No matter where you live, whether it’s a small town or a major center in Canada, the US or abroad, you’re going to hear about home stagers with cheaper rates than you.
Often you’ll hear the most “price complaints” from real estate agents who are already afraid their clients will want them to pay for your services. Since they make the same commission regardless of what their marketing expenses are on a property, their goal is to spend as little as possible to ensure the widest profit margin.
Don’t be discouraged if others tell you there are cheaper stagers then you. This doesn’t mean you are too expensive and it may very well mean, “they” are too cheap and won’t last long in their staging business.
Home stagers, have you run into pricing pressure from real estate agents? How did you handle it? Please add your comments below, this will be a great discussion as we can all learn from different points of view.
In an upcoming series of posts I’ll be exploring how to deal with pricing pressures and (even better) how to avoid them even if you’re more expensive than your competitors. Don’t forget to add your thoughts!
Debra Gould, The Staging Diva®
President, Six Elements Inc. Home Staging
Debra Gould knows how to make money as a home stager and she developed the Staging Diva Home Staging Training Program to teach others how to earn a living doing something they love. There are over 4000 Staging Diva students around the world.
We run into this issue quite often. Recently a home stager emailed me and told me to “watch out” because they were going to undercut us and steal all our business. I simply responded by saying that she was only doing herself a disservice – because by setting a precedent like that she was telling other new stagers that it was okay to charge less and less for what we do. Eventually I told her, she would be working for FREE just to remain “competitive”.
I’m not worried. The realtors we work with know the quality of our work and while we’re not the most expensive stagers around, neither are we the cheapest. We are raising our rates for the 2010 season as business is great and we are going to have to hire a part time stager next year.
With so much media attention on home staging and all kinds of new stagers popping up on a month to month basis, its no wonder these things are happening. Regardless of the type of business, it generally takes a few years before the business starts running a real profit so undercutting your prices at the beginning when its most critical is one of the best ways to ensure that your business won’t be around long.
Heather, thanks for those great observations.
Love that you were warned to “watch out” by the new cheap stager in town. Interesting marketing strategy she’s got on many levels! LOL
Congrats too on all your success. You and your partner do great work and you’ve paid the right attention to building and maintaining a professional image in the marketplace. This will always serve you well!
Debra
Like Heather, I have also noticed more pricing pressures lately from the ‘discount’ stagers.
Recently a real estate agent (who’d never used a stager before) invited Bloom to bid on a vacant condo job. As it turns out, he invited 7 companies to bid and he ended up picking the cheapest – which wasn’t my quote. Once I knew how many competitors were involved, I knew I wouldn’t be the lowest bid, but stuck to my pricing model and vision for this high end unit.
It can certainly be challenging when you know the competition is so stiff, but building a quality business reputation is the key to long term success.
I ask upfront in a situation like this how many stagers they are getting estimates from and explain that I am likely to be one of the most expensive quotes.
I explain that I don’t compete on price, that my clients hire me because they value my expertise and understand that as with most things in life, you get what you pay for.
I thank them for their interest in my company and explain that clients who are only looking for the work to be done as cheaply as possible really aren’t a good fit for me. I say I am too booked up with the right clients to change that approach and then I decline to participate.
Arrogant perhaps, but a huge time saver that allows me to spend my time on the people who value and are prepared to pay for what I can do. Interestingly, I have agents that save me for their more important clients and then use the cheap guys for the listings they don’t care so much about!
I think pricing is hands down the hardest component of owning a home staging business. I played around with consultation fees, etc. in the beginning, talked to agents about what the market would bare, and eventually came up with a fee structure that works for me. I still get calls from prospective clients who initially balk at my fees, but after explaining what they get for their money, they usually end up hiring me. There was only one other stager in my area, and she offered free consultations. I haven’t heard her name or seen her work anywhere, so I think she’s out of business already. I WILL NOT work for free and I do not want to be known as the “WalMart” stager. I let my work speak for itself, and my best advertising is referrals from clients. I’m making a profit for the work I do. Aren’t we in business to make money doing what we love to do?
Staging To Sell
231.690.0398
Jill R. Monczunski
President/Designer
jill@designedbystagingtosell.com
Michigan USA
Yes, I too have run into the pricing war! Just recently I was asked to quote on a nice vacant home that they wanted staged. I went through the empty home and made notes about what I thought would accent it’s best features and so on. When I contacted the agent to give her my quote, she informed me that I would be bidding aganist 3 other stagers. So, I knew that she would be picking it on price!
I gave her my quote (which she didn’t even look at) and said my price was too high. She then showed me a stager on her computer that advertised home staging services starting at $100!!! I almost laughed at her! What do you get for $100 in a vacant house?!!! NOT much!
It IS frustrating when they are looking at price alone – and the houses DO sell! I have started offering a range for them to choose from. How have others handled this? Do you only offer your full staging and stick to your price? Do you offer any other services that are less costly? I find that with my fee, delivery cost of rented furniture and my cost for accessories, there isn’t much room to play with when you start adding furniture.
I definitely prefer working on occupied homes. I can go in, give them my consultation and go from there. Some will use more of my services, some are ready to do it themselves!
It’s a crazy business but I love what I do!
In my opinion real estate agents shouldn’t feel I’m going to low-ball a staging job at the drop of a hat. I don’t tell agents what they should be charging for their commissions, so I guess I expect the same treatment from them. If by chance a realtor offers to pay for my services in their client’s home (and this rarely happens) then I can see why they may want to negotiate with me. If that were to happen, I would gladly hear them out and suggest entering into some sort of deal. Like for example, “I’ll discount my rate on this job, but I would be looking to be brought in for consults on two more of your listings this season.” If that realtor is willing to “give” as well as “get” then I know he\she conducts business fairly. As a practice, I choose to extend an occasional rate discount only to the realtors that I have a long standing relationship with. These are progressive talented agents who have been good to me and my business, and we respect one another as professionals. If I’m getting a number of jobs from a realtor over time, and we mutually respect each other, then offering a discount now and then helps to foster a successful partnership between us.
Leah, I agree with you but here’s a modification I would suggest for those special circumstances where you might be tempted to negotiate:
You said “I’ll discount my rate on this job, but I would be looking to be brought in for consults on two more of your listings this season.”
Since you never know about those future jobs (just as they have no idea how many listings they’ll get), I’d switch it around to say, “To reward you for continuing to use my staging services, I’ll discount my rate on the third listing I stage for you this season.”
I agree with Debra, you can’t pay your bills on promises of future business. If you discount it should come down the line when they have proved their loyalty to you. (I got burned a few times on that one when I first started)
Thanks for sharing your experience Chris, I know it will help others avoid the same pitfall.
fantastic advice!!
After reading these comments, does anyone else ask a seller or an agent if there is a budget? In my initial phone conversation when the potential client or agent calls me, I always get around to budget issues. If they really expect everything for nothing, I back it down and usually won’t take the job. I would rather NOT have a chintzy staging hanging over my head. My business is growing on referrals, and if I don’t feel I can do my clients justice, I just don’t do it at all. It’s difficult to bite that bullet, because I WANT to work. Keeping that in mind, I did do a staging for only $300 once, but the home needed very, very little (no painting, etc.) So, whether I’m speaking with an agent or a homeowner, it’s not a bad idea to ask for a budget range up front so you don’t end up dealing with clients who are disappointed … and, worse case scenario, angry! … with your quote. Keep in mind, we live in a society that likes to get everything for next to nothing! For sellers who oh so often have the mentality that “we’re selling and don’t want to put any money in this house”, remind them that staging is an INVESTMENT, and their staging investment will more often than not cost a whole lot less than their FIRST price reduction!
Staging To Sell
231.690.0398
Jill R. Monczunski
President/Designer
jill@designedbystagingtosell.com
Michigan USA
Oh, this is quite the topic in my area. I recently attended my first formal networking event and met a new stager to the area. She offered a $50 special to stage one room! She was very nice and I did share with her that i felt she was too low priced and people might associate that with a bottom barrel product. Agents have always tried to low ball me and I did a lot for free in the beginning. I am not at that point now, because I have great success stories. I also do not depend on my staging income to survive as this is a secondary career for me. However, it must be worth my time to be away from my 4 kids and husband. That is what I keep in mind when pricing. Why put myself out and get nothing out of it….it is very simple to me!
Such an interesting subject! I am a new stager and I have mostly staged vacant homes up to this point. I have been blessed to work with an investor who constantly buys and sells homes and he has kept me fairly consistent with work over the past year. I have gotten a few occupied staging consults as well and I can tell you one thing for sure…I will not ever again waste hours and hours laboring over any staging plan/accesssory package without first knowing that my client wants to hire me for staging! The whole process has been quite a learning process with many mistakes along the way. I am self taught (since I am one of the many who got ripped off by a bad staging school-definitely not yours Debra-I would love to have taken yours instead) so here is what I have learned by trial and error so far…1. Collect pymt for the consult BEFORE you go. 2. Do a walk thru of the home and determine in your mind what you will charge to stage the home using only their items then present a bid. 3. Determine AFTER they hire you how much the home seller intends to invest in an accessory package and work off of that budget. At this point you discuss shopping fees as well. With this method you do not waste any time on a client until you know that you are hired nor do you waste time with all the great ideas of what accessory would look nice where. That can be a huge waste of time! And in this biz time is money! Thanks Debra for all your advice-you are awesome.
Thanks Rhonda for your feedback and sharing your story. Congrats on all your early success as a home stager!
Rhonda, how do you decide your bid for the vacant homes you do?
Holy cow! I know what these stagers are experiencing as I started my staging business 4 months ago, and have been approached by at least 10 realtors and did not get one job. Number 1 wanted 1500 sq ft staged for 350. for 3 months, number 2 wanted me to bid over the phone for a house that was listed for 1.2 mil, (I found out later) but would not pay for a 200.00 consult fee. Number 3 wanted a 2000 sq ft home 3 beds staged for 1000.00 that was including my consult fee. I don’t know what people are expecting, I cant even purchase items at the good will, (as if I would!) for those prices. I am left wondering who is taking these jobs?!
RoyLynn, thanks so much for taking the time to comment and sharing those experiences. Much appreciated.
As for who is taking those jobs… potentially no one. Or, they’re getting only a couple of silly vignettes rather than real staging for those prices. There are also too many stagers who fell into the trap of buying a ton of their own inventory and they’ll take money losing jobs in the hopes of paying at least for their storage locker. Depressing I know!
For these reasons and many more, the business model I teach in the Staging Diva Home Staging Business Training Program does not require you to own your own inventory and I teach you how to build a business with home sellers rather than chasing real estate agents. Much more profitable and more satisfying. Thanks again for commenting!
Dear Debra,
I am a goat milk soap maker in Michigan, and am considering making gift basket with my soap and lotion products, for realtors to use a closing/housewarming gifts. Before I do all of this, though, I have to order bags, rigidizers for the bags, excelsior, ribbons, etc., on top of the wrapped products that I already make. Do realtors really give gifts? What would they be willing to spend? Needing advice before I buy the supplies, which often come in packs of 100, minimum. Thank you.
Jayne, great questions. Perhaps you could contact a number of agents and do your own research. Their answer to how much they are willing to spend, and whether they’d go with the idea, is going to be very dependent on how it’s presented to them however.
If you want one-on-one business coaching, you’ll have to purchase time with me. I suspect there are a number of ways we can increase your business (sales and profits) beyond this immediate idea.
Hi Dabra :
It is me Azi, I have question I’m certified home staging but as you explain don’t do your marketing with real estate agent! How I can get client? Could you say some idea. I really appreciate your time and help.
Thanks for asking Azi. I’ve written hundreds of free marketing related articles in Home Staging Business Report. You can find them all at this link: https://stagingdiva.com/homestagingbusiness/category/home-staging-marketing-staging-photos/
If you really want my behind the scenes secrets that I share with my inner circle of Staging Diva students, you can see the various products I offer in the Staging Diva Store at:
https://stagingdiva.com/store
I’m sorry that whatever training you took to be “certified” in home staging didn’t actually teach you how to market yourself to all 4 key target audiences.
I’m a graduate of Staging Diva Business Program. My business website doesn’t launch until September 2016. Another words I’m open to the public. However I’ve already been pursuing clients to ramp up my portfolio. My angle with real estate agents is different. I dictate the relationships. Fortunately I’m business savvy and my communication skills are strong. I explain what I do and how I charge. So I avoid the whole scenario of offering a cheaper service and going on their terms. I tell the real estate agents to offer my service as an outside consultant who specializes in home staging and it’s completely separate from the agent services. He or she explains the value of home staging to the client, recommends my service to them. Then it’s up to the client to take action. By the way the real estate agent has my portfolio package. Pictures and the way you describe your services speaks volumes.
Excellent plan Jacob, thanks for sharing and I’m really excited for your new home staging business!
I live in Rockingham Perth Western Australia and am just getting my staging business off the ground.
I love reading your posts and tips Debra you are amazing and very similar background to myself. I’m a country girl raised on huge farm. I have completed 2 Interior Design Diplomas. I have built 2 homes and renovated a few homes and office space. I have approached a few local Real Estate agents and quote my own jobs. I have kept my price fair to get established with a workable portfolio. When Real Estate agents throw the..”Why do you charge so much” scenario at me my response is bit bleak to few but makes sense to most , I say why do you charge 3 times my fee to list a property and hold the homeless when I spend approximately 40 hours to stage a home from walk in to walk out. The physical involvement is similar to that of moving house without the clothing and intricate personals and I make the Real Estate agents job of selling become a breeze so why wouldn’t you want to promote me to your potential clients and I will take the pressure away from the hard sell all I ask is for the Agents to promote and support me in informing potential clients this is by far the most beautiful way to move their property on fast and effectively.. Thank-you Debra I love reading your stories..
Spelling error..homeless ..meant to read as home open*
Hi Carol, Thanks for commenting and I’m glad you’ve been enjoying and learning from my posts.
One of the “secrets” I teach about in detail in the Staging Diva Home Staging Business Training Program is that the REAL MONEY in home staging is with home sellers and not realtors. They are the one who make the biggest profit from our services so they have more incentive to use us than an agent does.
Pricing vacant jobs is a huge problem that I’m dealing with. Stagers in my area are charging incredibly low prices and getting the jobs over me. I’ve looked online afterwards to check out the listings and the work done by the stager that was hired and I can see why they were so much cheaper. Furniture and accessories look of low quality and It looks cheaply done. I refuse to lower my standards just to be able to compete. I’ve only started my business 4 months ago and I want to be able to give every client that model home look with quality furnishings and accessories. How can one compete with the “Walmart” type stagers who are getting all of the Staging jobs? It’s very frustrating and discouraging at times!
Rachel Morris, creative director with Amazing Spaces Home Staging http://amazingspaceshomestaging.com/
Thanks for commenting Rachel. The key to remember is you DON’T want to compete with the low cost stagers, they are all chasing each other to bankruptcy. I’ve been a home stager since 2002 and I’ve seen hundreds of them cycle in and out of the industry because they’re not running their business in a sustainable way. They will continue to undercut each other on price until at some point they just burn out because they’re not making any money and they’re working lots of hours.
It kind of reminds me of the age old answer you give to a kid who asks, “Why can’t I? Everyone else is doing it!” Just because these stagers are all diving off the financial “cliff”, you don’t need to follow them.
Take the high road. Cater to clients who understand the value of quality service. It’s all about how you package your business. You want to be seen as THE expert in your area who people hire when they want the job done right. Not everyone shops on price and in fact there is a large group of people who NEVER buy the cheapest thing because they understand you get what you pay for and also because they don’t see themselves that way.
Do you want the type of client who sees themselves as a Walmart shopper, or the one who would go to Nordstrom? Do you want the type of client who takes the family out to McDonalds for dinner or goes to a fine restaurant?
I talk a lot more about the psychology of market positioning and how it relates to home stagers in the Simple Marketing Plan Companion. I’m not sure if you’ve read it but it will help you present your home staging business in the right way to attract the types of clients you want to work with.
You’ll also probably enjoy this related article, When Home Stagers Give It Away.