How to talk to your customers about budgets

Every customer is different and so finding the best way to tactfully discover how much they have to spend on a project is an art form in its own right. Chris Frankland asks our kbbreview100 retailers how they go about it

There is an infinite variety of product in the KBB world. You need to coax every detail from your customers about their aspirations in order to guide them through the best options. But, before any of that, the elephant in the room is, of course, budget.

Many retailers would say it is crucial to gain a good ball-park indication of how much a customer wishes to spend before wasting hours crafting a design that turns out to be way above, or even below, their available budget.

But what is the best way to approach the subject? Customers may fear they will end up spending more than they need and so may be coy about what they are prepared to spend.

Simon Taylor, MD of Simon Taylor Furniture in Aylesbury, advises the direct approach. “Never treat the subject of the client’s budget like it’s an elephant in the room,” he says. “It will save everyone’s time if the client provides an indication from the outset. If you start working on plans without discussing a budget in advance, you may end up doing a lot of work for potentially little return.”

Victoria Anderson, showroom category manager at Elliotts Living Spaces in Lymington, is in no doubt it is best to get budgets out of the way early. She says: “We try to gauge the customer’s budget in the first meeting. This helps both of us understand which products they should be looking at. We have set up our product selection in a way that we can offer a ‘good, better and best’ and having the customer’s budget helps us steer them in the right direction. If we don’t get a rough idea of budget, we risk wasting time on a design that is out of reach for the customer.”

Expectations

The danger of wasting a designer’s time is also much on director Johnny Bacigalupo’s mind at Napier Bathrooms in Edinburgh. He says: “It’s vital that boutique, design-led showrooms discover what intended budget a client has before fully engaging with the design project. People are often reluctant to discuss their budget, but this can be removed with careful conversation about the expectations we know our clients have of us, and the need for us to know if the cost of our products and services are acceptable to them.”

Elizabeth Pantling-Jones, MD of Lima Kitchens in Milton Keynes, adds that you can’t deliver your best service without knowing the budget and that “many clients’ expectations can change on budgets, adjusting either how they finance the project or their timescales”. 

Sometimes it may require a delicate touch, as Andrew Warnes, man–aging director of COD in Altrincham, suggests: “Clients are often reluctant to share this information. We tend to tease bits of information from them. I drop in a couple of figures that a display might cost and watch the reaction.”

But some believe it is not the most important thing to discuss when you first sit down with a client. Joanna Geddes, senior designer at Kitchens by JS Geddes in Kilmarnock, says: “I don’t think it is the first thing that should be discussed. If the fixation is on budget, the client does not feel that all their other desires are
being appreciated.”

Andy Gilmore, showroom manager at Fineline Interiors in Warrington, agrees: “It’s definitely important, but not the most important factor. We make the initial sit-down about creating desire, understanding needs and wants and pitching an estimate to the customer to see if we are in the right ball park. We say, ‘A kitchen, is very bespoke to you, so you drive the cost rather than us. We just need to know what direction to point you in’.”

Working through a questionnaire can help. Darren Taylor, MD at Searle and Taylor in Winchester, advises: “We have a ‘client brief’, which is a fairly intensive document that we work through with the client, as this asks all the questions we need to know to enable us to design a kitchen. If this is filled out properly, we can give a fairly accurate estimate of what they could be spending.”

Gaining trust and being open and honest is also key during these delicate negotiations. Owen Williams, owner of Owen Williams Kitchens in Coalville, says: “Transparency and honesty are key. We have enough experience to be able to give customers a reasonably accurate ball-park figure before we do any design work. We explain what factors influence the price. Many people underestimate just how much appliances and worktops affect budget.” 

Nick McNally, owner of Kitchens by Nick McNally in Edinburgh, agrees: “Most clients appreciate honesty and it is part of building mutual trust. If the partnership is not the right fit, it is best establishing this early on.”

And for some, transparency means full disclosure, despite the risks that brings. Kristjan Lilley, a director at H Lilley & Co in London, highlights the show-rooming issue, but still believes in being upfront when quoting: “There are those that will hide product codes to prevent the client searching online for a better price. However, I am strongly of the opinion that if someone wants to search online to get something cheaper, they always will.” 

Dave Jarvis, MD at Albion Bathrooms, Kitchens, Electricals in Burton-on-Trent, however, takes the opposite view and says he never gives customers individual prices.

But customers always want to feel that they are getting a quality product and good service. A point made by Warnes at COD, who adds: “The client needs to be aware of prices, but also to understand why things are priced so. It is more important that the customer feels they are getting a quality product with a service to match at a fair price, making them feel they are getting value for money.”

Barriers

And mention of value for money also highlights that old bugbear of independent studios being perceived as more expensive.

“You  have to ask the questions that get to the nub of what the customer’s needs, wants, dreams and desires are,” says Ivan Simpson, MD of Ivan Simpson Kitchens and Bathrooms in Durham. “This builds a rapport and determines how to proceed. This sort of conversation makes people feel more comfortable and the budget barriers disappear.” 

The problem is that customers don’t tend to buy a kitchen or bathroom as often as they would, say, a car. As Trevor Scott, chief executive at RFK in
Rugby, puts it: “It constantly surprises us how many people are completely clueless as to how much any kitchen, let alone a mid- to mid-upper level kitchen, is likely to cost.” 

Jarvis at Albion BKE says one client told him “my last bathroom cost £800”. He points out that they may only buy a kitchen or bathroom two or three times in their life and, therefore, don’t fully understand the costs.

And Williams at Owen Williams adds: “We can get blazé talking about figures like £20k to £30k as if it’s peanuts – but these are huge sums of money and it is important to recognise that.”

The secret, of course, is to sell them on the service you offer – it is what sets independent studios apart. As Martina Landhed, design director at InStil Design in Oxfordshire, confirms: “It is important to explain that to the clients at a very early stage. Tell them that if they are looking for best design, advice and service, we are the right place to buy from, but not if they are shopping around for price.”

Jarvis at Albion BKE agrees that selling quality of service is a better place to kick off. “Selling the services your company offers if probably the most important thing to do before discussing any form of budget with a customer,” he explains. “It sets the scene as to why your services cost more than they would pay if ordering the goods from the internet or a shed.”

Bacigalupo at Napier Bathrooms says people understand what a small business offers: “Everyone knows that service should be better from a small business. Small business is built on expertise, knowledge and passion. As the ‘middle’ market disappears, the premium local showroom and online traders grow further and further apart. Local small business is there for service-conscious clientele.”

Ed Scott, a director at Hutton Kitchens in Essex, agrees: “Once the budget barrier is discussed, clients can understand what they get for their money and how much better value and long-term service they can achieve from an established independent.”

When talking budgets, McNally at Kitchens By McNally gives a straightforward formula and suggests spending between 3% and 8% of property value on a new kitchen. Rufus Wainwright, a designer at Ulmo Kitchens in Poulton le Fylde, usually suggests £15k to £20k for a £200,000 property and £40k to £100k for a £2 million home.

Having said that, there is, of course, always some wiggle room in any negotiation. John Pelosi, owner of Caldicot Kitchens and Bathrooms, distils it down to this one piece of advice: “Explain that you can’t give them champagne on a lemonade budget, but you might be able to treat them to an excellent Prosecco that will taste every bit as fine.”

So where does that leave us? 

Most retailers agree that getting a good ball-park figure on the table at the earliest possible stage will help avoid wasting everybody’s time on a project that does not suit the client or the retailer. 

The secret is being honest, direct and open about the quality of service your clients can expect from your business, and that there are ways to reduce a quote if required, which should help convince them to buy from you.

Retailer top tips

  • “Bring it up early. Don’t wait for them to bring it up” says Phil Beechinor, MD, Alexander
  • Sell your company and the service you provide first, then talk budget suggests Dave Jarvis, MD, Albion BKE
  • Build a relationship and trust with the customer quickly says Victoria Anderson, showroom category manager, Elliotts Living Spaces
  • Simon Taylor, MD, Simon Taylor Furniture says Never ask a leading question a client can say no to. Take time to build up a rapport and make them feel comfortable talking about budget
  • Trevor Scott, CEO, RFK uses car brands as a guide and asks do they want a Kia or a Range Rover? 
  • Tell them how much some of your showroom displays would cost and watch for the reaction explains Andrew Warnes, MD, COD
  • Share examples of the cost of your previous projects Martina Landhed, design director, InStil Design
  • If you can’t get the info, do two quotes – one that pushes it to the maximum and one using cheaper products suggests Kristjan Lilley, director, H Lilley & Co
  • Darren Taylor, MD, Searle and Taylor makes sure the client can not only afford a kitchen, but is actually willing to spend the money
  • Treat customers as you would wish to be treated – be open and honesty says John Pelosi, owner, Caldicot Kitchens and Bathrooms

Have something to say? Email the editor