By Jim Augustus Armstrong
(First of two parts)
“The most we can charge is 35% margins because people in our area won’t pay more.”
I was conducting a coaching session with a flooring dealer who wanted to grow his business, and he was trying to convince me that there was no way he could raise his prices. I, of course, was having none of it. “I’ll make a deal with you, Bill. I’ll meet with you in one month and give you a free coaching call, but you have to accept this challenge: on your next 10 quotes, I want you to charge 45% margins and see what happens.”
When I met with him the next month, he had permanently increased his margins to 45%. Why? Because instead of his close sale ratio dropping (as he feared) it had remained rock solid. For years, he had been leaving thousands of dollars in additional net profits on the table for absolutely no reason. The wrong mindset had cost him a fortune.
I call this the “10-Quote Challenge.” Every dealer I’ve worked with who has accepted the 10-Quote Challenge—and I mean every single dealer without exception—has wound up permanently raising their prices. I created this challenge as a way to quickly recalibrate a struggling dealer’s self-limiting mindset.
I’ve worked with countless dealers who have been stuck at a certain revenue level for years. Phrases like, “Yeah, we’ve been at about $1.5 million for six years” are something I hear all the time. What’s holding them at that level? Who put that glass ceiling over the dealer’s head? The dealer did—most likely without even realizing it.
Tony Robbins teaches the concept of the internal thermostat. We all have a thermostat inside of us that regulates how successful we’ll be. Let’s say your thermostat is set at $1.5 million a year in revenue. If you drop down to $1.2 million, your thermostat will kick on and “warm” you back up to $1.5 million. If you increase to $1.8 million it will kick on and “cool” you back off to $1.5 million. If you don’t reset the thermostat, you’ll likely always be stuck at the same level. This principle applies to losing weight, having healthy, fulfilling relationships, getting in shape, etc. Through sheer will power an overweight person may succeed in dropping that extra 50 pounds, but if they don’t recalibrate their internal thermostat to that lower weight, there’s a good chance they’ll regain it.
If you’ve tried unsuccessfully for years to make positive changes in your business and nothing has gotten better, or you’ve only experienced minimal improvements, there’s a good chance that your internal thermostat needs to be reset. To reset it requires purposeful, mindful action. Why? Because your mindset—your thermostat—is controlled by thoughts and ideas that you learned years ago and that run silently in the background, shaping your results without you even being consciously aware of it.
If you’ve tried to make improvements and failed repeatedly, you’re likely neglecting the internal mindset work necessary to make those improvements a permanent reality. In part two, I’ll give some concrete exercises you can do to reset your thermostat and experience the success that’s eluding you.