Consultations: To Charge or Not to Charge?

The original article can be found here. 

I got a phone call from a SynkedUP user and friend yesterday, wanting to think out loud through the consultation fees he was charging. He had been charging $150 for a consultation for a few years now and hadn’t been getting any pushback.

Until now.

There was some new competition in town, and they weren’t charging any consultation fees. He did learn that their quotes were similar in price though, so it’s not like it was an apples-and-oranges comparison. They were chasing the same type of jobs, and charging similar rates. He had several leads tell him “well, these companies aren’t charging me fees to get an estimate, so I’m just going to get quotes from them.”

This, and the fact the volume of leads is a little less this year than last (for him in his local market) made him doubt the whole idea of charging consultation fees. I’m sure there are more of you out there facing this same reality, so I wanted to share kind of where we landed in our conversation in hopes that it’s helpful to more of you out there.

After about a 20 min conversation, here’s where we landed:

• The purpose of consultation fees is not to make money, it’s to save you time.
• He was still getting enough paid consult leads to fill his schedule

Consultation Fees are Not to Make Money

The purpose of these fees is not to make money, not even to recover your costs of gas and time. It is solely to filter out the leads that are not serious and not going to buy from you anyway. I don’t care if you charge $5. It’s the fact that a transaction is taking place that matters. You are not in the business of collecting consultation fees. You are in business to collect deposit checks. The consultation fee simply helps you get a deposit check more often, than if you weren’t charging a consult fee. Essentially saves you from wasting valuable time, and frees up time to spend with the NEXT lead that calls in, IS willing to pay your consultation fee, and is far more likely to give you a deposit check.

That, or you get to eat dinner with your family instead of driving out there to meet someone that was never going to buy from you anyway, whether they knew it or not.

Maybe they genuinely THOUGHT they were going to buy from you until they realized that their favorite backyard idea photo from the gram is going to cost $150-250k, and they were thinking $20-40k. Happens all the time.

Asking them to pay a consultation fee before coming out forces them to do a reality check and ask more questions over the phone or on your website. In about a 5 min phone conversation and/or a couple of text messages, they’ll be able to find out that yes, what they are looking for is in the $150-250k range, and they’ll thank you for your time and hang up. And you didn’t have to drive out there for them to discover that.

Side Tangent

Now suddenly your head starts thinking about “how can I educate the customer as to what things cost?” And you start burning your energy on how can you better educate your customers directly on your website and online presence, to save even that 5 min phone conversation. At Tussey Landscaping we did this with a Project Planner that the lead had to fill out AHEAD of time before the designer showed up for the scheduled consultation. It was more about educating the customer as to what things cost than it was to get their budget. Although getting their budget range is helpful.

The entire goal is to get your services to the right people. Your target audience is those that can and will buy from you. And avoid beating yourself up when you get the umpteenth “no” from a customer that was just not a good fit for your business to begin with. It’s a game of finding the RIGHT customer, not all customers.

Now, are there enough RIGHT customers in your market for the service you offer?

That’s a different question.

Maybe you sell Lambos but there just are not enough Lambo customers in your market. Maybe you need to expand your service offering that inherently expands the size of your target customer audience. But that’s completely different than trying to sell Lambos to customers with Impala budgets. That game is a game you’ll never win. Adding Impalas to your line of service offerings so you have something to sell to those customers with those budgets IS a game you can win.

Back to the consultation fee, it is there solely to make sure that if you sell Lambos; you’re talking to Lambo customers. It forces customers to do a quick reality check and ask themselves if they really ARE serious about buying. Saving both of you time.

Are you Getting Enough Leads to Fill Your Schedule?

This is the other question we discussed on our phone call. I asked him “Let’s say you keep on charging the consultation fees, will you get enough paid consultations to still fill your crew’s calendar?”

For him, the answer was yes. He’s booked to August already, and he’s confident he will easily fill the rest of the year. Even if he keeps right on charging for his consultations, and get’s a high percentage of no’s. For him, he only needs a few jobs to fill out the rest of the year.

It’s funny how the things that don’t even matter, torment and stress us out. So the volume of leads he got that were price shopping went up… Causing more people to refuse to pay his consult fee… which made him doubt his process. But when we were talking about it, stopped, and looked at the situation, he was still confident he’d sell what he needed to fill his schedule. Which let him logically process all those “no’s” and be ok with it, not stress out about it.

Now, there’s always cause to constantly be watching and evaluating your process. I’m not advocating being bullheaded about sticking to your process. There can be times when the process needs to adapt to external circumstances.

For example, if you needed hundreds of small jobs to fill out the rest of your year, that may be a different story. Consultation fees may not be an effective method, and you may need to find a different way to vet your leads to ensure they’re serious. That’s all that this is about anyway. Vetting your leads so you don’t waste time with people that never will buy from you anyway, robbing you of your precious time.