What Do You Do When Customers Question the Cost of Service?

Be up-front about what tasks may be DIY jobs and customers won’t diminish the value of your work when they really need your expertise.

What Do You Do When Customers Question the Cost of Service?
Anja Smith

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Property managers and real estate investors can mean steady, reliable work for plumbers. If you are willing to provide terms, these groups might be the exact engine of growth your company needs. But that doesn’t mean you want to work with everyone who calls themselves a real estate investor. We all know that the ideal and reality don’t always align.

If you deal in the property management and real estate investment space for long, you’ll hear the term “investor friendly” thrown around. While the term might work as a selling point for turning a doctor into a real estate dabbler, it should serve as a warning sign for plumbers and other service providers. There is nothing wrong with wanting to maximize your return on investment. No one is demonizing capitalism here. But the problem is that this term has become code for a property manager who is willing to cut corners. It’s a euphemism for cheap.   

There are areas of life where cutting corners isn’t a big deal. Boxed cake mixes make a decent tasting cake and single-coat paint can cover one tan with another just fine. But installing a water heater or replacing a sewer line is not where you want to cut corners. Plumbing, in general, is not where you want to go the cheap route.

But that doesn’t keep these “investor friendly” operators from telling me that my prices are too high. What I’ve noticed though, is they always seem to think prices are too high on the small stuff — the leaky faucets and toilet rebuilds. On major projects they find the price more than fair. Funny, because both are built on the same hourly rate. How frustrating.

The culprit here, of course, is perceived value. Replacing a sewer line is “worth” a few thousand dollars, but replacing a flapper isn’t “worth” a buck. The problem is I have to pay my plumber the same rate, no matter what task they are doing. Liability and health insurance cost the same, no matter what task they are doing. Truck inventory costs the same, no matter what task they are doing. Gas and advertising and … you get the idea.

The thing is, in some cases, these customers aren’t entirely wrong. It’s true — replacing a flapper doesn’t take a plumber’s expertise. An experienced handyman can accomplish this task easily and typically at a lower price. Plus, I’d rather focus on more profitable jobs. By all means, call a handyman to change a flapper. Or better yet, roll up your sleeves and do it yourself. It’s called empowerment.

Yes, this is a bit controversial. Even within our ownership team there is discord and debate over this topic. After all, as plumbers we fight for customers to recognize our value all day long. But the reality is that many products are now made for DIY servicing. That doesn’t mean plumbers don’t have a place in the world. They key is being a part of that conversation and having the opportunity to guide it. Luckily, most real estate investors and property managers know a thing or two about maintenance. For those customers who want the one-stop shopping and comfort that it is taken care of, we have no problem servicing simple plumbing tasks. But for those who don’t see the value in our hourly rate for simple tasks, we encourage them to look elsewhere. That doesn’t mean they won’t need a real plumber tomorrow.

The important thing is to not write these folks off. Don’t lecture them about your cost of doing business (even if it is tempting) and don’t apologize for your pricing or make excuses. Just agree — when appropriate — that the task could be done by a less-qualified individual.

By concentrating our service on more complex and specialized-tool intensive tasks, we increase our actual value. Not just our perceived value. Fighting the wider trends of the industry is not just futile, but potentially ulcer inducing. Your frustration isn’t going to make push-to-connect fittings go away or a toilet flange harder to replace. Instead, arm yourself with the skills that customers can’t do themselves. And be there to clean up the mess when they get in over their heads.

Embracing the specialist mentality can help your business thrive. Invest in continuing education, learn about cutting edge technology, and get the right tools. Yes, sometimes this is the hard work. But that’s why they pay us the big bucks, right? That is literally the correct answer. We earn more when we do the hard jobs.

The next time an “investor friendly” property manager tells you that your rate is too high to change a flapper, agree with them because that doesn’t require someone of your expertise and skill. They can call you when they have a problem that does. Then you, your crew, and your equipment will be worth every penny.

About the author: Anja Smith is managing partner for All Clear Plumbing in Greenville, South Carolina. She can be reached at anja@acpupstate.com.


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