Thread: Discount for repeat after fail sale?

How many of you discount the fee for a second inspection after the buyers walk on the first house?

I have plenty or reasons why we shouldn't have to but people always expect it so it's tough not to.

Reasons not to:

You likely saved them tens of thousands of dollars by pointing out all the problems they didn't see

The place was a dump and likely took you longer than typical to do the job (let's face it people don't walk on 2 year old 4000 sq ft houses very often becuase of what we find)

Of course, there are many more reasons but in reality I just end up doing it sometimes. Typically, if I'm asked and I feel inclined (usually means they were nice people and didn't bring their father-in-law to the first one) I'll give them 10% or so off. I'm just curious how you guys handle it.

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I usually give a 10% discount to previous clients whether it is 10 days or 10 years since the last inspection. It is usually easier to deal with these clients since they now know me and know what to expect. The walk through goes quicker since if they listened the first time, they have already been educated as to the problems, and sometimes have found a better house without the same issues.

I will give a repeat client a small discount on the next home if they walked on the 1st one. Usually they end up thinking about multiple houses for various reasons. I offer them a WTA (walk through assessment). I'll do a WTA on each house, have to schedule all on the same day, back to back. I apply the WTA fee as a credit towards a full HI if the deal is done within 30 days.
Clients like it, I make money and the clients save some money.

I can't recall the last time I was asked to give a discount for multiple inspections. If asked, it would probably depend on my mood at the time, what type of people they were to deal with, etc.

The past company I worked for did give a small discount for repeat customers; I think that it was about 20 dollars off or so.

If I already gave a discount the 1st time around like I've been doing this year, no additional discounts. I have a limit as to how low I will go. Travel and time adds up.

$25 off . We'll go down for repeats to a min of $300 or so. After two walks, they start to get smarter, so the third will be the last in most cases.

I kind of follow what Brandon does. Depends on the house price range, what kind of clients they are, if I know them prior to the inspection, etc. It rarely comes up, and I don't offer it ahead of time. If the house is way more expensive than mine, no discount. They obviously don't need it.

I will, but depends on my mood. Pretty much what others have said.

Pretty much as the others, though I do have a soft spot for young couples looking for their first home and having to buy a second inspection.

Hi Markus,

What all do you do in your walk through inspection and how much do you charge? Do some clients just use your walk through inspection as the final inspection?

Steve R

A walk through inspection? I have been asked to do these but I don't know what it means. I will do an inspection of repairs if I am provided a list and they are willing to pay.

I think if you are ASHI or have any state sandards to follow, any kind of a "walk through assesment" would get you in big trouble.

I have been asked to perform these as well Fritz. Cooincidentally, my schedule is always booked at the time they want me there for the walk-through . I want nothing to do with a walk through inspection. These things which are really just for the buyers are nothing more than them strolling through the house an hour or so before settlement to see if anything appears different from what they remember about the house and to see if there are holes in walls or ceilings, stains that weren't there before, etc. We have already done our job. Going back in and sprinting through the house without duplicating the same inspection is a setup for problems.

Walk through assessment - WTA
- Prerequisite - I have to have done a regular HI already for them and they walked from the deal for whatever reason. The regular HI requirement is so that the client understands what they actually get with a regular HI report and how that relates to their purchase.
- The service idea came from client requests. I wouldn't have thought it up myself. 1st deal goes bad, now they have a couple of houses they really like but which one to choose. Once the 1st deal dies, clients tend to become a little less starry eyed about the process.
- WTA, 2 or more scheduled same day,125-175 per depending on how many, where, size, type, etc.
- No tools or opening of anything, just my flashlight so I can see. 2 page overview report if the property is a candidate. If the WTA brings out deal breakers, I don't bother with writing anything.
- The idea isn't to circumvent the HI report or SOP. As others have mentioned charging clients full price for multiple inspections doesn't work so well for various reasons.
- The typical scenario, client really likes two or three houses, each has it's pro's and con's; one is bigger, one is closer to the grade school, etc. Client doesn't know which one to buy, doesn't want a repeat of the disappointment of the 1st deal, doesn't want to go through the whole purchase scenario and have me come in and kill the dream again; client is running out of time, client needs professional eyes evaluating the product for them.
- WTA gives the client a quick, affordable way to assess whether each property is a real candidate or another bust.
Real example, 1st deal - standard HI inspection and report, flipper POS, looked really great, internally crap, client walked; Client called had two houses they were really interested in. Running out of time, had to get a house so they could get the kids enrolled in the new school district. Did a WTA on both houses. 1st house newer, lots of ongoing rehab done over the years, some good, some bad, needed work but move-in ready, nice overall house, didn't thrill me but I could see why the client liked it. 2nd house a block and a half away, grandma's house, beautiful, great woodwork, loved it, nothing done in 30 years.
I gave the client a 2 page overview on each property, listing pro's/con's etc. Grandma's house was a much better overall value. In part, based on the WTA client decided to buy the other house. With kids and a husband who isn't handy, buying a house that needed full upgrades wasn't realistic for them. I did a full HI on the purchase, the deal looked solid so they managed to get the kids enrolled on time and everyone was happy. Using the full HI, they planned on budgeting repairs and upgrades annually.
- So far I've done a full HI on every WTA property that has been chosen for purchase.
Hope that helps.

How many of you discount the fee for a second inspection after the buyers walk on the first house?

MF: NEVER.

OK, I was not going here, but must. What the hell is it with you folks who feel you must incorporate the term "discount" into your professional life?

Webster's defines the term as a reduction made from the gross amount or value of something. Why would you wish to reduce the value of your inspection service? WTF are you thinking?!

Wake up, lose the term, benefit your profession, move on with your life, be happy.

Originally Posted by A.D. Miller

OK, I was not going here, but must. What the hell is it with you folks who feel you must incorporate the term "discount" into your professional life?

Webster's defines the term as a reduction made from the gross amount or value of something. Why would you wish to reduce the value of your inspection service? WTF are you thinking?!

I thinking "Referrals" from happy clients, that's what I'm thinking!
My client from yesterday passed on the first condo, building needed repairs. This one was good. I gave her a 25$ discount on this inspection, and she handed me a $20 tip. Oh yeah, then I remembered she'd given me a $20 tip the first time too. Happy Christmas to all.

Originally Posted by John Kogel

I thinking "Referrals" from happy clients, that's what I'm thinking!
My client from yesterday passed on the first condo, building needed repairs. This one was good. I gave her a 25$ discount on this inspection, and she handed me a $20 tip. Oh yeah, then I remembered she'd given me a $20 tip the first time too. Happy Christmas to all.

JK: I would take you to task for this, but I'm in a rare good mood today. It is snowing in my area for Christmas, something that happens about only 5% of the time.

You get your referrals your way and I'll get mine from conducting my business as near flawlessly as is humanly possible. And, did I mention, I have a customer database of >3,000 from which comes most of my business? And that without giving one discount in 12 years. Must be a fluke, huh?

Be with your family, be happy, life is good.

Originally Posted by A.D. Miller

OK, I was not going here, but must. What the hell is it with you folks who feel you must incorporate the term "discount" into your professional life?

Webster's defines the term as a reduction made from the gross amount or value of something. Why would you wish to reduce the value of your inspection service? WTF are you thinking?!

Wake up, lose the term, benefit your profession, move on with your life, be happy.

HA HA HA HA!!! Nothing gets Aaron torqued up better than a good discussion involving discounts.

Originally Posted by Nick Ostrowski

HA HA HA HA!!! Nothing gets Aaron torqued up better than a good discussion involving discounts.

NO: If I had known I was entering a discount profession I would have opened a Dollar Store!

AD, I understand your dislike for discounts. Nonetheless, I find it to be a worthwhile practice. I don't do it often, nor for a large amount. I've given discounts for various reasons, clients asks or because I really want that particular job. I usually have enough work to not worry about quantity. I've given discounts because the subject property was in a particular new condo development or subdivision I haven't been in that I want to see.
It seems to me that the real issue here is amount of compensation, not the discount. I'm not interested in de-valuing what we do but discounting at times has it's purpose. We provide far greater value to our clients than what our fee covers. The current benchmark of +/-$400 for a typical HI is too low. I would be much more comfortable with a +/-$600 benchmark.
Unfortunately, there are too many checkbox guys out there doing crap inspections for far less and RE agents promoting that junk.

Perhaps if A.D. thought of it as a customer loyalty award program or efficiency consideration he'd feel better about it than if using the term "discount". That's a consideration for a minimum of 15 minutes savings on information gathering, phone numbers, cc #s, email addresses (already proven no bounces), etc.; introductions/identifications; explanations; and contract review/questions time saved. On the other hand, one has to have the type of personality and style that farming repeat buisness and customer referrals are a realistic possibility/probability.

Happy Holidays, healthy and prosperous New Year to all.

Originally Posted by H.G. Watson, Sr.

Perhaps if A.D. thought of it as a customer loyalty award program or efficiency consideration he'd feel better about it than if using the term "discount". That's a consideration for a minimum of 15 minutes savings on information gathering, phone numbers, cc #s, email addresses (already proven no bounces), etc.; introductions/identifications; explanations; and contract review/questions time saved. On the other hand, one has to have the type of personality and style that farming repeat buisness and customer referrals are a realistic possibility/probability.

Happy Holidays, healthy and prosperous New Year to all.

HG: Think of it how you may, then call it what it is. If it is a "customer loyalty award program" (whatever the hell that is), then call it that, and not a discount.

Words have meanings and they effect people and their reality accordingly. The term "discount" should never be used in this profession and never will be by the true professionals.

Originally Posted by H.G. Watson, Sr.

Perhaps if A.D. thought of it as a customer loyalty award program or efficiency consideration he'd feel better about it than if using the term "discount". That's a consideration for a minimum of 15 minutes savings on information gathering, phone numbers, cc #s, email addresses (already proven no bounces), etc.; introductions/identifications; explanations; and contract review/questions time saved. On the other hand, one has to have the type of personality and style that farming repeat buisness and customer referrals are a realistic possibility/probability.

Happy Holidays, healthy and prosperous New Year to all.

Originally Posted by A.D. Miller

HG: Think of it how you may, then call it what it is. If it is a "customer loyalty award program" (whatever the hell that is), then call it that, and not a discount.

Words have meanings and they effect people and their reality accordingly. The term "discount" should never be used in this profession and never will be by the true professionals.

I explained what it was - an efficiency consideration. Explained it wasn't something for nothing, gave examples should they apply. The 'customer orientation/education' time if reduced - is a time savings - and for multiple inspections/repeat business in a short window of time - it IS worthy of an adjustment and is NOT discounting, its an offset or consideration for that time savings, efficiency, etc.

Consideration - I shouldn't have to define it for you, A.D.; as it pertains to negotiations, pricing, contracts; its a valid quid pro quo.

Originally Posted by H.G. Watson, Sr.

I explained what it was - an efficiency consideration. Explained it wasn't something for nothing, gave examples should they apply. The 'customer orientation/education' time if reduced - is a time savings - and for multiple inspections/repeat business in a short window of time - it IS worthy of an adjustment and is NOT discounting, its an offset or consideration for that time savings, efficiency, etc.

Consideration - I shouldn't have to define it for you, A.D.; as it pertains to negotiations, pricing, contracts; its a valid quid pro quo.

HG: I doubt seriously that you rose to your snowbird status replete with two separate abodes by readily dishing out out "discounts".

The idea that a discount is an investment that will reap you greater rewards in the future is not sound. Each time one lowers his fee he also lowers the value of his service in the eyes of his client. That in turn lowers the perceived value of the service to all of the prospective referrals one is expecting to gain from this stupid maneuver. Hence one has effectively begun the precipitous slide down the slippery slope of asinine marketing.

This is especially true if one offers discounts on a regular basis. It is merely a very thinly disguised excuse for not charging what your service is worth. It is the lazy man's way of appeasing the entrenched retail-driven discount mentality instead of taking the time and making the effort to explain or demonstrate the value in your services.

Remember:

1. Negotiations over discounts, focuses attention on price—as if that were all that matters. If your only competitive advantage is price, you are in trouble, because price can always be matched.
2. Discounting starts price wars. The company that usually wins is the one with the biggest balance sheet—the one who can afford to hold out the longest.
3. Discounting can affect the customer perception of your service. The less they pay, quite likely the less they will value it.
4. Discounting will affect your profit margins. Consider what would happen if all your competitors met your discounted price—do you think your customer is going to accept any less quality?
5. Discounting may affect the quality of your service. Yet, if you compromise the quality of what you sell, you risk disappointing customers and you may lose repeat business, and lose credibility or gain a bad reputation, or end up spending time fixing complaints. One way or another today's discounts could rob you of future business, and profits.
6. Discounting may lead to 'stockpiling' where customers purchase more than they need while the price is cheap. This will affect demand and potential profits in the future.
7. Habitual discounting can become psychologically disempowering. A reduced price can be a short-sighted 'quick fix' that reduces business growth in the long run. Before you discount, stop and think: Is this the only way to give value?

You're on an island by yourself here Aaron. Discounts get you work in the immediate. Do a good job for your immediate clients and the discount that got you that immediate job turns into future referrals, may one, two, three or more referrals. Lose that immediate job over $20 or so and you lose those potential referrals. Hmmmmmm.......Higher fees and an empty work calendar vs. a lower fee you can accept and a full calendar. Hmmmmmm........

The best way to show buyers you are worth hiring is to inspect a house for them.

How on earth can a lower inspection fee led to stockpiling? We're home inspectors. We don't control when people do and don't buy houses and they don't buy houses or inspections in bulk.

You're on an island by yourself here Aaron.

NO: Yes, I am not ovine by nature.

Discounts get you work in the immediate.

NO: Yes, and this is a good strategy for the short-sighted man.

the discount that got you that immediate job turns into future referrals, may one, two, three or more referrals.

NO: Yes, more prospective clients expecting discounts.

Lose that immediate job over $20 or so and you lose those potential referrals.

NO: Yes, and that is a good thing.

The best way to show buyers you are worth hiring is to inspect a house for them.

NO: Yes, for a full fee.

How on earth can a lower inspection fee led to stockpiling? We're home inspectors. We don't control when people do and don't buy houses and they don't buy houses or inspections in bulk.

NO: That is a general statement designed to show you that the theory applies to all forms of business, and not just services. I am certain that it is lost on you and your discount adherents, like all other rational thought.

when I start getting discounts from the doctor for repeated visits, then I will pass it along .

Originally Posted by mathew stouffer

when I start getting discounts from the doctor for repeated visits, then I will pass it along .

MS: Yes, and my attorneys, dentist, home inspector organizations, insurance companies, licensing agencies, IRS, . . . et al. But hey, they are all professionals, unlike the discount boys on this forum.

Quote:
Lose that immediate job over $20 or so and you lose those potential referrals.
NO: Yes, and that is a good thing.

This is where your entire argument falls to pieces Aaron. You'd rather make nothing at all and not work over $20 and you expect all other HIs to band together with you. That's real rational.

"Sorry honey. I can't pay the car loans this month. Aaron says I shouldn't work if I can't get the fee I want for my inspections. I may not be working now but just wait until every HI is doing this with their fees. The bar is going to get so high we'll be eating off gold plates."

Yep....rational.

This is where your entire argument falls to pieces Aaron. You'd rather make nothing at all and not work over $20

NO: Learn to stand your ground and be your own man. It will make a huge difference.

and you expect all other HIs to band together with you.

NO: Absolutely not. I expect little from most other HIs, and am rarely disappointed.

"Sorry honey. I can't pay the car loans this month.

NO: After 25 years of marital bliss, I have never made such a pusillanimous statement.

If you do not act to raise the bar in your own profession, what good are you?

Originally Posted by A.D. Miller

NO: Absolutely not. I expect little from most other HIs, and am rarely disappointed.


If you do not act to raise the bar in your own profession, what good are you?

I'm confused Aaron. Which of those statements do you mean? If you mean the first, then you are not doing the second and if you mean the second then the first can not be true. I don't see how you could possibly be raising the bar when you insult everyone in your profession.

“Hypocrisy: prejudice with a halo” --- Ambrose Bierse

I'm confused Aaron.

KR: I have no doubt.

Which of those statements do you mean?

KR: Well, I meant them both, of course.

I don't see how you could possibly be raising the bar when you insult everyone in your profession.

KR: It seems that you equate raising the bar with being PC. Typical head-in-the-sand mentality.

“Hypocrisy: prejudice with a halo” --- Ambrose Bierse

KR: It is likely that I had read everything available from Ambrose Bierce (yes, that is Bierce with a "c" and not an "s") 30 years ago, so keep the Devil's Dictionary quotes for someone else like yourself who does not understand his work.

Originally Posted by A.D. Miller

KR: It is likely that I had read everything available from Ambrose Bierce (yes, that is Bierce with a "c" and not an "s") 30 years ago, so keep the Devil's Dictionary quotes for someone else like yourself who does not understand his work.

AD: Sorry, I wasn't born until 1969, I didn't know you had to be 90 years old before you where allowed on this board. You sure you are still able to climb those ladders old man?

KR: It seems that you equate raising the bar with being PC. Typical head-in-the-sand mentality.

AD: I didn't know you would take such offense at a misspelled name or I would have taken, the time to look it up....no I wouldn't cuz I don't care if you are offended by "mispelled" words (misspelled being the most commonly misspelled word in the English language). See, no PC here. Hypocrisy is still Hypocrisy and you still aren't raising the bar of HI's around the world by insulting all of them. I'm sure you will have some sly remark with which to come back and insult me again, as this is your nature and has been on all of your posts. I still respect you as an intelligent and experienced HI and from whom I'm sure I'll learn something. If nothing else, to not grow old and become a cranky disrespectful old man. Put that in your PC Pipe and Smoke it (with all due respect)

AD: Sorry, I wasn't born until 1969

KR: The very year I entered the U.S. Army.

I didn't know you had to be 90 years old before you where allowed on this board.

KR: You don't, unless you are the Big Cheese, like the Flahdah Boys.

You sure you are still able to climb those ladders old man?

KR: Backwards. You won't hold a candle to this old man.

I still respect you as an intelligent and experienced HI and from whom I'm sure I'll learn something.

KR: In that case, quit yanking my chain.

NO: After 25 years of marital bliss, I have never made such a pusillanimous statement.

This is how you say coward when your wife is looking

Don't bother wasting your time Korey.

Originally Posted by David Bell

NO: After 25 years of marital bliss, I have never made such a pusillanimous statement.

This is how you say coward when your wife is looking

DB: Nope, I just say yes ma'm . . .

Originally Posted by Nick Ostrowski

Don't bother wasting your time Korey.

but it's so much fun pulling his chain and watching him react!

and this time of year, Time is one thing of which I have plenty. Although I should be focusing on Training...but this is more fun. Ok Ok, I'll go do some training. I'm sorry I had fun at your expense Aaron. I'll do it again later... uh I mean... I won't do it again.

Happy New Year everyone. Hope you have the opportunity to give many discounts to repeat clients in 2010. By the way, back on topic, I don't "generally" give discounts, I give the 10th inspection free for investors, which is probably 80% of 2009 business (not the free ones, the investors).