Hey All – As contractors, when you order materials for a job, say windows, what is the % discount you’d expect to receive from your supplier?
Thanks guys . . . Holly in CT
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Holly,
I am not sure I can give you a percentage. I know this. I expect a very good price from the supplier that I spend $100,000 a year with. I hope to get a fair price with the supplier that I spend $5000 a year with.
With my suppliers, being a contractor is enough to get you a fair price, being a contractor who spends a lot of money and pays their bills on time gets you a very good price.
Bruce
dis-counted from what?Suggested retail?
First quote?
What the other yard is quoting?I deal with three yards.
I do about ten thousand a month in materials average, sometimes three times that.At one yard I get aabout 7% discount WHEN I pay on time.
At another I get a 10% WHEN I pay one time.
At a third yard I get NO discount, EVER, but they give lots of free pencols, hats, sweatshirts, and Christmass baskets in appreciation.Guess what - the NET price that I will pay at any of these three ends up within a half percent or so on most things. So what does a discount mean to me? Nada!
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lots of free pencols,
Pencils. BUSTED!!!! I still think you're a god though!My brain + his brawn = a perfect team
I guess that was my point. I do not know if I get any discounts. I know I get a fair price relative to the other yards around here based on my voume of purchase.
I was trying to make the point that if you spend a lot of money with someone, you will probably get a better pricing than the person walking off the street-which is the way it should be.
I did not even think about the HO vs. contractor discussion of markup that Andy brought up.
Yeah, I understood that.The place where I do most of my business started me out witha 5% discount, but they vary it according to your volumn so I now get 7%.Some HOs expect a contractor to make money, but others think 2% is too much.maybe this HO is just planning to build their own house and be their own GC and researching the lay of the land. Maybe they are prey to one of those shysters who sell memberships in buying clubs promising that DIYss can get major big time discounts through them when almopst anybody can negotiate their own special deal for a ten or twenty thousand dollar window order
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The other thing that I have encountered is most people do not really understand how big a fish they are in any given vendor's pond. I used to go to Stock Building Supply here in Austin. Their primary clients are tract builders. I quickly found out that my orders always fell to the bottom of the list. Which is why I go to my current yard. I am not the biggest fish there but I do spend a relatively substantial quantity of money there and get the appropriate level of service and pricing.
My brother is a deep sea diver and buys a lot of hydraulic and air hoses. He was waiting in line at his supplier and the guy in front of him wanted 2 meters worth of a certain type of hose. The hose sells for about $30/meter. The guy starts hounding the sales clerk for a discount because he is buying "so much hose". While this is going on my brother steps up to the counter and buys a kilometer worth of a similar hose. The sales guy looks up and turns to the two meter guys and says "You buy a kilometer of hose you get a discount, you buy 2 meters of hose-no discount".
Not really sure where the OP is currently coming from but I think it is important to know how big a fish you are in the pond.
In-deed!
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Reminds me of the old college days. Buddy and I were in our favorite beer store, guy was buying a couple of cases and asked for a discount. Owner pointed to us and said these guys get that much every other day or something like that.
It was nice to be seen as a redneck high roller, or is that an oxymoron?
So did you get a discount?
Nah, just academic probation. (;-) Roommate and I went to work at a "disco" (not the 70's version). At first the main fringe bene was all draft you wanted, roommie moved in with the manager, the owner's sister, bennies went to bottle beer, then keys to the ranch and take what you wanted, then she started keeping hard stuff in kitchen for us.
What an enabler. An older gal (mid-late twenties), looked like Pippa Scott, I think it was her actually. They were from New Zeland.
Maybe they are prey to one of those shysters who sell memberships in buying clubs
Been there . . . done that . . . got screwed! I might as well have taken a match and burned that $$$. But I was young and gullible. BTW, when I bought my 1st (and 2nd for that matter) new car . . . I paid full list price. Just trying not to make the same mistakes.
>>> "...if you spend a lot of money with someone, you will probably get a better pricing than the person walking off the street-which is the way it should be."Why?There is (was) a law in the UCC that made price discrimination illegal. It was accepted that certain classes of customers were cheaper to SERVICE, and they could be given a discount for that reason.Of course, from what I see, the law does not have any teeth anymore.
I am not sure what the UCC is so I cannot respond to that. In terms of better pricing for larger volumes-I guess I view all sales in whatever shape or form as commission based. If it takes my lumber salesman the same effort to type in an order for 500 studs for me or 5 studs for the guy off the street, I would expect a better price. He has distributed his overhead 100 fold, the effort to load a bunk of studs vs. picking 5 are almost the same.
I am having difficulty presenting the logic here, but it is a key to free markets.
Bruce
Do you want to do the same work for every person who comes along, no matter who they are, or how much business they do with you? If so, you are headed for a business failure.
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Businesses can REFUSE service to anyone they want (whether this should be legal or not, I'm not sure).But, at least once upon a time, they were supposed to offer the same price to everyone.BTW, UCC = Uniform Commercial Code. As the commerce clause makes most business that can be interstate the province of the U.S. Congress, there is a uniform commercial code that is the set of laws for commerce. And one of those laws says that price discrimination is illegal per se. Which means it doesn't matter if the price is favorable to one party, it is still not legal.However as much as this is totally abused it doesn't seem to to have any teeth anymore, or maybe it got repealed, or slick lawyers found enough loopholes that it doesn't matter, or something.
"BTW, UCC = Uniform Commercial Code. As the commerce clause makes most business that can be interstate the province of the U.S. Congress, there is a uniform commercial code that is the set of laws for commerce. And one of those laws says that price discrimination is illegal per se. Which means it doesn't matter if the price is favorable to one party, it is still not legal.""There is (was) a law in the UCC that made price discrimination illegal. It was accepted that certain classes of customers were cheaper to SERVICE, and they could be given a discount for that reason."Which is it?Volume of business could be one way to define that class of customer..
.
A-holes. Hey every group has to have one. And I have been elected to be the one. I should make that my tagline.
As far as I'm concerned, "attitude of the customer" creates another class more expensive to service too
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I'm not aware that the law has been changed (and come to think of it, I believe it is part of the Sherman Anti-Trust statute). I'll try and look up the citation when I get home.However, one only has to look at all the places where it appears to be violated to wonder if something hasn't changed. The cable company runs a special that gives new customers a cheaper rate. They are not cheaper to service, so why shouldn't everyone get that rate?Airlines book seats on the same flight as all kinds of different rates.Hotels charge a higher rate during special events, though they can probably argue that everyone - at that point in time - is getting the same rate.Upper end tool and appliance manufacturers (Festool, Bosch appliances) won't let dealers sell below a set price, which in my book is price fixing and I would think illegal. However they find some way around the law (or the FTC just looks the other way).A class of customer can be defined as just about anything. The point the law made was that it had to be cheaper to service a particular class of customer in order to justify a discount. Building supply houses claimed that is was cheaper to serve people with accounts, so that is how it started.I'm not saying this is desirable or undesirable, just that once upon a time at least, there was a law covering it.
"They are not cheaper to service, so why shouldn't everyone get that rate?"It costs from eight to fourty times as much t enroll a new customer for subscription type services atn it does to renew an existing customer, but new customers are essential to the growth of a business. Therefore it is valid to offer the new customer an incentive to jump in."Airlines book seats on the same flight as all kinds of different rates.Airline seats are extremely time and place sensitive so prices do vary according to value which is constantly fluctuating. I am not necessarily speaking of value to the customer, tho that is true to some degree, but value of a filled roster to he airline"Hotels charge a higher rate during special events,"Technically not true. They charge the full price when demand is high and offer various discounts the rest of the time to induce full use of the facility."Upper end tool and appliance manufacturers (Festool, Bosch appliances) won't let dealers sell below a set price,"I don't believe you kn ow a thing about retailing and marketing based on the foolishness implied in that statement and much of the rest of your arguement...
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bryan---if you and I both walk into the same "piggley wiggley" or whatever---and each buy a can of cambells tomatoe soup---we should certainley pay the same price.
but If Piffen and I walk into the lumberyard he frequents----and order doors
why on earth would I expect to pay the same price he does?-- I don't think i have EVER bought more than 8-10 doors in a year and my relative in-experience in that requires much more "hand holding" from the yard----- which I might add- I am DELIGHTED to pay for
Stephen
BTW--------- I recently completed a roofing project for a customer which required what was ,for me, a HUGE material order-----------one that would have exceeded my credit limmit at that supplier by a factor of more than 2
so-a little nervous I went to the supplier( in person)--explained the size of the order and asked if we could work something out on this.
well--the guy who handles that was not in at the moment--but before I could get home( less than 15 minutes) I had a message on my machine bumping my new limmit up through the roof----and also pointing out that I was an excellent account and that they would do whatever was necissary to help me out with that project and any other one.
I have always viewed myself as a small fish in any suppliers pond--knowing their are plenty of contractors at each supplier who buy more in a week than I buy in 2 months
but apparently prompt payment counts for a LOT
also---following the project I imediately paid off the balance--and recieved a nice hand written note from the supplier---thanking me for the business
so--in short- I think you can be a small fish in a big pond---and still get extraordinary service---- if the supplier "likes" you.
Stephen
Why do you ask? Wondering if you're paying your contractor too much???
how it sounds^-->http://www.youtube.com/watch?v=2shskL0AYuE
http://WWW.CLIFFORDRENOVATIONS.COM
I was wondering similar and thinking that a ontractor probably deserves more like a 40% markup for windows, at least,since there is only one thing that causes more time in selections, and complaints and callbacks than windows.Appliances
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I hate when a non contractor asks that question...
PS..and I don't mean that as like I'm filled with hate...LOLOL
how it sounds^-->http://www.youtube.com/watch?v=2shskL0AYuE
http://WWW.CLIFFORDRENOVATIONS.COM
Hi Andy - No hard feelings . . . I'm not trying to take business away from anyone. We are doing the work ourselves - most of it anyway. The reason I asked is because one vendor I'm working with did say that because we're doing to work ourselves, he'd give us the "contractor's rate". For example, getting quotes for entry doors - one place just gave us MSRP while another gave us an 11% discount off MSRP. So now I'm getting quotes for the windows in the neighborhood of $20,000 - is it reasonable to request a discount??? How much?? 10%?? Thanks.
I'd say it should be cheaper by the dozen..yep. Thats if you really even know if you're getting a discount.
For me...I just give my bids to my three favorite suppliers on large jobs and see who comes back with what.
how it sounds^-->http://www.youtube.com/watch?v=2shskL0AYuE
http://WWW.CLIFFORDRENOVATIONS.COM
"see who comes back with what."yeah - that's the condensed version...LOL
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
"now I'm getting quotes for the windows in the neighborhood of $20,000 - is it reasonable to request a discount??? How much?? 10%?? Thanks."Discount off of WHAT?See the quote you are looking at may already be discounted off the MSRP.You don't care beans about the size of the "discount"
What you want to compare between yards is the net price you actually pay.Something else to consider tho - with windows and doors, they are a high service item. The sales team needs to guide and help you pick the right ones, and if you buy enough of them, you will end up with problems sooner or later, so You want a dedicated outfit selling to you, from the lumberyard salesman, to the delivery guy, the installer, and the company rep. Try to develop an instinct fo r who will serve you best, not just who will quote the lowest price.And proofread the order - twice- before signing off on it. I see more errors in window orders than anything else.
Things like a 2'9" that gets placed as 29", or wrong muntin style, or wrong finish....
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