Higher-ticket products give RSAs the strategic edge they desire

In working with over 100 flooring retailers across the country, I’ve observed many commonalities:

1. There is no low-price leader in our industry.
2. People who sell higher-ticket products tend to stay busier in slow economies.
3. People who have a low average ticket, below $4,000, tend to have a lower closing rate, around 20% to 30%.
4. People with a higher average ticket have a higher closing rate.
5. It’s easier to reach $1M in sales with a higher average ticket.
6. Your marketing becomes easier and less expensive because you don’t need as many customers.
7. There is less competition when you are going after customers who want more expensive products.

Quickest path to $1M in sales

Let’s do some math: With an average ticket of $3,500 we need 285 sales to reach $1M. Closing rate on low ticket sales tends to be lower, roughly 35%. That means you would need 816 leads to reach $1M.

(Stay with me now. I hope this is making sense.)

With an average ticket of $5,500 we need 181 sales. Closing rate tends to be closer to 50%, which means we need 363 leads to reach our revenue goal of $1M.

When you are marketing do you think it would be easier to attract 816 leads or 363 leads? Which do you think would be more expensive?

If you’ve been in the business for any length of time, you know that big discounts or low-square-foot prices just don’t drive traffic into your showroom.

You will attract more homeowners by offering branded flooring and by showing customers how easy it is to buy from your store.

Remember, selling cheap flooring is actually more expensive in the long run. My advice: Don’t walk over gold coins to get to silver ones.

Jerry Levinson is the former owner of Carpets of Arizona. He now focuses full time on training and education. He runs Jerry’s Flooring Business Master Class and is the author of “Profit Now For Flooring Dealer.”