In Part 1, I challenged
you to make a list of special services that you believe will benefit
customers and your profit margin.
What services made up your personal
"top 10" list? Requests can run the gamut, from the simple act of
picking up a gift certificate to ordering a collectible valued at
$1,000.
If you’re ready to explore
incorporating special services into your gift basket business, here are
four ideas on how to set up this specialty, develop parameters and
profit form this offering:
1. Set an hourly price for
travel as well as a set minimum. For example, charge $20 per hour to
find specially-requested products.
The $20 will be applied to the order
whether you used 6 or 60 minutes. Pricing your time creates value and
alerts clients to the fact that your business is not a hobby.
2. Add a percentage over
and above the price of the product when it is specially purchased for
basket inclusion.
In other words, if the retail product costs $10,
charge the client $10 plus anywhere between 20 percent to 30 percent
extra for it. If you add 20 percent, this amounts to charging the client
$12 for a $10 product.
Travel per hour plus a
markup over and above the retail price. Will the client pay for this
service? If yes, you’ve found the type of buyer who values your service
and product. If no, you can either stop this service or continue, paying
for the costs out of your own pocket. If your monthly profit and loss
statement shows more of a loss than profit, live with it or make a
change. It’s up to you.
3. Start charging for the
prototype products you buy for sample baskets. Many designers buy
products to use as prototypes for what may be a sizeable order.
If you
travel to find specialty items and then show the prototype by way of a
Emailed or snail mailed photograph, charge for this service unless the
payoff is going to be so grand that you don’t mind taking a chance on
buying prototypes.
For example, one gift
basket designer charges a flat rate of $25 per sample prototype, which
can be applied to a future order. How does she do this without
alienating clients?
She’s been in business 8 years, and her reputation
for excellent work is known throughout her town. When her gift basket
business is discussed between customers and prospects, her terms are
part of the conversation. Clients know that the $25 is money well spent
because she provides the best.
4. Know your limits.
Remember the satanic Bible mentioned in part one? If this or other
products are items you won’t purchase due to religious beliefs or other
reservations, place a disclaimer in your literature and on your Web
site. State something such as, "We will make every attempt find your
specialty items. However, there are certain products that we may not be
able to purchase."
The bottom line is that if
clients want specific products, the cost won’t matter. If it does
matter, they’ll reconsider and buy something in your inventory. If they
walk away, consider that the person wasn’t your ideal client.
Create your own "terms and
conditions of service" and put it in writing in your catalog, on other
literature, and on your Web site. Don’t reinvent the wheel. Scan through
catalogs you receive in the mail to write a policy.
Your time is important.
Let clients understand this by putting a price on it. You provide
products and services, both of which are valuable.
Perhaps after reading this
you’ve changed your mind; providing special services is not for you.
There’s no harm in stopping before you start, as long as you’ve looked
at the pros and cons of the service.
Those
of you who enter this venture will surely make policy changes along the
way, and also make more frequent stops at the bank.
©Shirley George Frazier. All rights
reserved.
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