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Really Bad Advice for Small Business

6:41
102.4K views

Video by Stanley "Dirt Monkey" Genadek

Stanley "Dirt Monkey" Genadek

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This video details a business strategy for implementing tiered pricing models for services, drawing a direct analogy from the expedited shipping services offered by companies like FedEx and UPS. The presenter explains that customers are conditioned to pay a premium for faster service and higher quality, demonstrating this with real-world shipping quotes. He then encourages viewers, particularly those in contracting fields like landscaping, to adopt similar next-day or expedited service options to increase revenue. Please note: The content of this video is unrelated to 'Paint > Accent Walls & Finishes > Specialty Paint Application > Textured Paint Design using Trowel Techniques' and focuses entirely on business pricing strategy.

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So, a few of you guys out there are absolutely flaming me. You've seen some of my videos where I'm putting two yards of mulch in and I'm charging $1,200 and you're saying, "Oh, you're ripping people off and you're taking advantage of them and all this and that and the other thing." No, you guys, I want you to think of FedEx. I want you to think of UPS. I want you to think of the United States Postal Service. Oh, the chicken the gal at FedEx. Feisty. [Music] Let's try UPS. Let's see if they'll let us film inside. Maybe. Probably not. Who cares? We'll still get the pricing. What do these guys all have in common? Let's break it down. They all deliver mail, but both FedEx and UPS have done something that took mail delivery to the next step, and that is they focus on overnight delivery. Now, they also charge a premium price to bring your package to the same place that the United States Postal Service will do, but they'll charge you two, three, four, five times. I don't know how much. The gal at FedEx, she was feisty. Oh crap. I asked her if I could videotape her giving me the quotes on this. No, you can't videotape me. I think she was a gypsy. A lot of attitude. I loved it. It was actually kind of fun. Somebody just, you know, not not bending over and letting you do whatever you want. But here's the quotes that FedEx gave me. Priority mail overnight for a 53lb box, $349.76. Shipping the exact same package today, so just one extra day, $261.38. And then regular delivery. Whenever it gets there, it gets there. $6329. Use that as a business formula for your pricing. If you have someone saying, "I need it now." Well, guess what? Ben Franklin, the punctual plumber does it. There's an electrical group that does it, Sparky or something. There's businesses that there are contracting businesses that their sole job is delivering fast. They don't do it any different than you do or I do. Shipping options, right? Yep. So, you got UPS Ground 7452. Okay. You got uh let's see 3day select which is still a ground service but isn't within 3 days. 17350. Okay. So why can't you price out your projects in accordance with how fast it has to be done and possibly put a little extra cha-ching in the in your back pocket? FedEx does it. UPS does it. Other places do it. Why aren't you why? Just tell me, brothers and sisters. Why aren't you doing it? They're doing what the United States Post Office has done for years and years and years, only better, only faster, and they can charge more for it. And they've built billiondoll corporations doing exactly that. Now, one of you guys out there, you're going to get clever. Presentation is a key component to selling those high-end jobs, those fast jobs to make yourself stand out in the crowd. Now, you seen the proposal that UPS gave me to ship a 53lb box to 90210. That's their proposal. This is the proposal that the FedEx Gypsy gave me to ship the exact same container to 90210. You're going to come up with the landscaping company and it's going to be called Next Day Landscaping. And what you're going to do is you're going to deliver landscaping at premium price the very next day. Now, you're going to get booked. And so, what you're going to do is you're going to give your customers options. You're going to tell them that if they can wait, they get the standard fee. If they got to have it done within a week, well, here's the expedited rate. And if they absolutely positively must have their landscaping project completed by the very next day, well, guess what? That's going to be the premium price of all premium prices, plain and simple. And then you go into the second day air option. Second day at 266. Got it. Uh second day air A.M. by 10:30 a.m. would be 3:0593. And next day air saver 3339 sorry 3336. So Okay, perfect. And that's a 53lb box 11 by 11 going to 90210. Exactly. Perfect. And all of your shipping details are all right here on the side. And then you're going to get it. You're going to understand customers are conditioned to pay a premium price for expedited service. And it's nothing that you and I have done. All these big companies out there have already put it into their brain that it's okay, that it's a standard to pay more, to have your job done faster, to get better quality. You have different levels of quality and you can charge for things like that. It's already out there. There's no reason why you don't do it. There's no reason. They laid it out. They clearly explained everything. The FedEx Gypsy ploped this down, wrote it down, and pretty much pushed me out the door. Even though the FedEx Gypsy's rates are a little bit cheaper, I wouldn't go with them. If I didn't know what was happening and it was more complicated than a simple package delivery, there's no way just because to save a few dollars that I would go with the FedEx Gypsy. In this case, I would go with UPS all the way. Are you the FedEx Gypsy or are you the UPS store? You decide. I love you guys. I hope somehow this has helped you out. Let me know. I'll stick it in the

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