Here’s a good question for BV professionals to ponder, writes Mike Crain (Financial Valuation Group): “If there are indeed a lot of inferior BV services being performed, why hasn't the marketplace done a better job at eliminating these providers?”
As it happens, Crain’s question arrived on the same day as the ASA’s most recent weekly E-Letter to members, in which guest contributor Barbara Walters Price (Mercer Capital) wrote an article entitled “How to Compete With Low-Cost Providers … Don't!” Prompted by a “lively” discussion on LinkedIn about how to communicate “quality” in valuation services to a prospect who is shopping only on price, she acknowledged the frustration caused by the situation, but her advice was: “Get over it and get on with it.” Some clients will always shop only on price, while some appraisers will always commoditize their services. You can argue with either camp until you’re “blue in the face,” Walters Price said, but nothing will change (except perhaps your blood pressure). In fact, the only thing you can change is your response, she said, continuing:
I strongly suggest using that time to do two things: 1) become an expert in a niche or service line that cannot be a commodity, and 2) find and cultivate referral sources who understand what you do and respect the quality of it. They will, in turn, refer the types of engagements you desire.
Does your practice provide Kias or BMWs? In her complete article, Walters Price lists half a dozen ways to “move your practice to a different level.” In sum, she concluded with this comment from Rod Burkett (Burkett Valuation Advisors):
I've used this analogy before: to get from point A to point B, some people need a BMW while others are fine with a Kia. And as real-world observation shows, there is a market for both cars. As practitioners, we need to decide what market we want to be in. I like the BMW market, myself, for obvious reasons. The wonderful thing is that for my sized practice, I only need a handful of those kinds of clients/referral sources to keep me wonderfully busy.
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