Maintaining a healthy profit margin is no small task for AV system integrators. It takes having a strong brand value, consistent measurement of performance and solid leadership. Even with all those fancy ingredients, there is room for that recipe to miss the mark when unforeseeable project hiccups derail your planning and tack on unexpected costs. So what do we recommend?
Charge more! Pricing is always a factor when making a purchase decision, but it’s not the only consideration. Ultimately, clients choose the company who they believe can solve their problem most efficiently and deliver the desired results. Below are a few ways D-Tools Cloud can help you present pricing confidently to achieve your profit margin goals:
Take advantage of category suggested labor – Using our Product Library. Every product you add from the D-Tools Product Library has a suggested installation time associated with it that you can easily adjust. Why? Experience has taught us that the most accurate and efficient way to manage labor is to start at the equipment level – which ultimately bubbles up to the proposal. This “set it and forget it” approach to managing labor significantly speeds up the quoting process and can help identify areas where you may be underbidding labor. Stacking multiple types of labor that you sell (at different rates) onto a single product is also valuable. Please proceed with caution; your quotes may become more expensive :)
Capture miscellaneous costs – Using price adjustments. There are always surprises on projects and adjustments that you make on the fly to help get the job done. By using our adjustments field, you can easily capture and prepare for those costs as a flat amount or percentage of the job and transfer them onto the client. Now you’re covered for those extra runs of cable, the zip ties, and don’t forget about the connectors.
Protect your design intelligence – Using visual quoting. AV system design time is often overlooked or given away. Realizing that most companies can and should charge for this (even if done by sales or a technician) will help increase your bottom line. The good news is most people feel comfortable paying it, knowing that it goes towards the cost of the project. So make your quote stickier by providing a drawing using visual quoting and gain commitment early in the process. If they end up choosing another provider, at least you were compensated for your time.
Charge for materials management – Using labor types. Receiving, staging, picking, and delivering items to a job is a key function of completing the project. It requires time and planning. Simply create a new labor type and add it to the appropriate equipment (see screenshot above).
Offer training – Using allowances. Helping clients become familiar with how to operate their systems and supporting them is a given (especially in the beginning). However, defining the scope of what that means and for how long will set appropriate expectations upfront—allowing any requests beyond those parameters to be considered additional.
Extend your customer journey – Using alternate sets. By offering service plan options or preventative maintenance, you can engage clients to select a plan that allows you to continue servicing them beyond project completion. Clients love having peace of mind knowing that no matter what happens, they are covered, and it allows your business to ensure their systems continue to perform as expected while building recurring revenue. Truly a win-win scenario.
As demand continues to grow and projects become more complex, we hope these tips help safeguard your margin and protect you from the unexpected… you’re worth it!