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Ask the Marketer: Dealing with Bottom Feeders

by Mike Crow, Mastermind Inspector Community

One of most frequent questions I get is how to deal with low-priced inspectors- in fact, I get this question so often I want to answer it sooner rather than later!  Do you know the answer?  Even if you think you do, this story will help keep you from having to compete on price and losing business to those who do.

The marketplace always seems to have new inspectors, or worse, desperate inspectors who at some point decide the only way to compete is on price. Let’s see if we can show you a better way because there is one. 

I remember sitting in a meeting with a group of inspectors when all were asked to name a company that they thought would be a good model to follow.  I was shocked when I heard companies like Southwest and Wal-Mart. Don’t get me wrong, these are great companies and I use both of them from time to time.  I simply don’t want to build my business on the same model they built theirs on.  Why? Because both are what you would call low-price leaders.  Now this can be an effective strategy if you want to use it – but be careful because there is always someone who thinks they can do it cheaper. If you stop and think about it, both Southwest and Wal-Mart replaced a competitor that thought they could compete on price. I suspect at some point if they don’t adjust they will likely be replaced as well.  Amazon is taking a shot at Wal-Mart even as you read this.

One of the many companies that I model my business after is Disney. If you know me, this probably doesn’t surprise you.  Companies like Disney continue to bring new ideas to the market and price is rarely the focus. In fact, most of the time when you hear an advertisement for Walt Disney World they are talking about the attractions, the dreams, the celebrations, and the memories.  You need to do the same thing with your business and you need to make sure the marketplace knows about it.

The main way to do this is to make sure that you and the bottom feeders don’t look the same, or worse, that they look better than you.  How do you do this?  You pay attention to what I call USPs (Unique Selling Positions). The problem with inspectors, if they advertise at all, advertise that they offer a good quality inspection, they really care, offer a thorough inspection, take really good care of the buyer, work for the buyer and not the seller and so on and so forth.

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Here is the test.  Line 100 inspectors up and play “Who Gets the Business.” If you ask every inspector who delivers a good inspection to step forward then, unless you have a poor inadequate soul, they are all going to step forward. The same happens when you ask if you have the buyer’s interest at heart, please step forward.  You see, without realizing it, every one of these inspectors has positioned them self as a commodity.

Commodities Are Sold on Price: Don’t be a Commodity
When a buyer can’t see any difference between you and your competitors they start asking the price question, and of course, someone who is willing to lowball is more than happy to fill that position. Why? It is either because they don’t know any better, or they are desperate, or like some of my friends at the meeting, they are modeling their business after Wal-Mart because they believe this is the best way to run a business. They are hoping that when 100 inspectors are competing, the buyer will ask that the cheapest one please step forward and it will be them. This hurts me to even believe that someone thinks this way.

Because buyers don’t know any different, it is up to us to help them see the difference. We need to show them that there is a difference.  So, let’s play the “Who Gets the Business” game with a new set of questions.

• Do you deliver the report at the time of the inspection? Now only 75 out of the 100 steps forward.
• Do you do a computerized report, with a summary page?  Now we are down to 50.
• Do you offer color digital photos with your report? Now we are down to 45 – maybe no difference because today everyone offers photos.
• Do you offer a guarantee on your findings? Now we are down to 20 inspection companies.
• What question or series of questions would you have them ask from here that leads them to just you? I can help you with that…

I think you get the idea.  You need to direct the buyer to points of interest that are important to them and that differentiate you from your competition. The more these points are of interest to buyers, the more you can charge.

Now be careful with this because unless you plan on staying a one-man operation you need to make sure you do not focus the questions on what you bring to the table. I see inspectors make this mistake all the time. They say things like- “I am code certified, I have 20 years experience, I am a master plumber, I am a past home builder.”  All of these can be useful at first but when you try to bring on a second inspector you have just created a problem.  Will your second inspector be code certified, have 20 years experience, be a master plumber, and was a past home builder? Not likely.

As you create your company’s Unique Selling Positions – make sure they are based on what you bring to the table as a company – something that everyone you hire can bring to the table as easily as you or the third inspector.  If you read the questions that I used above, you will realize that every inspector that I hire can offer these services.

So, when a potential homebuyer calls and asks about your price – you might want to say “That is a great question – may I ask you a couple of questions to calculate that for you?” In the process of asking the questions you will make sure that they know what makes you different from everyone else who they are considering– help them understand that price should be one of their least concerns.  Ask questions like – How soon do you want the report? Would you like to have color digital photos with the report?  Would it help you to know that we absolutely guarantee your satisfaction?

One of the things that I teach our coaching members it that when talking to a client on the phone, they should make sure the homebuyer knows what makes them different. We try to help make sure they have at least four things that make them different than most of their competition, and one thing that completely separates them from the competition. When you can do this, you work in a competition-free zone, which allows you to charge a lot more than so called bottom feeders.

One trick I used when the low-priced inspectors came knocking at my door – or at my prospect’s door – is to beat them at their own game.  I started giving inspections away for free!  It is hard to get any lower priced than that.  We answered the phone when folks called with “Thanks for calling Affordable Inspections, have you heard about our Free Home Inspection?”  At the end of the day “Free” beats every other price. Just to give you a feel for this – and keeping in mind that we did 400 to 500 inspections a month, we would have a drawing once a month and give away an inspection up to a certain price point.  Let’s see the cheap guys beat Free!

I hope this helps – don’t let price be what makes you different and don’t let your competitors set your price.  Give your clients something no one else does and charge what you want.

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About the Author
Mike Crow works with hundreds of inspectors across North America helping them to market their business and put systems in place to help move their business forward. You can receive a Free CD with more secrets and get more marketing information at www.richhomeinspector.com – tell him you saw him in “Working RE”.  To have your question answered about marketing your inspection service email DreamTeam@MikeCrow.com

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