Economics 101 and the Lost Art of Carpet Cleaning
 
Technology, especially information technology, has increased individual productivity and income while at the same time lowering consumer prices in industries that are able to utilize it. And since technology driven products have dominated consumer spending lately, there is a general expectation among many consumers that all prices should be lower.
 
But, what about industries that don’t march to the binary mantra, i.e. those employing raw commodities, the rawest of which, people, to generate production? Industries like plumbing, air-conditioning and house painting. Carpet cleaning is one such industry.
 
Carpet cleaning prices have changed little over the years despite the increased cost of delivery. Profits and wages have lagged relative to other industries making the profession less appealing. The result is a “skill drain” toward more forward-trending and lucrative professions. With less qualified people to draw upon, carpet cleaning companies are experiencing more customer service problems and lower profit margins.
 
This is also exacerbated by the easy-in easy-out nature of the business. I knew someone who printed some business cards on his home computer and went door-to-door soliciting business and then rented equipment from a supermarket and did the jobs. He had no training and his only experience was cleaning his own carpet at home. He charged whatever price he could get and lasted about three weeks in the business.
 
Economic forces are eroding many professions today. Sixty percent of primary care physicians don't recommend the profession and want out because of health insurance paperwork and malpractice insurance rates. They are having a hard time practicing medicine.
 
So what's the solution? I have a very fine dentist but I thought the cost of his services were outrageous considering the amount of time he spent with me. Then one day while waiting in the chair I started adding up everything that went into that hour. The dental assistant, secretary, office overhead, equipment, lab, insurance, materials, his continuing education and many things I'm sure I'm not aware of and I began to wonder how he made a profit.
 
So there's a reality gap with many industries. To remedy this, companies should focus more on educating prospective customers than just "advertising" to them. It's been our experience that most people are willing to pay a fair price for good service once they understand what's involved. I now feel I'm getting a bargain with my dentist.