Need some wisdom

[tintme69]

I've been tinting at an accessory shop, renting space there for X % commission. Last year he asked for 5% more, now less then a year later, he's demanding another 5%! Well, that's a whole other story; what I'm needing help with is to decide whether to go up on tint prices to make up the difference, or to go down a little, hoping to make up the difference in volume, but also retuning the shop owner's per car profit, back to what it was. Opinions?

[coast2coasttinting]

I would go looking for my own shop.

[tintme69]

I'm one step ahead of ya, but that may be a few months out. There aren't many shops in the good area with a bay.

[TintWizard]

I would go looking for my own shop.

The only problem with this advice(which is advice I also use to give right away) is that it's the best move for some , but a death sentence for others . It really depends on the individual and all the skills they have to run every aspect of a business. I would say know yourself well enough before doing that. Are you good at sales, book keeping, afford the ups and downs of fluctuating months..many things I think employees, commission workers don't think of before it's too late . Know yourself. If your cut out for it , jump ship and fly on your own, if your comfortable with how things are and have been other than the financial, I would suggest adjusting the commission or overall price structure. I would not suggest keeping it the same and rewarding yourself by increasing volume and working harder but not smarter. The best to you in your decision.

[Counterpart]

hi tintme69,

First of all, I think you have a very sound business model; if you only, pay the shop owner a commission for any car that you tint.

Next, let the shop owner knows that any tinting price hike will reduce customers = reduce his commission in another way. I hope this reasoning will limit the increment that he is asking for.

my 2 cents

[coast2coasttinting]

you might also talk with him about a flat rate instead of commison. He will get paid the same every month. And it will push you to get more work done. Try taking an average of how much you do a month in tint and see if he will work with that.

[nctinter]

10% increase is absurd. I would raise my prices and get out of there as soon as possible

[Counterpart]

I'm one step ahead of ya, but that may be a few months out. There aren't many shops in the good area with a bay.

I envy your existing business model. Your fixed costs are negligible.

[Tintguy1980]

I've been tinting at an accessory shop, renting space there for X % commission. Last year he asked for 5% more, now less then a year later, he's demanding another 5%! Well, that's a whole other story; what I'm needing help with is to decide whether to go up on tint prices to make up the difference, or to go down a little, hoping to make up the difference in volume, but also retuning the shop owner's per car profit, back to what it was. Opinions?

Could it be the accessory shop owner is feeling the same economic pinch as many others and his easiest means of maintaining his (status quo) profit margin is someone who sublets from him? It truly seems counterintuitive, in hard times businesses tend to increase cost of goods sold, but that is the reality; they do not want to sacrifice (like the Greeks and their austerity measures).

Lowering price would increase volume indeed but to profit from volume is like eating soup with a fork; you stay busy while going hungry.

Raising prices inevitably slows volume in the short-term, but it does recover somewhat in the long-term. Meanwhile profit remains somewhat stable until the return of lost volume, then profit increases and all the while one does not work as hard.

[tintme69]

Thank you, everyone, for all your good advice. We met with the owner and agreed to give him the increased percentage, but asked only that he sign an agreement to not go up for another three years and to include me in his existing advertising, like was promised the past two price increases. He would not put anything in writing, but has changed his advertising. Basically, I went up on my prices and am in negotiations to move to a new location in a few months. It really sucks though. I like where I'm at and the other people I work around. Greed sucks!