This week: In this newsletter, I’ll show you quick hacks and tips that will increase your margins on most jobs. We will also deeply understand why most blue-collar technicians keep struggling financially, even though they work incredibly hard!
WHY SO MANY SKILLFUL BLUE-COLLAR WORKERS KEEP STRUGGLING FINANCIALLY?
Plumbers, electricians, garage door technicians, locksmiths, and more… invest endless time and energy into mastering their crafts.
For them, the equation is very simple: More jobs done = more money.
Most of them have a very narrow path of thinking: that they should set their prices according to local market rates.
“The average electrician in Cleveland, Ohio should charge $X an hour.” “A garage door opener installation should not cost more than $175.”
They want to be “fair.” They don't want to charge more and come across as scammers. They want to be people of honor and integrity.
And guess what? I was just like that.
I used to suffer from this wired equation in my head:
CHARGING MORE = A SCAM.
The biggest problem with technicians these days is that they are not maximizing every customer. They are trusting their good luck—hoping that at some point the customer will recommend them to more prospects or call them again.
In some very specific cases, you absolutely don't want to push it and maximize your prices:
If you are a locksmith called by a car dealership to perform a job, you want to be delicate with your prices. In that case, they may use your services on a regular basis.
If you are a garage door technician, electrician, or plumber going to a new customer who was referred by a previous customer.
And the list goes on. These are specific cases. With all the rest, from my perspective, you want and need to maximize.
The Coffee Test
This is a simple concept that most people don't pay attention to:
👉In the average gas station in the US, you will pay $2 to $2.50 for a small black cup of coffee.
👉If you buy that same size black coffee at Starbucks, you will pay around $5.
👉if you drink that exact same coffee in a 5-star hotel or a nice airport lounge, you will pay $7 to $9.
Why? The answer is:
⏰Urgency
📌Experience / Location
😎Brand
Urgency: How fast do they need the service or the product?
Experience / Location: What kind of emotional or situational experience are they having?
Brand: Who are they buying from?
In the coffee case study, the answer is obvious: The gas station is accessible but non-branded. If you sit with your laptop and a cup of coffee at a Starbucks on 5th Avenue in NYC, you are buying a brand and an experience.
Meanwhile, if you are in an airport lounge, buying that coffee is highly important to you at that moment—so you willingly say goodbye to $7 to $9.
I call them - “THE BIG 3”.
How can you use these "BIG 3" in the blue-collar domain to your advantage?
Here are a few different ways to charge more using these exact same methods. The best part? They make total sense to the customer. They might not like paying more, but it will logical to them, so they will pay.
1. After-Hours Fee (Urgency)
If you provide a service after 7 PM on weekdays or anytime during the weekend, charge extra. If the client needs the service here and now, they need to pay for that speed! (Example for a receipt)
“Because the time is after 7pm, there is a afterhours fee of $97.” ☕
2. Out-of-Area Fee (Location)
Sometimes customers in smaller towns or distant areas have zero access to local service providers. You are their lifeline. If you agree to make the trip to inspect their plumbing, chimney, or garage door system, you tell them up front:
“Because you are out of our standard service area, there is a travel and diagnostic fee of $125.” ☕
3. Branded Parts (Brand)
If you are a locksmith, for example, and you are about to make a Ford car key for a customer, some clients will demand an "ORIGINAL" key—the one with the official Ford logo on it (AKA an OEM key). This is an immediate opportunity to maximize the ticket.
You tell the customer:
“For an aftermarket key, it’s $350.” “For the official OEM key, it’s $460.”
Guess what? A massive percentage of people out there are more than willing to pay extra for the real deal.
As you noticed, because this technician—no matter his field—knew how to give a reason and a dedicated section related to each one of the BIG 3, he was able to increase the overall deal size. This is GREAT—especially if he works on a percentage basis. He can make way more for his time, efforts, and professionalism, instead of being compensated so little.