Advice on Pricing Repeat Clients

I don't have an answer. But I want to remind one and all that good times, and bad times, come and go. One day we will all be short on work. Plan accordingly.   

Do not worry about dropping your price because you absolutely do not need to do so.  If you did a job two years ago, they will understand that you will probably cost more this time, just like everything else they spend money on.  I avoid this by not having any kind of fixed price for a specific category of job.  I've seen a single lot in town cost more than a 160-acre job in the country simply because of lack of nearby monuments or nearly inaccessible key control or a mess based on the plat of the subdivision from 1880.

I do a tremendous fraction of my work for former clients.  Some from 30 years ago and others from last month.  A new job is a new job.  The rare exception might be a case of the client has now purchased an adjoining lot or two for which they know I have all I need to know to determine where to set the two new bars.  Easy money, but, probably less than trying to resolve the original survey I did.

Simply explain to your repeat client that you normally do not do construction surveying (or whatever service it is you normally avoid), and your cost/fee for those services is going to be higher than average. If the client is willing, then all concerns are clear.

Further, when it's additional services on a project, I wonder if I have an ethical obligation to provide 'fair' pricing; having completed work already, even at a premium my price would be less than them having to call in a completely new surveyor, but I don't like the feeling of having my clients over a barrel.

That's not you having your client over a barrel, that's you having an advantage over your competitors.

The ethical responsibility is to not place profit above service, but that doesn't mean we are obligated to make razor-thin margins just because it's possible to do so. Basically, we should not seek increased profit by compromising service.

The service is worth whatever it is worth; if your competitors would be charging X to do something that you could do for half of X (and make minimal profit), then the value of that service doesn't automatically default to what you could charge, but likely somewhere in between. That can vary depending on the economy, workload, their current needs, project complexity etc.

I have always perceived a good client relationship as less about cutting a deal and more about providing quality service in a timely fashion, while paying close attention to their needs. It shouldn't be about pricing, but value.

Outside of work, I'm a repeat client for a lot of various services, and the vast majority of them don't cut their prices for me. They usually just remember me and give me good service.

I don't change my pricing for clients during a project. The time to do it is when they come back for new work. In fact, there are some clients I'm locked into a rate until it's renegotiated. 

But going forward with a new project, for sure up your rates. 

If you have completed your contractual obligations for previous clients you have no obligation, ethical or otherwise, to provide additional/new services for a lower price structure than you are charging new clients.  Of course there will be limited exceptions but we work in a cyclable economic environment where it's either feast or famine the work loads that we are experiencing currently won't last forever.

Most great Surveyors tend not to be the best businessmen.  You have obviously positioned yourself decently with an eight week backlog but the majority of the current work load will, and I said, will, dry up.

The trend that is going on now defies economic history and past market conditions.  We now have interest rates at 6% + and rising, rising existing housing values and new construction that has yet to slow down in my area.  What we're dealing with now equates to the perfectly stacked house of cards with the storm brewing.  That house of cards is soon going to be swept away by the storm.

In my opinion and 40 years of experience, you should be charging as much as your local market will bare and stashing away as much cash as you can to weather the storm when it hits.  The perfect example of what I am saying is the market crash of 2008 that forced a ton of Surveying & Engineering businesses to close for good and had a ton of us unemployed.  When you are setting your rates it is important to think about being financially able to survive the cyclical market downturns.

@chris-bouffard grandma always had tissues because she knew we would need to blow our nose. She always had an umbrella under her seat because at some point it is going to rain. 

OP charge whatever you can. Don’t cheat people but you have the liability and you have done what was necessary and spent who knows how much time studying eating ramen noodles and working to get to the point you are. I have my own business not surveying. I charge for bush hogging and hay. Now i have some elderly people that are friends we are talking 90’s I sell my hay to them same price as anyone else. Now after a storm or something they are now a neighbor and me and my 2 daughters will go over and clean up the yard and he pays them a little as i will not accept that money he is a neighbor. But he raises sheep thats his little business. My hay business and his sheep business is business. Cleaning up a fallen tree across his driveway and limbs thats not my business its a neighbor helping each other out. You can always lower a price. Raising a price raises awareness on both sides. Sounds like you have got some repeating clients so you give a price and probably know from reaction if you are too high. Then maybe you say i can maybe do a little lower this time. But if you go low in beginning you will keep going low. But don’t go so low you can’t make what you need .  Good luck.  

One day we will all be short on work. Plan accordingly.   

A good reminder, I picked a fortuitous time to strike out on my own, I shouldn't fool myself into thinking it's forever.

That's not you having your client over a barrel, that's you having an advantage over your competitors.

Thanks, I like this reframing of the circumstance.

I have always perceived a good client relationship as less about cutting a deal and more about providing quality service in a timely fashion, while paying close attention to their needs. It shouldn't be about pricing, but value.

Thanks for this as well, it's telling me something in affect I knew but didn't recognize. Just recently I worked with a guy who brought me a property to subdivide he had just acquired. Pulled the record, his seller had it surveyed not a couple months before. It's a bear of parcel, would be several days to retrace. I advised he call the other guy, he's already got the parent parcel in the can. Client asked if he could pay me to sub the other guy, or serve as a liaison, he'd rather just deal with me than someone new. 

The particularities of that situation aside, it's a reminder and evidence of what you are telling me. Returning clients may not be returning for the price, but for the experience and value.

I don't change my pricing for clients during a project. The time to do it is when they come back for new work. In fact, there are some clients I'm locked into a rate until it's renegotiated. 

I offer 'lump-sum' quotes for all new work, so in the case it's about how best to price additional services outside of the lump-sum. I'm now trying to communicate my rates and that anything outside of agreed scope will be hourly. Saying is one thing, doing is another, I don't want people to feel like they are nickel and dimed for an extra service they believed to be included.

In my opinion and 40 years of experience, you should be charging as much as your local market will bare and stashing away as much cash as you can to weather the storm when it hits.

Good advice, and a good reframing. I get uncomfortable with the idea of having charged two clients dissimilar prices for similar services. But the fact is I have to charge what the market will bear, because in the future the market may bear a lot less than what I need.

Thanks to all for the responses and counsel.

this is another awesome post!!!

This site still rocks and will progress forward to the new one woohoo!

I don't want people to feel like they are nickel and dimed for an extra service they believed to be included.

Well that's a scoping issue and not a pricing issue.

@olemanriver I don't go low at all, a neighbor helping a neighbor is not a business issue, that's something we all should be doing as good humans.

I have six crews, seven trucks, eight sets of TS and GPS packages and a total of 30 people in my department.  All of the rigs and equipment need regular maintenance, employees get annual and merit raises, health insurance goes up every year and inflation is killing us all.

We have a total of 82 employees with every one of them using paper, ink and toner every day.  We have rent to pay and utility bills, as well as buying office equipment and software to stay competitive.

Our cost of business raises, sometimes on a daily basis so why should our fees not?  Our repeat clients are either title companies and development companies working on multimillion dollar projects.  They don't bat an eye at our prices because they get fast turnaround times with quality service.  If you treat your clients right, and perform as promised, you will always have their loyalty.

@chris-bouffard thats so true for sure. Everything has gone up so our prices as well. It is crazy times. I picked up 1k well less in supplies last week that was just to get a out of town crew the items they needed for a week as bulk order is behind. Doesn’t fill a shoebox hardly lol.

@olemanriver trust me, we run through 50 bundles of stakes & lath, cases of paint and tons of flagging every month, not to mention monuments, re-bar and other incidentals.

@chris-bouffard good grief. I remember as a crew chief in the 90’s we had a person that delivered truck bed load of supplies to us at a job site because we couldn’t fit what we needed in surveying truck as we were out of town 6 days a week. We had a construction trailer on site. Boxes of paint flagging hubs etc. yeah you have a lot going on. As i get some of this other stuff down i am now getting tasked with proposals. So i did one this weeno one has taught me anything i am guessing on what i do know. So far i am higher than my boss but getting closer. Hopefully one day he will actually show me how he does it. I don’t know how he did one project lower than i fuel stakes needed and some other supplies plus pay for crew cuts it close lol. I will learn though.

@olemanriver 

Don't remind me.  Over 40 years ago I was working on a construction site nearly every day for two months.  One day the Job Superintendent and I were discussing wages and he told me I wasn't making nearly enough money.  I didn't know what he meant, so I asked him how he knew what I made.  He said the company was only charging him a specific cost per hour for my time and that turned out to be about $2.50 per hour over my wage.  He was suggesting that if every penny they paid went directly to me, I was still underpaid.  Clearly, the boss had no idea what the value of this service should be.  At the moment, I was just content to have a job where I wanted to be.

@holy-cow yeah. I am trying to juggle learning what i need surveying wise and also juggling the cost and proposals type stuff. We have no administrative person at our location so we are a new office and I cringe every day as i do my time sheet and my time is done doing things that is not billable. But it is necessary. Keeping up with 3 crews and my boss is running himself ragged trying to bring in work and i am trying to do everything else plus learn what i am not good at. Today was a day that was just crazy. On hold on and off for an hour as one of our trucks was placed in the shop go get brakes done. 2 weeks. No pads covid. I have one chief down for surgery and another has a surgery coming so i have no i men or rodmen. A job that’s due end of the month that nothing has gone easy yet on. Today we finally found a adjoiner plat. From land owners sister . I ran it in it doesn’t close by feet. But we have no monument’s hardly washed out in two different floods. But found some old locusts post parole evidence on some other information. I took and converted the magnetic bearings to true from 1947 ish then to grid which we were on best fit the line to locust post. Several then to river and creek. Nailed a rebar that was set on a old fence line by 80 year old owners dad many years ago pre flood. Not a corner but alignment hit the sucker by .15 ft. Row is matching ok. I gave the guys some search points and they found a rail road track vertical withen a half foot. So tomorrow back to wiggle that sucker in more I guess. The wife is upset the ac is out at the house. And I still can’t get the truck back and i need it to send crew out of town next week. Lol. Almost as bad as hay equipment breaking down and storm on its way

Saying is one thing, doing is another, I don't want people to feel like they are nickel and dimed for an extra service they believed to be included.

A key takeaway here - be very specific in your contract with what services or products are included in your contract.  Anything outside of that is fair game for additional charges at prevailing rates.  Those add-ons can be quite lucrative.