How do they make a profit? Changeorder?
Doing a general facelift in a kitchen for an old friend. One day he asks me to give him a price to replace the carpet in the den with ceramic. It’s about 700 sf including the adjacent bedroom. So i work up a number, making allowance for moving the furniture about twice, and doing the shoemould, and working around the woodburning stove. And I have seen cracks ion the slab in the other room, so I include some time and material for an isolation membrane in some areas. Comes out to a nice number i can live with, but it’s out of their budget. The price included tile, they had found some decent 18″ porcelain for about $2.75 a foot.
Today the wife comes in with a new sample from one of those 99 cent tile stores, 12″ ceramic, “on sale this week only” for $1.25. Looks like it will do the job. The price is written on the back of the salesmans business card, along with “$2/sf basic installation”. Heck, around here HD charges $3.50 for installation, so I’m wondering where they make a profit … certainly not in the cost of the tile.
Anyway, they’re old friends, and even though we have a strictly business relationship on this job, I told her it wouldn’t hurt my feelings at all if she got someone else to do it. (I wasn’t looking forward to moving all the furniture anyway.) But I did point out to her the incredibly low labor rate, and said that the installers would probably start adding on a lot of extras, and I explained all that I had in my bid. I can’t come down on my price, but I’m concerned that when it’s all over the difference between my price and the “special” won’t be as much as they think.
“When asked if you can do something, tell’em “Why certainly I can”, then get busy and find a way to do it.” T. Roosevelt
Replies
the only way for them to realize the savings, quality and workmanship of the others is to use them. After it's all over, hopefully there was truth in the advertising. If not, they'll know what they missed going with you. If you do it now, they'll always have the low rate in the back of their mind.
One of those no win propositions.
Remodeling Contractor just outside the Glass City.
Quittin' Time
That's why I'm trying to back out and not be too eager to get the job. I hate to see them buy a pig in a poke, but if I do the job at my price, they'll always think I charged too much.
"When asked if you can do something, tell'em "Why certainly I can", then get busy and find a way to do it." T. Roosevelt
Calvin's response is dead on the money. Even if they suddenly change their mind that price will always be in the back of there mind.
I did a large amount of work at a house last year and another company beat my price on a kitchen and hallway of tile. They did it with mexican labor and put down 1/4" ply for a subfloor base with roofing nails. All manually. Took them 3-14 hour days. Guys really worked hard and did everything the most labor intensive way. I can only guess where the profit was made on that job. On the backs of those guys that couldn't speak a word of english. DanT
Absolutely. They're not children, to be certain, but these scenarios remind me of talking to children. Or at least, me as a child not listening to people who'd been there. If you've ever had a five year old, you're probably painfully aware of what I'm referring to. You've told them what's in the bid. You've expressed concern over what might be coming from a different method. They're not hearing that. They're hearing save a dollar. They're going to have to have a job or two bite them for them to open their eyes to a broader scope of things to include in the "important" list.
Just to rant, I'm dealing with it myself now. A friend asked advice and counsel on building his house. I obliged, at length. He ignored my two cents on builders. And house plans. And siding. I sent him to my window supplier with the admonition to avoid XX brand at all costs, and go here instead. Now I got a call from them today saying El crapola window Inc is $300 lower. . . on the whole house. The place I sent him has already given him my costing, which I know is not really very profitable. They can't go lower. On a $20K job he's haggling over $300. And he's going to get the cheap windows, and a few years from now someone will be back fixing, replacing, repairing them. Which will cost a lot more than $300. And someday down the road he's going to say BOY AM I GLAD I SAVED A BUCK!
"If you pick up a starving dog and make him prosperous, he will not bite you. This is the principal difference between a dog and a man." - Mark Twain
You gave them a bid based on an on-site visit and familiarity with the problems with the job.
Then they got a no-look, back of the business card bid.
They can do the math.
Don't feel guilty. That's not the type of competition you want to get into dueling price points with.
Plus, the tile may be problematic. A lot of the cheaper decorative tile nowadays is somewhat softer due to the manufacturing process used to pump it out for those low prices.
In the UK there is a slang name for people who do cheap, shoddy work--Cowboys. I don't know why that expression became popular, but it is. AFAIK there are no 'cowboy' regulars on this forum, but there are plenty out there spoiling the market for honest, trustworthy people.
I think that in the case of the people you are talking about, this is a marketing situation that has already gone wrong, and it probably can't be put right. As soon as they talked to someone else and he mentioned the stupidly low price and they didn't laugh and walk away that was the end of the story.
They will almost certainly regret it but they simply have to go through the process and learn from their own mistakes (or maybe not learn)
John