New Data in Regarding PricingWe do a lot of preaching about the importance of drilling contractors keeping their prices at levels that ensure a fair profit. Too many drilling contractors aren't charging enough and that causes problems for all concerned - the driller, the customer, other drillers and the suppliers. It doesn't make sense to drill yourself right out of business but all too often, contractors succumb to the imaginary pressure they feel to lower their prices. But data from a recent survey only reinforces the notion that far too much money is being left on the table - and unnecessarily so.
Late last year, the busy folks in our market research department conducted a survey which included questions about the factors that drilling contractors think are important when it comes to selecting drilling equipment and supplies. Eight key factors were ranked and price didn't even crack the top three. Respondents to the survey were asked to rank the importance of the different factors on a scale of 1-5. The results:
Factor Average Rating
Product quality/durability -- 4.81
Company reputation -- 4.50
Warranty -- 4.33
Price/credit terms -- 4.29
Brand availability -- 4.18
Range of product offerings -- 3.84
Manufacturer's sales staff/reps -- 3.78
Brand recognition -- 3.74
While it's a generally accepted fact that drilling contractors, as a group, are more intelligent than the rest of the species as a whole, that's no reason to give up hope for the rest of the world. There are plenty of people out there who are smart enough to see things the way drillers do. Obviously, drillers know that other things besides price are to be considered when they are the customer shopping for equipment and supplies. Give your customers some credit; many of them feel the same way. There are plenty of things other than price that they are looking for. When you can deliver on those factors, price becomes much less of an issue.
Water Well LoansPresident Bush has signed a bill providing $1 million for loans to low- to moderate-income persons for the installation or improvement of household water wells.
Some 3.6 million low- to moderate-income households across the country use outmoded water wells, according to the U.S. Department of Agriculture. “For too many Americans, even the most basic of needs - water - can be a challenge because of the cost of drilling or improving a well. Now, more people will have an affordable option,” says Dick Burke, former chair of the National Ground Water Association's Government Affairs Committee, which lobbied for the appropriation and authorizing legislation.
From the $1 million, grants will be awarded to nonprofit entities, which in turn will provide loans to eligible persons for constructing, refurbishing or servicing household water well systems. The loans would have a maximum interest rate of 1 percent with a term of up to 20 years. ND