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Hey guys, in this video we’re going to talk about how to price your home services—specifically for remodelers—how to price a kitchen remodel or a bathroom remodel, and the key factors to ensure you’re pricing successfully.
One of the biggest mistakes I see is pricing based on the market. Many contractors look at competitors’ bids or customer expectations and price accordingly. The problem is that most contractors price too low. They don’t make enough to grow their business, pay employees well, or invest in marketing. That’s the reality for about 80–90% of the market, and you don’t want to fall into that trap.
When pricing your services, focus on four key things:
1. Pay yourself well.
As the business owner, you’re taking all the risk. If you can’t pay yourself more than you’d make as an employee somewhere else, what’s the point of running your own business? Business ownership requires wearing many hats and often working 60–80 hour weeks. Make sure your pricing allows you to be properly compensated for that risk and effort.
2. Pay your employees well.
Good labor costs money. If you want to hire and retain quality employees, you need to price your services to account for that. Even a 5–15% premium on salaries over the market rate can make a difference. If you price like everyone else, you’ll struggle to find and keep talented staff.
3. Pay for growth.
Your pricing should also cover marketing and business expansion. Relying solely on referrals often brings in small, one-off projects that are inefficient. A consistent marketing system targeting ideal projects—like kitchens, bathrooms, or basements—simplifies operations, strengthens relationships with subcontractors, and positions you as an authority in your market.
4. Make a profit.
After paying yourself, your employees, and funding growth, you must still make a profit. That’s the point of being in business. Without a profit margin, you either stay stagnant, work excessive hours, rack up debt, or risk failure.
Many contractors blame their market for low pricing. For example, I recently spoke with companies in Florida who said people there are “shoppers” and won’t pay high prices. But I also spoke with another Florida company whose average kitchen remodel is $60k with a 40% gross margin. Same market, different approach. The difference is deliberate pricing, marketing, and positioning.
The takeaway: always assume there’s something you can improve. Don’t accept the market as a fixed limitation. Focus on improving your sales process, marketing, and operations. Your mindset determines whether you feel stuck or empowered to grow.
So, when pricing your remodeling services, remember these four key factors:
- Pay yourself well.
- Pay employees well.
- Pay for growth.
- Make a profit.
If you follow this formula, you can scale sustainably and avoid the common pitfalls most contractors face.
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