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Private Duty Today
Welcome to Private Duty Today,
the bi-weekly electronic newsletter for Private Duty Home Care Leaders
from Leading Home Care ...a Tweed Jeffries company.
I'm Jason Tweed, Director of Business Development for
Leading Home Care, and Editor of Private
Duty Today.
Private Duty Today is published every
other Wednesday, and currently goes to over 7000 subscribers.
Private Duty Today is
a permission-based newsletter.
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Are you still selling hours of service? Are you
quoting hourly rates to your customers?
If so, you're making a mistake. None of you want to sell single
hours of service. You want to sell large blocks of time.
Your customers want to buy comfort, companionship, security,
dignity, privacy and, in some cases, friendship. To your
customers the fact that these things can be purchased by the hour is
irrelevant.
Ask yourself this question. How much is an hour of dignity
worth? $20, $18, $23?
The only value in an hourly rate is establishing a basis for
a transaction. You're trying to quantify something for your
customers that can't be quantified easily.
Unfortunately, your only real accomplishment is showing your profit
margin to your customers. They know your caregivers are making a
certain hourly rate, and you're charging perhaps double that. Now
you're giving permission to your customers to ask the question,
"Is my home care company really worth as much as my
caregiver?"
Imagine visiting Target or Wal-Mart and looking at the tag on a pair of
jeans. They are only $23.50, a good value. Now imagine that
just below the price was the original cost. An overseas factory
worker was paid $3.25 per hour, and produced three pair of jeans.
You start to ask yourself if the manufacturer and retailer are really
contributing that much value.
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As a young man, I interned in HR at a department
store chain with a specialty in jewelry. They viewed the
engagement ring as a critical product because it was frequently the
first jewelry purchase many people, particularly men, would make.
Pricing on diamonds is unique compared to other non-jewelry
products. A 1/4 carat diamond is relatively inexpensive.
Upgrade to a 1/2 carat diamond, and the price almost doubles.
Upgrade again to a full carat diamond, and the price can quadruple or
quintuple.
John goes into the department store to pick out a gift for his
girlfriend. The salesperson asks "What is your budget?"
to which John answers "$500-$1000."
The salesperson shows him a $500 diamond and a $1000 diamond. The
goal, of course, is to sell the $1000 diamond. The salesperson
says, "But if she's really special ..." and shows him a $5,000
diamond. Suddenly the value of the $1000 diamond is far better
defined. Now John realizes that when comparing price to size, the
best value comes near the top of his budget.
Creating tiers of service is a great way to demonstrate value to your
clientele.
· For $250 per week we can provide 10 hours of
service, twice a week for five hours.
· For $500 per week we can provide 25 hours of
service, daily coverage including five hours each day Monday through
Friday. Additionally, one of our case managers will call once a
month and make adjustments to your care if necessary.
· For $800 per week we can provide 40 hours of
service, full coverage Monday through Friday. Our case manager
will touch base weekly by telephone, and visit monthly.
Additionally, we're going to provide you a security alert button at no
additional charge so you'll have someone standing by 24/7.
Now you're clearly defining the value of care, and demonstrating that
your top tier of service provides the best value.
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Happy Family vs. McDonald's
My favorite Chinese restaurant in Reading, Pennsylvania
was a locally owned place called Happy Family. It was a small
restaurant where the only person who spoke fluent English was the
delivery driver, so if he doesn't answer I strongly recommend ordering
by number.
Their menu was an 11 x 17 trifold printed in red and black; red items
were "spicy hot". It was the quintessential Chinese
take-out menu with 128 items split into 10 or 12 categories.
I love their food, but there is a problem. My lovely wife has
difficulty being decisive. She'll spend 12 or 15 minutes staring
at the menu. Then she will ask my opinion about at least six
items, and spend another 10 minutes studying the menu.
Frustrated, she will finally order General Tsao chicken, like she does
just about every time.
Me, I will eat anything. I pretty much close my eyes, twirl my
finger, and point blindly to the menu. Pork egg foo young ...
sounds delicious.
Decision-making is difficult with so many choices.
We go about it in different ways, but ultimately neither of us were
able to choose effectively.
McDonald's has discovered the key. Originally McDonald's had
burgers, fries and shakes. As the menu expanded they understood
that they were making it more difficult for people to make
decisions. Ultimately difficult decisions cost McDonald's
money. Difficult decisions create long lines. Long lines
create unhappy customers. Unhappy customers ... well, you get it.
To solve this problem McDonald's created full meal deals. You
appear to have six choices. In reality your choices are even
fewer. If you don't want a burger, you're choosing from chicken
or fish. Feeling healthy today? Have a salad. Chances
are before you ever approach the drive-through board you have narrowed
your choices to two or three items.
People like this process and it's extremely effective both for customers
and for McDonald's. Today over 75% of customers order one of
these meal deal choices, and frequently order by number. They
still have 50+ items available, but the decision-making process has
been streamlined.
Private Duty Home Care needs to be more like McDonald's. You need
to create packages of products and services that demonstrate the scope
of your service without the Chinese menu effect. Create half a
dozen packages, and help to narrow the field by clearly eliminating
some of the choices for your customer.
· Offer a post-natal package for new
moms. For the elderly, they can immediately eliminate this, but
for moms-to-be and grandparents-to-be it's an easy buying decision.
· Offer a post injury or operation
service. Again, easy to choose or eliminate.
· Offer a no-frills basic package, a mid-range
package that demonstrates value, and the luxury package with all the
bells and whistles. Now you're helping the decision process along
based more on the personality and financial capability of your customer
rather than an hourly rate.
Finally, give them excellent service and exceed their expectations.
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Exceeding My Expectations
You probably have a disabled client or two who choose to
use drinking straws frequently. Ask them which restaurant has the
best drinking straws. Almost invariably you will hear
"McDonald's". They're heavy duty plastic drinking
straws that have a huge opening, probably designed for triple thick
shakes. For people with disabilities a quality drinking straw is
extremely important.
I rarely eat fast food, but when I do I'll go out of my way to find
McDonald's, just because of the straws. (Don't tell, but I always
steal a few extras.)
Once you've packaged your "value meals", focus on ways that
you can exceed your customers' expectations by providing extra levels
of service and quality that aren't essential, but make life for your
clients a lot more comfortable.
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Increase Your Income
Selling to Bank Trust Officers and Other Trusted Advisors
 Many successful private duty
home care companies find that a significatn portion of their long term,
high utilization cases are referred by bank trust officers and
other trusted advisors. Learn how you can build your
business working through these advisors.
Co-authored by
professionals with experience in home care and financial services, this
book has specific steps to help you build relationships that will
generate quality referrals from advisors.
Order your copy today, as an
eBook or print edition, and receive a FREE audio CD
of a teleseminar featuring the authors, Stephen Tweed and Michael
Sullivan ... for only
$149.
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