coming up to rainy season. Provide them with umbrella wraps. They're cheap and will save you on the amount of chemicals you use.

Michael

Are you a general cleaner or specific to one area, as a carpet cleaner?

Do you have insurance-- in commercial projects that will be required. You may need to be bonded. If you are a carpet cleaner, are you IICRC certified? Your competitors will use those things as selling points.

Is the building a LEED building, and is there is a requirement for low voc or other "green" cleaning products to be used.

Three orgs/ezines you need to subscribe to, SCRT, Cleanfax and Clean & maintanence Management. The discussion of "what and how to charge" is brought up regularly. And you can post there or read the message boards. It's always a popular topic. You will also learn the add on services that will increase your sale.

You will find guidelines, but it's really, what the market will bear. Pricing a proposal is something you learn over time. You will know your competitors, and learn how they price a job.

Lastly, remember that just because it's a bid doesn't mean the client will go with the lowest price. Don't just sell on price.

Sell Well and Prosper tm

Talk to people in your area who recently put out cleaning for bid (and chose one of your competitors). See if you can't review their bids to better understand the format, promises, and strategy of their bids. That'll give you some insight about how your competition bids.

Then, in future bids, try to cover the same issues but also give professional explanations for you bidding price. Perhaps you offer a guarantee (time to clean, starting time, etc.) that no one else does. Perhaps you specialize in using totally organic products. But identify something that'll put you ahead of everyone else. And bid responsibly - to yourself and to your prospective clients.

Having helped a family launch into your business, here is how we configured the bid.. It depends a bit on the facility. Most of the time we were talking about offices and retail space.

First we defined everything that would be done on a daily or weekly basis:
Vacumming, mop work, trash pick-up, dusting, restrooms, etc

For offices this was done on a per cubical/desk and bathroom stall basis. We found that square footage means less than number of personal spaces.

For retail space it was done on square footage - with multipication factors for extra difficulty (shelving units to move etc)

We also specified what we recommended be done on a monthly, quarterly and annual basis. This was an extra charge. Things like cleaning lighting fixtures, shampooing carpet, waxing bathroom floors, etc.
These were priced completely seperately.

We found that keeping the weekly/montly fee down was critical to landing work... and once in place, we could make extra money by driving the 'recommended' work.

hope this helps... good luck

On setting price, I talk about this a bit on a blog post froma while back:
https://expandabroad.blogspot.com/2005/08/how-to-price-new-product.html

I would make sure you know how your competitors bid, and what sort of rates they ask for. This what customers will expect.

You can vary from this, if you have a good reason. For example, if standards bids are complex and you can provide a way that makes it much easier, then do this, as it could be a competitive advantage.

Wow, Carol, what fortuitous timing, that CleanBid program looks amazing!

Jak, the best advice I can offer is to visit with the prospect - on the basis you need to look through the premises - and find out all their 'pain points', the areas of their dissatisfaction with the incumbent cleaners, assuming this is not a completely brand-new building.

Then write your sales letter and bid document around your standard service but with extra attention to all their pain points.

When you deliver the bid, try to do so face to face so you can sit with the prospect and walk them through all the extra stuff you'll do to fix the things they are having trouble with right now. And ask them at the end if your bid has successfully addressed all their concerns - if not, find out what else and re-bid.

Maybe offer to strip all floors and re-finish, and dry-clean all carpets, once off, at the start, to get the premises to a really clean condition upfront.

Finally, any certifications or other "risk reduction" things you can offer may help, e.g.:

* Fully insured against liability claims
* ISO 9000 compliant
* All staff police-checked or if that's not something you can readily do, then:
* All staff reference checked
*Cleaning team manager and help desk to report any concerns
*References from other customers

If/when you win a bid, call the client after the first clean to check they are happy and subsequently once a week. Also, randomly call in to conduct a personal inspection so you can be satisfied your people are doing the job the way you promised they would.

Good luck

ChrisB