Getting new business as home inspector

[dbronsted]

yup yup..im new at this too...trying to figure out my market..i live in a small town..well not to small ...if anyone could tell me how to get repo inspections.. do i go to loan officers at banks or what??...im taking some flyers around the end of this week. Ive got to tell you all though...i have been cleaning rental cabins (3 story luxury type) to make an income till this is up and running..and i am for keeping the rates up for home inspection..right now i clean allllll day and make between 65 and 100 dollars ...last year i was building them..cant do that no more..lol

[Tyler Wierzbicki]

What about doing "home inspections" inside high rise buildings, condos, and the like. There are a lot of those here in San Francisco, are there certain requirements and training that I would need or could I use all the same tools as for a regular single story home inspection?

[gporter]

Originally Posted by klott

There is a inspector Millionaires club and there bankrupt inspectors, it is up to you.

and the market

[jmichalski]

Originally Posted by jjonas

Have you checked your local competition's rates??? Discard the highest and lowest, average the remaining, add $25 to the average.

As a newbie, that is a formula for failure.

Since I read your descriptions and found that for a full inspection of all systems, your price is higher, I am not worried that you are underselling.

Shop your competitors (the main ones, guys who are established). Throw out obvious lowballers (anyone who is $199 when the competition is $299 and up, for example).

Take the lowest competitor and price yourself to compete with them.

While many here will howl at the advice, they cannot deny that there are WAY more price shoppers than there are boutique shoppers. Ask home inspectors what question they get asked most frequently, and most (if honest) will tell you "How much?"

For those that worry about where your prices are - let them worry. It isn't your problem. You are trying to capture all the work you can, and having an attractive price will help you close sales by accident.

I was where you are once. (I also used to be an interNACHI member) I tried the "price high" method (which I call the nick overprice strategy). My phone did not ring. Local realtors know the guys who have been around awhile and can justify that kind of rate. Clients can tell on the phone when you are a little raw, and can't back up your prices. I was not booking inspctions.

So, I re-evaluated my strategy and took an aggressive price strategy. I read, and askedquestions (like you are) and followed the advice of Russel Ray (a guy here who has alot of good marketing advice). Business took a HUGE upswing. 3 months later I added more RR ideas....more business. And so on, and so on.

His advice was dead on accurate and worked perfectly. Most guys will howl at the advice and offer some pablum like "you are worth what you charge" or "you get what you pay for." Nonsense. Do they shop at the most expensive gas station, because by their reasoning that must be WAY better gas? Do they willingly pay more for their tools or insurance - because price dictates quality and value, right?

The truth is, you are only as good as you are. And only you know how fgood you are. But even the best, most qualified inspector needs to start somewhere and without a sudden influx of business he will be a very qualified inspector working for someone else.

One last note - develop a busines plan and amarketing plan and stick to them. Write down your plans, goals and objectives (it sounds silly, I know, but written goals are harder to fudge, ignore or slough off).

And keep asking and reading. Good luck!!!!

[Nick Gromicko]

www.nachi.org/success.htm

[jmichalski]

Regarding ASHI or NACHI.... you really need to find where you fit in the grand scheme of things. I used to be a NACHI member, and a very active one. When I joined, I liked what I read, like you may.

There is a lot here. There is also a whole world outside of here. You need to find what best suits you. For me, that is not InterNACHI. There are people here I respect highly (Russel Ray, and Dale Duffy to mention just two) and things that I found helpful.

I have found that I am happier elsewhere, but I would not have known that had I not participated here first. My advice - take all the advice (even mine) with a grain of salt, and take all the hype and cheerleading (for any assocaition) with a fistful of salt (most of it never pans out to anthing).

Again, good luck!

[relliott]

So if I am reading right and not in some kind of night mare your mentor wannabe is telling you people calling will know you are new to the game with no experiance but will hire you anyway.Hmmmm
What kind of idiot will call for a professional inspection while looking to save 25 bucks on a million dollar investment.If they are so keen on knowledge that they can tell you are new , what the hell are you needed for?
The reason people ask what the price is right away is because they do not know what to ask and your job is to answer the questions they should be asking.By the time you are done answering questions and letting them know what you will do for them they will be happy to hire you.
This is unless you have no idea what to say your self in which case they will not hire you anyway.
When JM is refering to price shoppers I suspect he is refering to Agents (nudge ,nudge).
You can bust your butt and and do quick inspections for them with your eyes closed while increasing your risk of getting sued for being to scared of losing all the low pay business your partner(opps) referer is sending you.
Of course at this point it will be to late to become a good inspector as none of your past clients will be refering the blind inspector.
I guess the choice is yours.
As for myself I spend time studying and learning so that when called upon my reputation will not suffer.
When it comes right down to it you are selling yourself and your reputation is all you have.
How does MJ sleep at night (ask him for I do not know)
I sleep well knowing that I go for the high end intelligent people that will boost me up to where I know I belong.
A bottom feeder is just that and may have early sucess of some sort scmoozing with vested interest parties but in the long run a man that displays knowledge and passion for what he loves will win out.
Ten years from now I would like to be looked up too and not looked down upon , (how about you )?
When you are underpriced you know it in your heart that your sub-conscious will prevent you from doing the best you can for your client as you"ll feel under paid as you work.This will show in every step of your dealing in the business.
Sorry if this is heavy talk, but it is what it is.

[jmichalski]

Robert,
Maybe my area is different from yours, but agents don't price shop here. All price shopping calls are clients. Agents just call to book.

The reason people ask for prices is that they care about getting value.

Also, if you set prices to compete at the high end of the market and cannot offer honest answers (it sounds like you are a man of integrity, so I know you would't lie or hide the truth) to "how long have you been in business, "how many inspections have you done," or "what do you do that is better than your competitors" then people will know you are a newbie.

It is fine for you to pursue the high brow clientele - you are established in the business.

But to tell a rookie to chase those same clients at that end of the price spectrum does not make business sense. There are more price shoppers than there are boutique shoppers by about 10:1 (I equate them to good consumers, not bottom feeders, but I guess you buy the most expensive gas and don't clip coupons). If I am trying to get my foot in the industry door, I am going to try to claim my piece of teh largest number of clients I can.

Each client is a potential referral (acutally 4 potential referrals: buyer, seller, 2 agents) . So, the more inspections I do, the more future business I can potentially generate (another reason not to ever say anything as silly as "I won't start my truck for less than $XXX"). And so on, and so on.

The change in pricing strategy saved my business at the start, and helped me become a multi-inspector firm within 3 years.

EVeryone has something that works for them. For most newbies, agressive pricing will work (of course you need to know your market and your costs, too).

And I have never been on any job where I hav done any less than my absolute best for the client - regardless of price, size of home, or amount in the client;s checking account. So that crap about "knowing in your heart" and "subconsciously" underperforming is a load of BS!

[Nick Gromicko]

Bottom dwellers probably harm their clients, very probably harm their own businesses, and damn sure harm our industry... IMHO.

[relliott]

Jm I had a suspicion but was not sure that you were a multi -inspector firm.
This is far different from being a single inspector as sole proprietor.
McDonalds sells cheap hamburgers because of volume in the same way you can sell cheap inspections thru volume.
Sorry if the term cheap feels ..well cheap but it is what it is.
I myself am a newer inspector and have never on this forum tried to hide that fact.
Has it cost me any business ?
Not other than my first few calls , which occured due to the fact I was dumb enough to answer the question how much without realizing that is not the proper procedure.
I have made great point to mention that untill six month's ago I could not type , though some may argue that still holds true.
Now back to subject if you are going to get into this business and make a go of it you had better begin having confidence and telling someone to come in and work for peanuts as he drags the prices for thr market down is not my way of helping the profession.
Look if you have other guys working for you and the fees are on the low end then they must be making lower than low which is quite low.
I would guess you are grabbing these guys while the snot is still wet and dripping down their noses.
Not trying to insult you personaly but feel that by spreading your methods to others it will bring down the entire trade.
I can only guess that your inspectors stay for a short time and then wise up.
I also have got to wonder how a guy in a town so small can find that much business unless sleeping with the agents.
Sorry again but I speak my mind.For you to get enough business in a small market area and have enough left over that you can hire others for low wages you must have an inside position that would only come through nudge ,nudge ,wink,wink.
You seem like a nice guy when I have read your threads but the philosophy of turning us into being regarded as unskilled labor to be hired out cheap is something I'm against.I have put to much effort into training myself in being the best inspector I can be and intend on doing this the rest of my life.
I will not sit still while someone cheapens what I love.

[bzimbelman]

Joe,

I'm surprised at you, your mantra has changed. I thought you preached business plan first, no?

Step one should be to write a business plan. Now, you may or may not know what one is, but it's basically a road map to success. You will need to do serious business research, competition, market size, etc. Then armed with that information and what you know about your own product, you can put together a strategy for how you are going to make it in this business.

That may very well be to take Joe's advice and price yourself down near the bottom of the reasonable HIs in your market, or it may not, depending on how your market acts.

Joe states that in his market he gets alot of price shoppers, I don't get many in mine, never have. I did start at a lower price point to get a percentage of market share before I raised my rates, but I did that as a dedicated, short term strategy. I also thought the plan out a few steps ahead of where I was, and I set my prices high (hun?), then offered short term discount cards. Each one was given to specific realtors with expiration dates.

I was surprised how well it worked, I got volume, and got my report in front of a lot of realtors, which got me a fair number of followup referrals, which I was able to charge full price for (remember my higher prices).

Now, will what worked for me work for you? Maybe, maybe not. Most certainly will probably need to be tweaked for your market which brings us right back to writing a business plan.

Isn't that right Joe?

[Nick Gromicko]

Joe M. is quick to point out how he thinks undercutting has a positive effect on his own business in that it leads to more inspections, but fails to point out the negative effect that it has on all of us by reinforcing the public's and REALTOR's current thinking about what our fee structure should be.

Joe M. advises a guy who isn't making money by buying watermellons in the South for a dollar a piece, driving them up North in his pickup truck, and selling them for a dollar that he needs a bigger truck.

[relliott]

Good point Nick

[jmichalski]

Actually, my inspectors are retired union trade pros with over 30 years in their business, each. They work because they want to be active and involved, and I would trust their opinion over any inspector I have ever met, any day of the week.

I know that if I have a special electrical concern, I can go to my retired union sparky over 40 years. Or if I have a structural issue, my master carpenter of over 30 years probably has a good read on it.

So, save your sanctimonious crap about me taking advantage of some high school kids.

Like I said - you go take that hig brow clientele. I will battle you for them at the top end of the spectrum with my PREMIUM and PROFESSIONAL level inspections, and educate my consumers to the importance of asking about experience, previous background and some pointed, leading questions (as well as the right answers). No newbie will get that job.

You can call price shoppers "bottom feeders" and discuss how I "cheapen" inspections all you like but they represent more of the market share in raw numbers and total doallars spent. As a newbie, you would be foolish to ignore the economics of that, but so as you like.

If you are worried that my accurate advice to others on setting aggressive prices is going to impact your price, then you aren't really sold on your own position.

[Nick Gromicko]

I spent countless sleepless nights developing tools for inspectors to use to raise prices. It's become my life's work. We should be all charging triple.

There is no reason to go into this business to make a good living... inspectors should be making a GREAT living.

Anyway, after years of work in this area, I've only found 2 ways to raise prices:

The first requires that you do 100 different things, so it is a bit complicated, but nevertheless it works. That is, to market yourself so perfectly that you get swamped with work, so much so that you have to turn down work. Once you get to that point, you can raise prices. Then use some of the additional profit created by the price increase to market even more (even though you are already too busy). The idea isn't to do more work, the idea is to get so busy that you turn down more work... or raise prices. Guess which one you do.

The second is a miracle tool: CMI.