I am new to the remoldeling contract biz. I gave a bid and need the job bad. She is waiting for another bid to come in. Is it not a good idea to email her and tell her that I will match any bid she gets in order to get her biz?
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red... we've all done it and we all regret it
IF you get the job... you will be working for less that you think you are worth
and .. while you're slaving away.. inevitably.. someone else will call and need you .. for a job you could get a better price at
ALSO.. lowering your price doesn't encourage a lot of people to give you the job anyway.. they just think you were screwing them with your first price
find some other way of bringing in the money besides lowering your price.. go to work for one of your buddies...
how much money were you willing to lower your price by ?
let's say it's $300... write a check out to the Owner for $300 and send it to them... you will be a lot better off doing that than you will be if you lower your price and do the job...
hey.. good luck.. i know the feeling . .. wondering where your next job is going to come from is very stressful.....
but don't forget...
"never let 'em see you sweat "
Thanks fellas, guess I'll wait it out.
Good info above. Just to add that every time I have lowered my price to get a job, it has bitten me. Hang in there!Pete Duffy, Handyman
I will reinforce what others have said.
DON'T LOWER YOUR PRICE! I think that it will make you appear desperate to the client, and as Mike Smith said, they will think that your first price was screwing them.
I am relatively new to the biz, (3rd year on my own). It can be stressful trying to figure out where the next job will come from. Often times I have looked at jobs and tried to find a lower price just to make sure I got the work.
But... it doesn't work. "Buying" the job for less only means that you will lose money. And if you lose money, you won't be in business for very long.
One thing I have learned from this site is that you need to know what it costs you to be in business. When you really have a handle on that, then I think that you look at jobs differently. It becomes clear that you can't undercut your own price just to stay busy. When you become confident in those numbers, you realize that you cannot afford to work for less.
For me, that translated into confidence selling my services, which has led to better paying jobs and more referrals.
It can be tough to hold out when you need the work, but having seen both sides, it is better to walk from this one rather than dropping the price.
Best of luck.
I think depending on what service you are providing and what amount of money you're talking about makes a difference.
My philosphy is that I price my proposal for architectural services based on the initial discussion I have with the potential client and summarize it with a well outlined proposal. In my case I'm never proposing an inflated fee so that I can negotiate it down significantly. If the question comes up, I do say that I have in the past knocked off a couple of hundred dollars to get a job (for some clients that is enough of a victory in negotiation). Howeve, I stress that a couple hundred means $200, not $1,000s, not $500, not even $300.
Don't do it. If she calls back and says the other guy is $x cheaper, ask to meet with her to go over the bids and see if they are using the same materials etc. Maybe he's only doing one coat of paint on the walls or whatever. If she doesn't call in a few days, you should call her and ask what the status is. And don't use email ... use the phone.
"Put your creed in your deed." Emerson
"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
If you do cut your price, make sure you take something out of the scope of work, or add a note about your schedule being flexible, or something. You do not want to just drop your price- if you're giving her something (lower price) make sure you get something out of the deal.
What you get does not have to be of equal value, it can even be trivial. But if you show her you're willing to cut your price without her even asking for it, think what will be running through her head at the end of the job when you ask for final payment.
Jon Blakemore
RappahannockINC.com Fredericksburg, VA
"She is waiting for another bid to come in."
wow ... thinking about lowering a price is one thing.
but it sounds like you're not even waiting for her to say No first ...
U that insecure about your sales presentation?
I've been tempted after being rejected to lower my price ...
but never from the get-go.
Have faith ... and if it's no deal ... sell harder next time. Give them a reason(ok .. a list of reasons) to at least consider you even if U are the higher bid.
Jeff
Buck Construction
Artistry In Carpentry
Pittsburgh Pa
Don't.
Other than keeping you off of Breaktime all day, what good is the job if you lose money on it?
The remodel job I currently am working on was estimated at $5K, HO had a bid of $1300.
She asked if I would give her a bid - I said sure just add 50% to my estimate or ....ummm....$7.5K. She asked what is the difference, I told her the $5K was an estimate, could go up or down depending on what I found behind the drywall, bid was cast in stone unless she changed some parameter of the job.
The $1300 guy must have been unbelievably fast and shoddy, and working with stolen materials. I'll have about $600 - 800 in materials alone. I don't think she would have been happy in the end.
Jim
Never underestimate the value of a sharp pencil or good light.
Red........................
My very first year on my own I had hooked up with a pretty big builder and was taking decks and some other stuff off of him to fill the dead time.
People talk............and the first time you lower your price, all the refferals you get from that job will know to ask you to "Sharpen your pencil" for their job.
If it's slow, you would do better to look for some sort of Subcontract work. maybe installing replacement windows or storm doors or stair rails.
Find a guy who can feed you one or two day jobs and who pays you directly for your work. Make sure you are clear. you work for yourself and are looking for fill in. You're not looking for him to book you up day after day. And, the big one, you run your schedule. Not them.
If you can get three days a week worth of that kind of sub work to keep the money coming in, You won't look desperate to the customer and it will be easier to sell your work for a profit.
Whatever days you don't do sub work..........are work days none the less. You get up and leave the house and pound the pavement. You're just less desperate and less likely to make a mistake.
Don;t lower your price to the public
Very good advice here from Robert:
Find a guy who can feed you one or two day jobs
There are a lot of contractors who would like to have someone who they could pass off smaller jobs to. Or go back and do punch list. Tell them up front that you want to do thier overflow work, or half day jobs or whatever, and that you are not looking to take their main business. "Put your creed in your deed." Emerson
"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
There are a lot of contractors who would like to have someone who they could pass off smaller jobs to. Or go back and do punch list. Tell them up front that you want to do thier overflow work, or half day jobs or whatever, and that you are not looking to take their main business.
Eddie,
I think too often when this kind of question is asked, it's not so much a case of " Can I lower my Price to get work" but more a case of " I've got nothing coming in and I need some work. Should I lower my price to get it".
Then some very valuable information is shared about pricing and selling. But in many cases, The Original poster didn't really want to say " Hey I need Work NOW to pay the bills what can I do?".
If we assume that someone closes 1/3 of the sales pitches they give..........That means they need to present 300% of the numbr of bids they would need to win in order to break even. And it takes time to reach the point of pricing 300% of the jobs you actual need.
So what to do in the mean time? Gotta do something.
It looks so easy up front. And then a few months in what you thought was a six month cushion was really a three month cushion and you're still not making enough sales calls to pay the bills. Hell six months worth of expenses at my house would be $45K. Take the half of that that I provide and I would need between $25K and 30K cash to last that out.
I have been in business for two years, ironic you asked this question today. I gave a firm bid of $800.00 last week to a guy, who was just gonna "do it himself". Today he called a few times before I could answer and asked if I would "knock a little off". I calmly told him that I could not because I would not be able to stay in business if I discounted jobs, that I know what it takes money wise to make it and all he said was "when can you get to it". He will be so happy when I am done in less than a day but I know how to fix houses and I am in business to fix houses and I am prepared to make his rotten siding be
gone and his house sale will be able to go through. Your customer may or may not actually get another bid and why do you think that if she does, it will be much lower than yours. I used to think of these things as well but there is no rhyme or reason as to what a house repair/remodel bid will be. The other guy could be scuz city or bid triple what you did--and or she may hate him??? Quit worrying and like others have said, keep some paying jobs coming and when a bigger fish bites the line you can reel it in. When a busier contractor sends somebody to you--handle it, thank him but keep little problems out of his hair and you should be ok.
This is the hardest time when your starting, Dont look what the other guy does, When i started i filled in to with other guys, Once you lower your bid plan on doing that for 20 years if you last that long. i have had hundreds of guys underbid me and they all fell by the wayside, there has to be enough for profit and overhead, Maybe next week you will get some winners and you dont want to be stuck on a wage job, If you feel you must work cheaper do it on a little job not a bigger one, I have found to people have a hard time getting bids so if you presented yourself well you may be locked in anyway, A call like that would ruin it for you
Red, first thing is that you say you are new to the biz. There is a lot of learning ahead... and even after many years, you'll find that the learning continues.
I don't know the specifics of the project price vs the rate of discount required to get the job. So take this advice for what it's worth.
Do not offer to match just any price.... I am sure that will be a bad situation to get into and not form a good impression of the service you offer. If you offer this before you even know if you are high or not, you put yourself at a number of serious disadvantages.
You may want to negotiate your price later. Make the point that you are offereing a quality service for the price... maybe offer to meet half way on the difference if it is within your acceptable range.
I guess your duty is to sell yourself, which is hard to do. I am a terrible salesman. I absolutely hate bidding and selling. But nonetheless, I manage to pull it off occassionaly. People that are beating you up on price alone are salesmen too... hopefully not better than you.
It is imperative to know your cost for this project too. Then you can deduce how much it's worth on the labor end (ie how much room you have to move).
If you are desperate to get this job because you're broke, then the best advice is to buy ALL of you materials AS SOON as you get your downpayment... assuming that you require a downpayment.
You are new and are going to make mistakes. It's better when they don't put you in serious financial straits.
If you'd like more specific advice, my phone number is on my website. Call me and I'd be glad to help you out as much as I can.
BTW, what area are you from?
When you're this good, EVERYONE wants a crack at you!
http://www.petedraganic.com/
If you call Pete, don't ask to borrow his delivery truck."Put your creed in your deed." Emerson
"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
Favors are favors but business is business. A friend has been using it all week long because his is in the shop.... so you'll have to wait if you need it.
That reminds me of how often I'd rather do a small job for free (for a neighbor or friend) than charge a few bucks. It's easier when it's a favor.
When you're this good, EVERYONE wants a crack at you!
http://www.petedraganic.com/
I was joking pete. Making reference to the "other" thread."Put your creed in your deed." Emerson
"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
thanks, I am from saratoga springs, ny. I may take you up on that phone call sometime. My story is this: I was flipping houses for the past 7 years and it finally got to the point where I thought contracting would pay better with less heart burn. So far the pay is worse and I can't throw down the prilosec fast enough. I've got the skills and fairly likable but I just moved here a year ago and have few contacts.
There is a lot of great advice to be had here.... but be careful as there is a lot that is as uninformed as it gets too... lol.
Anyhow, call me anytime. Daytime tomorrow is good if you're in a pinch. I'll be in and out so if you miss me, leave a message and I'll call you back when I get in.
There is also email if it helps you to consolidate and clarify your thoughts... as well as have responses that are re-readable for reference.
I've been in the exact same shoes you are in. It would have been nicer not having to learn everything from my own mistakes...lol.
When you're this good, EVERYONE wants a crack at you!
http://www.petedraganic.com/
It can take several years to get a contracting business established in a new location. My suggestion is that you get a job working for an established contractor for a while, and gradually ease into side jobs. The financial stress of trying to start up a business while also depending on that business for your income will burn you out right away. There is almost no chance you can make more working for yourself in the beginning than you can working for someone else... I bet almost every contractor here will agree. I know you have to start somewhere, but I would suggest getting at least some of your work from someone else for a while.
You will get the kind of work that you do.
If you are working in a particular area, you will get more jobs there.
If you do roofing and siding, you will get those jobs.
If you are cutting your price, you will get customers who are looking for the best price.
If you do high quality, high priced work, that is what you will get.
I'm over in Bennington, VT - not too far away. I moved here from Boston about 3 years ago and started up with zero contacts.
The best thing I did was join the local Chamber of Commerce and got involved. Volunteered for a couple of things and attended the monthly "mixers" - a 2 hour meet and greet that was primarily bankers, lawyers, realtors and other local business owners. I was the only trade guy at these events and landed alot of work - and still do - through these contacts.
If you're new to the area you need to be visible.
-Norm
The best thing I did was join the local Chamber of Commerce and got involved. Volunteered for a couple of things and attended the monthly "mixers" - a 2 hour meet and greet that was primarily bankers, lawyers, realtors and other local business owners. I was the only trade guy at these events and landed alot of work - and still do - through these contacts.
This is great advice. Just about everyone (mostly lawyers and business clients) I know yearns for the name of someone who can do projects ranging from very small repairs to new kitchens. Most of them live in fancy suburbs and don't know any contractors personally and many have had bad experiences. Everyone has a job they need done, but many people can't find anyone to do them.
Offer to the HO that when the other bid comes in you will be happy to sit with them and compare the two bids side-by-side so that they know they're comparing apples-to-apples (or apples-to-oranges as the case may be).
Sell yourself on the value you bring; insurance, license, experience, gonna be around long enough to warrantee the work...the minute you sell yourself on price - you're done.
Good luck, -Norm
As a GC I will say this :
If a sub ever did that to me I would never call him/her again.
Changing the bid after it is given always leaves the client suspicious of what else is going on.
That'd be negotiating against "yourself". Think about that!
Do yourself a favor and buy this book...its really good!!
http://www.contractor-books.com/TP/FPBP-Sucessful-Bus.htm
Be well
andy
http://WWW.CLIFFORDRENOVATIONS.COM
there are a few things you can learn from this site
lots of times you are the only one bidding on a job even though they tell you they are getting other quotes
be reasonable on a price but do not lower it unless something is taken out
try to allways have a positive answer to a question like can you lower the price ?
say sure if you can take out some of the job ( used that one many a time )
when you show up to look at the job appear to have just come from another job as in a little paint on your hands , boots look well used , shirt and pants not brand new,ball cap has a few stains on it . when you look that way they never ask you about your ability
also people in a profession talk to others in the same proffession ( preferability those making good money )
quite often small jobs lead to larger jobs as they are trying you out
I was slow just before christmas and did a total rebuild on a guys kitchen drawer a real dopey little job that a customer recommended me for
turns out he was a lawyer and told another lawyer who called me to look at a reno of a high rise condo , got the job the day i looked at it based on a estimate which has since doubled , including my travelling time , turned out the condo is at the penthouse floor and the buyer owns the one next door and ultimately intends to make the 2 into one , all because the friend of the buyer said the drawer i did for him was the best one in his kitchen
i rarely bid against any one and i have raisd my rates 30% in the last 3 years
i believe its better to sit home doing work on my own home than to be working cheap for ah's
it has taken me 33 years in business to learn this so much for beeing a fast learner
if you work for friends and relatives and cant get regular pay rates you are a idiot because they dont feel your anything but a cheaper way of getting the job done
having built custom homes from digging the basement to shingling the roof and all in between i now prefer renovations as i need less manpower and there is a hell of a lot less competion ( good people who can do a multitude of trades professionally are hard to find)
another thing i found out was that if you had grey hair you are a expert to many
if you travel a distance to their job you are a expert from affar & they will at least pay your travelling time one way and get the other way byn picking up material on the way home
we are currently booked to the end of may and discussing another 6 months past that and we are 20 miles from the city
a better rate of return allows you to not need to try to get every job yet still take home a decent rate of pay for the hours worked it also gives you some pride in yourself as a professional
Lots of good answers from alot of people but this reply is 100% GOLDEN.
Read it, Read it-BELIEVE ITNobody is as good as they seem, nobody is as bad as they seem either.
Good list but I would not completely agree with this part:
when you show up to look at the job appear to have just come from another job as in a little paint on your hands , boots look well used , shirt and pants not brand new,ball cap has a few stains on it . when you look that way they never ask you about your ability
I think it would depend on the project, and who you are working for. I have done much better closing larger projects while being well groomed.
Bowz
Bowz : you may be right for your own situation or it depends on ones defination of being well groomed
i wear work clothes as in blue work pants and shirt all the time whether im meeting a banker for the first time , lawyer (current customer) doctor , farmer , office worker or potential property buyer ( my other line of income) ( http://www.foxfireridge.com)
the sums of money involved are probally not that large a lot of the time and can very a lot anywhere from $100 dollars to a few times 250m
90% of my customers are women or are the dominating person as a couple
with them i find you have to pass the smell test for sincerity and it helps to like dogs and cats because if you let the dog lick you they often seem to trust the dogs intuition better than their own ( dosent work good if you have a suit on)
its not hard to get a dog to sniff you if you have pets yourself especially horses as all dogs seem to take no offense to the odour even though a human dosent smellit at all
i often discuss anything but the job with people initally and have them bring the conversation back to the job
most sales people i find are scared to death of being led away from their topic and cant say more than a few words about anything else without seeming insecure especially if wearing a suit
busy people dont have time to overly dress if they have enough on the go
next job is for a guy with a high tech business who kept me waiting a hour at his home due to some business problem now he is waiting even though he was prepared to give us the keys to the house , alarm code and the keys for the cars if they were in our way (mercedes) as the family was going to Fla and he wanted us to start right away
I dress for the type of work i am going to be doing for them whether they are a supposed millionare or average joe
dude,
we are not that far apart definition-wise. I do not own a suit, so that is not what I am referencing when I say well groomed.
In the past I would wear clean work clothes (same collared blue work shirts as you) to any look-see at a job. I still do for smaller projects, because I am the one doing the job, so I agree on that point.
However in the last few years I wear "Dockers" and a collared dress shirt to larger projects, like additions, and total gut kitchens. My feeling is that even though I am doing the physical work, there is also much co-ordination and working with people. I feel people are more comfortable with someone who looks the part, not so much of a salesman, as a person who works well with others. Your "dress code" may reflect that also, but I was commenting on the builders that show up in looking like,.....well........less than someone I would want in my house.
I love the "dog test". In my jobsite checklist I have an area to fill out for pets, and people are surprised the next time I show up and know the dogs name. (because it is written in my notes)
most sales people i find are scared to death of being led away from their topic and cant say more than a few words about anything else
absolutely! But that is where the connection to the customer is made for me. and so often the client and I make a connection to someone we both know, by a short offtopic discussion!
Bowz
Bowz : one other angle i use often is to give away stuff i have to remove from job sites, as in fridges ,stoves ,counter tops , garages , dogs , cats virtually anything imaginable i come across including pickup loads of plants
i get paid to haul them away and often hired to install them elsewhere
the reason i dont keep them is the wife & i have a agreement that if something new comes in something has got to leave to make room
i currently have from customers : clothes , cat, antiques, boat, popup trailer, flat trailer ,rugs, small green house of plants,8 home made french canadian salmon pies,a number of inuit carvings, plus limited edition ducks , a piece of meteorite, a prestoric seashell (moulask?) from up north, 4 jet skis on trailers and many other things
in my case it is cheaper for the customer to pay me to haul it to another customer than to pay me to take it to the dump , 5 miles from my house or 30 miles from the city where i mostly work lately
i also find that often one persons junk is another persons gold
giving customers something for nothing beats cutting the price of a job any day
another aspect of living in the country and working in the city is having a supply of free material that city people think are valuable such as rocks , city people think they are beautiful country people cant get rid of them fast enough
redtoolbox,
It's how I sell.
Telehandlers are pretty much all the same.. they have similar engines, trans, and the same amount of steel.. While there are features and benefits to each one, in the end most contractors give up and buy based on second grade math. (There are 18 brands sold in Minnesota alone)
I have access to dealer costs and rebate programs from all of the brands. While the list price differs greatly the cost is usually within 1% differance. Frieght differance between factories is greater than Dealer cost differance..
When I meet someone who intends to buy I don't waste time on price, I simply say that I will match anybodies quote to the penny. Then I focus on reasons they should select me..
You've got to sell yourself..
Why they should select you.. make them an offer that's important to them. Listen carefully. if they don't want to be disturbed before 9:00 agree to it and write it into the contract.. IF they are worried about pets or children deal with those issues..
LIsten carefully to the customer, don't try to mentally plan your next statement. LISTEN!!!! Then repeat back their concern to them.
"So Mrs. Jones you are worried about your rose bushes? Did I get that right? Would you like me to build a fence around them to protect them?"
If she says yes, you've sold the deal. (it's called the mini close) Get them to commit on one small item and they will keep right on saying yes while the papers are being signed..
Nice tidbits Frenchy.
blue"...
keep looking for customers who want to hire YOU.. all the rest are looking for commodities.. are you a commodity ?... if you get sucked into "free estimates" and "soliciting bids"... then you are a commodity... if your operation is set up to compete as a commodity, then have at it..... but be prepared to keep your margins low and your overhead high...."
From the best of TauntonU.
There is also anopther tactic that seems good but one that I fail to employ.
A lot of guys will hand write a contract on the spot... typically on a prepared form... and then close the deal immediately.
I prefer to come back with a well-written and professional appearing contract later. Problem is that this allows another salesman an opportunity to get his foot in the door. I've had a couple over time that I assumed were done deals and then something happened between then and the next day or two.
Nowadays though, I don't always feel as "desperate" trying to win a bid. I often tell them first off that I'm probably not goiung to be the cheapest and if cost is their first concern that they might want to shop elsewhere. I do ensure them that I'll be giving them a good value though. I will use quality materials and practices and be dependable. That approach seems to build trust. I don't try to talk too much or come off as a smooth-talking flim-flammer.
One trick I have learned in negotiations is that you let the opther person do most of the talking and when you make an offer... you make your offer and then keep your mouth shut. The general rule being that the first person to speak afterwards, loses.
When you're this good, EVERYONE wants a crack at you!
http://www.petedraganic.com/
Pete,
Good point about negotiations. Once you ask for the sale, shut up!
the next person to speak is in the inferior position..
I differ from you in that I don't let a better salesman steal my deal. I get a deal on paper. I tell them I'm willing to tear it up if they have second thoughts because I never want them to feel trapped.. (that's a bad position to either be in or deal from) by doing so I display a level of trust with them that in all my years of experiance has never failed me..
They know they can tear it up so why will they seek other bids? Most won't bother. Those that do are suspect and you have that knowledge going in.. Now assume they can say, So-and so bid it for X dollars less.
You are now in a position of power and next move is up to you. MY response is usually, OH! what are they leaving out, what corner are they cutting?
They now have to defend someything they aren't sure of. Very weak position!
If you'd like I keep explaining the process but you strike me as being capable of dealing from that point on.. IF not I'll be glad to share my experiance with you..
Excellent points.
Like I said, my weak point is that I don't close on the spot. Part of my hesitation is that there are so many details with many of my jobs that it is difficult to prepare a complete contract.
There is probably a way to facilitate what I need to but I don't know that it is that much of a concern these days.
When you're this good, EVERYONE wants a crack at you!
http://www.petedraganic.com/
Pete,
I suspect like me you're a bit of a luddite, I hand write all my contracts on the spot. The reason is the close is easier now (if you know how to close and are capable of dealing with objections)
The reason the close is easier is three fold.
1st,
They are excited now. later even when they haven't signed a deal they will suffer buyers remorse. IT's normal.. deal with the remorse issue with an escape clause. Not only does that establish a level of trust but if they back out all you've lost is what time you spent which you would have lost anyway. At least you won't lose it to competition .
2nd,
Because your price now will be lower than your price when they add all those details they forgot to mention. The solid gold toilet seat or whatever! IF they bring it up later, they will decide not to go ahead with the gold toilet seat and you will still get the deal rather than have them look for someone who will include it for free. I don't know if you're aware of it or not but normally customers add stuff they think of as they go. Thus the first in would naturally have a lower price. Along comes a contractor who wants to frame the roof with exotic wood because it's all the rage and manages to sell them on that exotic wood and so every other quote will have that wood. If you are in first and have a signed estimate first they are less likely to speak to that contractor and second if they do they certainly will come back and ask if you can do it for X$
3rd.
You can trade things, well if we can use your bathroom I can save you $300 on porta potti rental. Or pay me 1/3 down and the interest costs I normally have will be saved. That way they get an inkling of the complexity of a bid and will be more reluctant to start all over and hope they are getting an apples for apples deal..
Once they have someones price they don't want to listen to all the details over and over again, all they do is skip down to the bottom of the sheet and look at the price.. Now you're a commodity..
If I were bidding a project I'd have my computer loaded with the things that affect cost, like who pays for the toilet, dumpster, where is parking going to be etc..
I'd have my per sq.ft. costs pretty well mapped out and adjust according to site conditions, complexity and the other critical variables..
I'd most likely give estimates rather than bids right out there but it would be a signed estimate or they don't get a copy. (the printer is broke sorta thing) Why let your competition underdid you by a small amount and get the deal?
Frenchy,
you had recommended a book called "Shut Up and Sell". There are two books with that title, one by Don Sheehan, and another by Craig Lawn. Which is your recommended author?
Bowz
Bowz,
I'm sorry I don't know anymore, I've lent my copy out and it didn't come back.. maybe I should start to keep better track of who I lend stuff to.
a better book is raging fans. this will help with referrals and income streams
frenchy---------
I write virtually ALL my proposals on the spot as well
1) like YOU , I definintely fall into the Luddite class------for the work I am fishing for, this is an asset.-----plus-- I LIKE writing them by hand, will ALWAYS write them by hand-PERIOD !
2)---- I have had MANY customers tell me, at the conclusion of the job---as they hand me a check-------" you know---when we saw how neat your hand writing was we KNEW you would do neat work"-------------
I guess all those years of drafting classes paid off in neat lettering ability---even 25 years later. As a roofer--most of my proposals are highly similar---so I end up writing the same things over and over--------that way I can spell everything correctly( or at least mis-spell it consistently, LOL)
3) I try to make an appointment for a specific time, if humanly possible.-I arrive at that EXACT time( even if I have to wait around the corner,idling, for 10 minutes to do so).----- when I arrive-- If the customer doesn't immediately comment on me being right on time--------- I apologise for being a a few minutes late.--9 out of 10 times the prospect immediately looks at his watch and says--" oh, no--don't worry about it--you are right on time by my watch"------------- Now--when I LEAVE---he has a hand written proposal in his hand.---------- by the time I leave-- I have demonstrated at least 3 things- I am prompt, I am neat, I am efficient
by the time most of my competitors leave----they will have demonstrated they are tardy, they are not as neat and they are not as efficient
4)the smaller the job is-the more important it is to give a firm price--right there on the spot.--any job taking one day or less--will almost always sell right there on the spot. It's definitely a case of " the early bird gets the worm"----------- price is essentially irrelevant on these one day projects. most other contractors don't want to bid them, customers have an incredibly difficult time getting anybody even to look at them.
I WANT them -- because 4 jobs, 5-6 hours each per week---pays MUCH more than working 50-60 hours on a bigger project.
BTW--- I do realise this hand written approach isn't feasible on larger, more complex projects-----but it works very well for me.( Remember--part of what most of us are selling--is the work of our hands)
Stephen
Stephen,
I like your approach to sitting around the corner for a few minutes prior to an appointment. When able, I do that to slow down and mentally prepare for what I'm about to do. Otherwise I've found I rush in from the place I've just been with a load on my mind and I can't concentrate on selling the prospect. Instead of working through my sales process I stumble through it probably missing most of the important parts.
I've been meaning to develop a blank T&M contract that I can bring with me to repair type calls so I can try to close it on the spot. It seems very inefficient for me to to have to come back to the office, type it up, schedule another appointment and all that. In fact I think I'll go do that right now before I get sidetracked on something else.
Thanks Neil
I use a laptop, I have an aircard and a portable printer. I use a standard contract form that is fill in the blanks. I fill it in as an estimate and print it out the customer reviews it and when agreeable I can then convert it to a contract and have the customer sign. I only use contracts on large jobs and use a time and materials bidding process. Using the laptop gives me an office in my truck and when I get home I leave the office in the driveway.
#1 objection is time, people say its money but its really not. Money is number 2. Mostly people want time to digest how much its going to cost and dont want to feel pressure. It cannot be overcome because people will just cancel later. Read my other post I believe its #52 in this discussion. What you are selling is you, people buy because they like or feel comfortable with who they are buying from. If you are competitive you will get the job. People will pay to feel safe and secure as long as you produce a quality product. Sell yourself first and the job will sell itself.
I would be interested to know what all you have in your contracts.
How do you state change orders, up front funds, what could go wrong,etc
What is the most important things in a contract?
Brant
From my "Terms and Conditions" page.... you may use any of it you wish. Please consutl with your attorney as to the legalities as they apply in your case.....
DEFINITIONS: The “contractor†refers to Central Diversified Contracting LLC, it’s officers, employees and subcontractors.<!----><!----><!---->
The “customer†refers to the party or parties for whom worked is being performed by the contractor.<!----><!---->
1. Products: The contractor, at his discretion, reserves the right to make changes or substitutions to any or all products, finishes designs and techniques specified for use in the contract where he deems so necessary. Such changes or substitutions shall be made with products, finishes or techniques of reasonably equal value or quality. Where specific brands, types or qualities of materials are not specified, the contractor will make all selections or must approve such selections where made by others. No approvals from any other parties are required for the contractor to make changes as specified above.<!----><!---->
2. Scheduling: Scheduling for all projects will be set by the contractor. Changes to or delays in scheduling may be made by the contractor without notice when deemed necessary by the contractor. Influences such as customer scheduling conflicts, supply delays, adverse weather conditions, or other means which may cause substantial delays to the timely completion of this project may cause, where the contractor deems necessary, the contractor to engage in other contractual work for other parties, therefore delaying the continuation of work on this contract until other obligations have been fulfilled. Furthermore, contracted work beginning during a delay of another contract may be postponed at any time in order to complete ongoing contracts elsewhere. Scheduling, postponement and continuation of contracts will be arranged at the contractor’s discretion.<!----><!---->
3. Non-scheduled delays: No delays to the progress of the contractor may be caused by the customer and/or his affiliates, associates or subcontractors unless such delays are first approved by the contractor.<!----><!---->
4. Additional materials: All additional materials of any nature, relative to the contract work and supplied by the contractor or his affiliates, associates or subcontractors, will remain the property of the contractor when not used in the project execution.<!----><!---->
5. Utilities: All utilities and necessities such as but not limited to electricity, water, gas and heat are to be supplied by the customer as and when needed by the contractor, at the customer’s expense for the duration of the project.<!----><!---->
6. Access: Ready, unobstructed access shall be provided to the work site for the contractor, his affiliates, associates and subcontractors at all times. The work areas shall be free of hindrances and hazardous materials and situations imposed by those other than the contractor, his affiliates, associates or subcontractors. The work site should remain reasonably secure in the absence of the contractor so that others do not enter the site. The customer may only enter the site at their own risk with the understanding that there are a great many conditions and dangers which may cause damage, injury, serious injury or death. Any and all damages caused or allowed by the customer or others not explicitly authorized by the contractor to enter the work site are the full responsibility of the owner. Ample space will be provided to the contractor by the homeowner for the secure storage of materials and equipment at the job location.<!----><!---->
7. Payment: Payments are to be made as directed in the contract. Any and all late payments are subject to monthly late fees of the greater of either $25 or 1%, of the amount past due, per month, beginning on the date due and continuing on the same day of each following month until the debt is satisfied. These same outstanding balances will also be subject to financing charges at the rate of 24% per annum compounded daily. If such outstanding debts are not satisfied within a reasonable amount of time, legal action will be taken. All expenses related to the collection of an outstanding debt shall be charged to the customer and will become either an addition to the existing debt or a separate debt at the contractor’s discretion. All payments, in the form of check or money order, are to be made payable to “Central Diversified Contractingâ€.<!----><!---->
8. Changes to contract: All changes, being requested by the customer, must be submitted in writing to the contractor and signed or agreed to in a form of written verification by all parties of the original contract. Such change orders must include a description of the change in the original contract as well as the amount of compensation for the changes. These change orders are subject to all the terms and conditions of the original contract. The contractor may make, without notification, changes to plans relative to the contract where such changes are deemed necessary by the contractor.<!----><!---->
9. Excavation and construction: Where impediments exist, bearing on the progress of work by the contractor, such impediments are to be removed or relocated at the expense of the customer. Such impediments are most typically but not limited to utility lines, cable lines and supply lines both above and below ground as well as natural unforeseen obstructions such as solid rock or large boulders below ground which must be excavated or removed and disposed of. Typical ground excavation assumes the removal of soil, clay, sand, and manageable rocks and should be of no additional cost to the customer.<!----><!---->
10. Debris and waste: The contractor agrees to remove all contract related debris and waste from the site and dispose of properly unless stated otherwise in the contract. Any garbage not produced by the contractor must be removed and disposed of by the customer at the customer’s expense. The contractor cannot dispose of any hazardous materials, appliances or general refuse unless otherwise agreed to in the contract.<!----><!---->
11. Permits, bonds and insurance: Permits, bonds and insurance shall be provided by the contractor and are included in the contract price unless stated otherwise in the contract.<!----><!---->
12. Non-compliance: Non-compliance, by the customer, with this contract or it’s terms or conditions as provided herein may result in one or more of the following: the delay of work, incompletion of contract by contractor, additional fees being assessed to the contract by the contractor and / or the termination of the contract by the contractor. <!----><!---->
13. Cancellations: Once signed, the cancellation of this contract by the customer may result in a penalty of 25% of the total contract price plus any expenses incurred by the contractor where the cancellation is committed without the agreement of the contractor to do so. The contractor may cancel this contract prior to commencement of work and return to the customer any monies deposited with the contractor for this contract by the customer. In the case of the contractor canceling this contract for non-compliance with it’s terms and conditions, the contractor will return to the customer the balance of money deposited with or paid to the contractor less any amount for work performed, materials supplied, expenses incurred and penalties assessed.<!----><!---->
<!----><!---->
<!----><!---->
I (we) have read and fully understand the terms and conditions of this contract and understand that they do apply to all work performed by the contractor for the undersigned customer unless specified otherwise in writing:<!----><!---->
<!----><!---->
When you're this good, EVERYONE wants a crack at you!
http://www.petedraganic.com/
The passage copied below would cause all sorts of problems with the clients, architects and GC's I work under. ""1. Products: The contractor, at his discretion, reserves the right to make changes or substitutions to any or all products, finishes designs and techniques specified for use in the contract where he deems so necessary. Such changes or substitutions shall be made with products, finishes or techniques of reasonably equal value or quality. Where specific brands, types or qualities of materials are not specified, the contractor will make all selections or must approve such selections where made by others. No approvals from any other parties are required for the contractor to make changes as specified above."" Who determines the "reasonable equal" portion ?
I routinely ask first time contractors if they can 'sharpen their pencil'. And if they do, I usually don't use them. They just proved to me that they are not giving me their best price up front. Then I start to wonder just how much more water is in the bid, so I am now less comfortable with the 'sharpened' price than I was before.
I hire the ones who defend their price. When I was in sales, we were taught that you will close more deals by holding firm (presuming your price is competitive to begin with) than by discounting.
When pressed to match the price of discounters, we liked to reply "If I match their prices, do I get to match their terms?' This usually gets the prospect to ask 'Whaddiya mean?". Now you get to re-affirm your quality materials, workmanship, etc.
Good luck.
This brings up one of the most common mistakes in every business: letting your product become a commodity. That is, letting the customer believe that what you sell is no different that anyone else's.
The key to avoiding that is to emphasize how you differ from the other guy. You're selling value, not just lumber and nails. Are you faster? Provide better clean-up? Better materials? Better workmanship? Doing some design work? Employees screened and bonded? Is the company owner readily available?
These are the sorts of things to stress. It is also important, as time goes by, to keep in touch with the customer. Go over the job again. Perhaps there have been changes that will allow you to revise your price. "If you use granite instead of marble, I can save you $300," etc.
I have encountered a number of times where bids which were incomplete and came in less then mine. It always pays to ask to take a look at the bid. If your competition does not have a complete bid it will look poor to the client and you will most likely win the bid.
gb93433
At best you are doing damage control at this point. Pretty difficult for a homeowner to remember who said what and offered what even if it is in black and white.
Most fall back to second grade math at this point.. Now you are a commodity. you need to distinguish yourself in a very positive way inorder to eliminate the competition.
IF you must persist because that's the limit of your sales skills, your best defence is a simple chart listing what you offer and the cost of each.
Homeowners all hear that everyone is better quaility than the next guy so find something concrete to hang your hat onto and have them remember you by. (you use gold plaited nails or you've work in the White house.. that sort of thing)..
You are right. I have said that in most cases with me that if the person is shopping price they don't want me. What I mentioned is the tip of the iceberg. It has come up only when people are shopping price and do not know much about my work other than that a friend or someone has recommended me. It has never come up on a large job just small amounts of work. Often when I talk with people I tell them about buildings I have built and then tell them to drive by. When they do their homework almost always I get the job. During our conversation I tell them that the price I give them is for a completed job and that I will not come back later and ask them for more money. I also tell them that I do not give partial bids. Almost always they ask about that practice. That alerts them to poor practices in the business. On larger jobs in most cases the work is mine because the person has seen my work. My philosophy is that my current work is the key to the next job. Fortunately for me when I was ignorant I worked for the best contractor in the area. It wasn't soon and I realized what was going on. One day he told me that I needed to go into business for myself and he would help me get started. He did and it gave me a great start. In the past few years I experienced something I had never encountered before. A few times people had seen my work and assumed I would be expensive because the work was nice. For example I had done a home with several arched doorways and a couple saw that and assumed I would be expensive for something they wanted. Later I found out that they hired someone else without discussing their wants with me and then when I talked with them they mentioned to me about the work until after it was done. The work was poor and the man charge about 1.5 times what I would have. I knew the man and he did not have the experience not knowledge to be able to do the work very fast or very good. Because of my skills I actually make more per hour than he does but charge the customer less.
gb93433,
I know exactly what you mean about people assuming that you are expensive. I've been selling Forklifts for 6 differant manufactures and I have access to dealer cost on every single brand on the market. There isn't 1% differance between them in dealer costs once you take an apples to apples deal and get to real costs. Often the only real differance is in the cost of frieght and even that can pretty much be negated.
That's hard to convey in any meaningful way. That's why I mention all the time that in an apples to apples deal I will use my competitors price. (in fact the few times I've been taken up on it I needed to raise my profit in order to sell at that price, don't always assume that the other guy is cheaper!)
The advantages of matching a price rather than beating a price are several.
First
you eliminate those who price shop.. If everybody knows that a dozen ears of corn sell for a dollar nobody will drive all over looking for 13 ears for a dollar.. When they want corn they go buy corn.. they don't feel a need to haggle..
Second
those with poor reputations eliminate themselves.. Try selling wormy corn for 13 for a dollar or even 14 for a dollar.. Nobody wants it! they know that corn should be 12 for a dollar!
Third
real quaility can shine and command a real premium. It's hard with an empty book to command a premium, but if everybody knows that your work excells and you become a "Name" to those in the know, you can not only pick and choose the jobs you want you can cammand a premium for your work.. Oh, but I own a Picasso type selling..
Fourth
You'll be more efficent, You can ask those who want you who recommended you to them.. as if you are deciding if they are worthy of your time.. That way you can not only reward those who gave you referals (which is simply good business manners) but evaulate the client in advance..
I will tell you what I know about this. 1. show up on time (15 min early) 2. dress professionally 3. Listen to the customer 4. ask if she is interested in other options 5. quote on what is wanted by the customer. 5 Follow up phone call to thank and ask if they thought of any other questions that you could answer for them.
So many contractors dont do this that I get many jobs over when I just showed up and quoted on the fly.
If you put on the bottom of your bid "will match anyother bid" make sure you only match what is in written and be prepared to show why the lower bid really doesnt make sense. It is easier to blow holes in someone elses quote than it is to lower your standards. Many times I explain what the job will look like or why it cant be done due to expenses etc and the customers mindset is "wow, he really knows his stuff".
People want to deal with professionals who will do what they say, when they say it and they want the job done right. Focus on that and you should have an endless supply of work.
Want to make sure you are competitive, get some quotes from your competitors on the type of work you do. then you will see what is being offered and at what price. I shop my competitors twice a year just to see. Its amazing to hear what some contractors will say to customers that is just wacky!
That might be a good thread to start, what is the wackiest thing heard by contractors to sell a job? bet there are some good ones for that!
Do that and then you start thinking where you can cut corners. That in turn leads to the kind of work that gets no referals.
Mike
Redtoolbox,
I guess the question really is, did you bid it high or on the money? If your bid is in line with what you need, I would never lower an estimate just to get the job, wait it out.
If she is looking for the lowest price do you really want the job anyway? Usually, you get what you pay for. If you can present yourself, your company, and your proposal in the best way possible
why compromise your requirements. I have found that the trick to my business, so far, is to bid the job to what I need, do the job to both my expectations and the customers, and just blow the customer away.
I have found it slow going for the first year, but I have found that I am the go-to guy if you want something done to an ultimate standard.
I am by no way the best out there, by no means the cheapest, but when I am done, you will be smiling. Remember, we are dream builders. We are so fortunate to be asked to improve the one most precious thing to anybody, their homes. If you can relay this you will succeed.
Sell yourself, don't compromise yourself. Build your business, don't cut it off at the knees to begin with.
Mike Gavrillen
Ocean State Builders, Inc.
You can think about it but donnnnnn't do it.