I’d like to bring this subject back to life again. There was a short 4-post thread last month (http://forums.taunton.com/tp-breaktime/messages?msg=33525.1) on it, and I’m sure there must have been others in the past. It’s a subject that comes around and around. My interest is renewed because last night I worked till past 2am getting a ‘rush’ estimate ready for a guy who just had to have it first thing in the morning so he could book us fast while we still had an open date to start.
At 8am, the little dweep calls me to tell me he didn’t like the ballpark price I’d given him verbally when I went to look the job over–so he’d called another guy before he even saw the written estimate he’d insisted on having. But he didn’t bother to tell me to forget about doing the paperwork.
I really felt like saying, well toad face, you owe me a C-note for the time I wasted on you–but I couldn’t honorably do that, because I’d never said anything up front. So I bit it back, and just pointed out to him that if he’d had the common courtesy to tell me that yesterday, I could have saved myself a few hours useless work.
Then he says, Yeah, well the other guy bid $2000 less than you did. (This is on a 2200 SF, 4/12, two-valley tear-off and re-shingle using $16/pack shingles–In other words, there isn’t that much slack in the job so I know right away who the other guy is: Mr. I-Don’t-Really-Exist.) I say, if you can get someone to do the job for that price, you’re gonna get exactly what you’re gonna pay for it–but don’t call me to fix it when it leaks. And I hang up, and go downstairs to make a cup of coffee.
For years now, whenever I encounter an ‘insurance job’ (replacing entry doors/windows broken during a burglery, for example), I state up front: I will charge you X dollars for the estimate, which is deductable from the price of the job if you hire us to do it. This is to avoid using my time, skills, and computer to print out a nice estimate that the guy will take to his broker, get a check for, and then do the job himself or just fix the busted jamb with some silly putty and pocket the money.
I haven’t had any resistance to that position for insurance jobs. So why am I so afraid to extend it to all new customers? (We never have this problem with old customers; they only call us when they’re serious, and they usually don’t even ask for an estimate. Just a starting date….) It seems to me if they’re serious, they shouldn’t object to a refundable estimate fee if they hire us to do the work.
What are your thoughts, people? I think estimating is the hardest part of the bloody job. Shouldn’t I get paid for it, especially if that’s all I’m gonna get from some slime ball?
Dinosaur
‘Y-a-tu de la justice dans ce maudit monde?
Replies
This is a subject that fascinates me, too. I think a ballpark figure is all they ought to get for free. Sounds like you got caught by one of those people who give HO's a bad name. I think you are totally entitiled to demand a fee for a written estimate after you have given a free ballpark figure
John
I just quoted a bearing wall removal with replacement by a post and beam. The job needed engineering to even start the process. HO agreed to the up front cost of the engineer and CAD work for the job, payable the day the engineer scheduled his study. They got the specs. for the post and beam with drawings for thier up front cost. I made am minimum fee for setting it up.
They will get a written proposal today with prelimary drawings. I use a design draftman for this type work so my fee for the engineer is enough to pay the draftman. The HO gets to keep the written proposal. The drawings leave with me unless they are willing to purchase them. if they accept my proposal the design and drawing cost are deducted from the final job cost, not the quoted price.
I explain the process durring my first meeting with any client, and follow it up with written proposal/agreement that must be signed befor I start the process. No signature, no submission.
I do this on all major remodels or additions. Like you, I have been burned to often by what I consider unethical homeowners. Even once had an addition built off of my priliminary drawings. Took two years to recover a design fee through legal action.
Dave
the title of the thread and the contents of your post brought to mind one of my personal head shakers.
terminology estimate and bid.
sounds to me you were putting together a bid, a price you were willing to do a job for.
I know trying to change the vernicaular of using the word estimate when people mean (at least to me bid) is a bigger uphill battle than people charging for bids.
if you do a search here or JLC you will find threads on the subject.
Sonny is back so you will find at least one person agreeing with you. And as I remember there are at least 2 or 3 other regular poster that charge for bids.
bobl Volo Non Voleo
That terminology mix jumped right off the page at me too.
I don't do bid work - estmates only. Most of my jobs move forward based on the ballpark only at time and materials or cost plus.
but for anything involving more than a couple of hours estimation or CAD work, I am on the clock, and they know it up front.
Asking for a deposit of 200-500 bucks to be applied to the design/estimation fee is a great way to get a sense of how serious they are. You'll see it in the face of the lookie-loos right off..
Excellence is its own reward!
Piffin,
I've read some of your posts on how you deal with your customers and it seems like you really have it the right way. I like your pro-communication and honesty approach.
My question to you is, and this relates to the current thread, how do you deal with customers who have an idea in mind about the design or scope of their intended project but just have no idea how much it should reasonably cost? If they're not in the trades (thereby knowking about labor costs) and don't know materials costs, how can they adequately assess if their "X" amount of "Green" in the ol' savings account is enough to do the project? It sounds like you'll give them a ball-park "estimate" at no charge? My humble opinion is that's the right thing to do (at least until they start wanting a lot of details). But, which comes first, do you ask first, "How much green you got, mon?" or do you say, "It's going to cost ABOUT this much, can you swing that plus a little cushion, mon?"
I'm only wondering because it seems like some people here get tweaked when customers ask for three estimates or don't know how much they should be expecting to lay out. But how can you blame people when they honestly don't know what to expect, and secondly, if they get a number from one guy whom they don't know, why should they be blamed for getting a second opinion (you ask doctors for second opinions, right?)? I know HO's have screwed people and it's too bad for the innocent HO's who just want a bit more info.
BTW, I offer to pay for estimates if it's more than a quickie 5 minute look and guess what it'll cost. That's what I'd expect in my line of work and that's what professionals deserve.
Thanks, Erich
Thanks for the compliments.
Most of my customers have the bucks without question but it is a matter of deciding what to do with them.
About once a year I deal with somebody on a tighter budget so I know what you are talking about. I will enter a conversation discussing costs genericly. two or three years back there was an older couple whjo wanted a new kitchen. I wasn't sure they could afford it and pointed out that I wouldn't want to design more than they could afford so I needed a budget liomit to owrk to. The old man was leery of providing that info. So, I described a few other kitchens I had done and gave ballpark figures for each of them. After about three such, the forty thousand dollar figure clicked. He said, "I suppose I could come up with that much for this job if you think it can be done for that amount." I told him that I could come up with something and got a deposit for design and estimation and three days later presented them with a proposal for a $37K design. They made some changes and we found some extra rot that brought the total bill to about 42K. He was happy.
I am working today on an estimate for a half million dollar job. This is to restore a two hundred year old Cape for one of the wealthier men in the country.
He had a design two year ago that would have been atrocious looking more like a California Bungalow to look at and that estimate was in the neighborhood of 900K. ( I found this out later in process, not up front) Then he had a restoration archy and contractor from away look at it and give him a rough budget of 750K
I poked around in the house and measured it in my mind, in comparison to past jobs I have done and wrote him a letter(still ignorant of these other figures from the past two years) to say that the house could be repaired and made liveable for about a hundred thousand, o5r that more extensive work and additions could be done in keeping with their stated goals but without being purists about "restoration quality" for something in the neighborhood of 4-500K but that if he wanted very high end fixtures and historical restoration quality, he should plan to spen something more in the neighborhood of 750K but that the sky was the limit.
This approach allowed him to choose and to set the budget in a face saving way so as not to appear cheap when it is important to know how and where you are spending your money. It doesn't matter how much you have. Even big rollers are wise enough to plan ahead for a budget.
So I have had two design conferences to refine the concept plan and am now beginning the estimation work. I'm curious to see how my ballpark compares..
Excellence is its own reward!
"I'm curious to see how my ballpark compares."
it's been my experience that "Fermi Estimates" are usually pretty good. as long as you understand what they mean.
when someone has the experience and knowledge to make them.bobl Volo Non Voleo
the title of the thread and the contents of your post brought to mind one of my personal head shakers.
terminology estimate and bid.
This is a great big fat part of the problem, I agree. And it's one of the first things I address when we start talking about $$$ instead of when??? or how???.
I always explain:
1) I don't do work on flat bids, fixed-price quotes, or piece-work UNLESS it's cabinetry or other work done completely and wholly inside my own shop, where the conditions are totally within my control. (And I charge by the hour to install the stuff I build on a flat quote in the shop.)
2) All site work is done on a cost-plus or T&M basis: the 'Estimate' I give, whether verbal or written, is not a binding figure--and I emphasize that the bottom line of the estimate should be looked at as a minimum price.
3) If a customer insists he just HAS to have a flat price for his own peace of mind ("I can't go into this project not knowing exactly what it's going to cost me"), I explain that I will give him a flat price--but that it will 99% sure cost him money because I sure as heck and not gonna take any chances on losing money on the job, so I'll do my regular estimate, and then add on anywhere from 50-100% extra before submitting it as a quote. The customers that want me to do the work understand this and accept it as the honest statement that it is. The jerk-off artists and wheeler-dealers whine and honk and try to
When I make up a written estimate, the back of the form is printed with the following text:
PLEASE NOTE THE FOLLOWING STATEMENT OF TERMS FOR ESTIMATES IS PART OF THE ESTIMATE. READ AND UNDERSTAND THESE TERMS BEFORE ACCEPTING OR SIGNING THE ESTIMATE:
"IMPORTANT NOTE: Please understand that an estimate is not a fixed price quote. Your final bill will be calculated based on hours actually worked and materials used. During renovation or remodeling work on any building there is always a significant risk of uncovering hidden problems which can augment the estimated cost of the original job. While we endeavour to estimate as accurately as possible, we make no guarantee or representation of any sort as to what the actual cost of your project will be. You should therefore consider an estimate as an indication of the minimum cost for completeing your project. As a courtesy, all problems uncovered during the course of your project which could lead to a significant increase (more than 10%) over the estimated price will be presented to you as soon as possible. At that point, you will have the option of either abandoning the project or modifying it to include the additional work made necessary by the underlying condition of the building. IN NO CASE WILL YOU BE BILLED EXCEPT FOR WORK ACTUALLY COMPLETED.
Labour rates as specified in the estimate are guaranteed for a period of 90 days from the date of the estimate. Skilled Tradesmen or Apprentices with or without CCQ 'competence' cards, Helpers and/or other unskilled labourers will be billed at the indicated rates for the type of work done by each. Licensed personnel will be used where necessary as subcontrators. Materials, equipment rentals, fees, and subcontracts will be billed to you at our cost (gross) plus 5%, plus 15.025% as an amount equivalent to the combined sales taxes we have paid on your behalf. Materials prices are subject to change without notice.
If I could be any clearer than that, I don't know how I'd do it.
(And if anybody wants that language for their own forms, be my guest.)
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
Dino
Most of the work I do is a quick estimate.
If I must do a written quote, I explain that it doesn't include changes or some problem no known before.
I had an electrician friend who always quoted time and materials, if he was asked for a written quote, he always added it up with ertras to cover unseen surprises. He tried to explain to the customer that time and materials would be less expensive, but they never listened.
A few years back, I did a bang up job on a quote with drawings and all. The company gave my quote (and drawings) to a competetor who under-bid me.
They wanted the job started ASAP, so when I didn't hear from them in a month, I called to ask the status. I was told the job was given to the other company because the price was less and they would start in 2 weeks.
The other company didn't start the job for 4 months, didn't complete the job for over a year, didn't follow the plan I laid out, came back, redid the job following my plan the next year, billed the company by the hour for all the extra work (including the redo).
In the end, it took over 2 years to finish, cost 3 times my quote, and didn't work as well as my plan.
I don't give quotes and drawings out any more. And don't work for any large corporations.
Jeff
Charging for the "Proposal" is the easiest way to weed out the wankers that would otherwise delight in wasting your time. I believe in quality service, and making my customers feel like they got alot for their money, but some people want to see you jump through hoops before they give anything up. Personally, I think they are testing how far they can push.
Two recent success stories:
This guy wanted a beautiful custom mirror made, with leaves and grapes and all kinds of stuff. After spending about an hour of my time checking resources for the parts, I called him and said it would cost $XXX.XX for the design fee and a 1:1 scale drawing. The price for the actual mirror would be $XXXX.XX. He passed because some other guy apparently had more time on his hands. I only lost an hour's worth of time.
A old friend wanted his kitchen redone. His new girlfriend is a cabinet maker(really). He deferred every question and decision about the project to her, who had never been a GC for a kitchen remodel. She had a notebook/ checklist she got from HD to use as a guide. Of course, a few suggestions I had concerning critical path, etc., were completely opposite of what the HD list said to do.
I charged $XX.XX per hour in writing their proposal, about 4 hours, said it would be deducted from the big number. My proposal was delivered on time, on the exact date she asked for it, with the exact specifications she asked for, and I left my schedule open to start the next Monday.
She chose a woman contractor, because my friend said they really "bonded" at the sales call. So she took my bid, with all of my specifications, gave it to her new friend/ contractress, and I took her money for my time.
SIX weeks later, the kitchen has had a myriad of problems that they are "discussing and working out". It was left in a gutted state for way too long when not enough progress was made. Their plumber is some kid they know from the neighborhood. Talk about a nightmare. At least they used the sparky I suggested.
Here was an opportunity for a beautiful, professionally finished kitchen, done by a friend for a friend, and that's not going to happen now because a neophyte HO chose their feelings over the facts.
At least I got my money. I can't wait for the kitchen warming party at their house, that is, if it ever happens.
Thanks for the rant time. rg
These comments about giving work away can easily be overcome. no sense in doing this work for the competitors.
The only thing the customer needs to have when you are figuring for bid is the number on the bottom line and a perspective drawing or two.
No list of materials etc needs o be broken down for them since most of them won't understand it anyway.
Some examples:
I had a lady who wanted crown molding in the hosue we were building for her. She kept having me reprice dofferent ways of doing it with a goal of saving money on that one item. I spent more on labour (she paid me) for time to keep redoing the materials list than she saved on shopping it around.
I once provided my line item breakdown to a costomer who proceeded to pick it apart, thinking we didn't need this, that and the other thing. I had to spend two hours explaining each item on the list. Then he deleted carpet in one room and couldn't understand why I then had to add back on after subtracting for the carpet cost because we then had to install a threshold at the door to that room.
Just the other day, I got a call from a lady who haad seen a garage with loft apt I had designed and built for a customer three years ago. She admnired it and wanted one just like it. The problem is that she wanted it in the next few weeks! Eeeeghads!
I told her that I was bokked until next spring at least and that I could sell her a copy of the plans and materials list to have another contractor build it for her if she could find someone that quick. She immediately responded, "I'm sure the ________ have their plans that I could borrow."
Wrong! I had never provided them with the working drawings or list of materials. I own the copywrite to the design. I had sold the first family the design with 3D presentations and out of scale Jpeg drawings of floorplan to protect my work, and a price estimate to build it. When finished, it was over estimate by seven grand and that was for items changed in progress by the original owners, such as maple flooring instead of carpet.
For another builder to do that job trying to visually copy my work will take more expensive head scratching work than the cost of buying my work from me. There is a unique framing detail that is invisible that could be dangerous to simulate incorrectly.
.
Excellence is its own reward!
If you`re able to specifically charge for estimates, more power to you. In my neck-o-the-woods there`s just far too much competition for the types of jobs I do. I know I wouldn`t be willing to pay someone for an estimate were it requested.
I agree that estimating a job may very well be the most complicated part of the job itself. To be certain my time is compensated for, I pay myself a salary. I personally don`t make any more or any less money on particular jobs regardless of size. Whether I bang out estimates for ten small jobs per week or just two large ones, my pay is the same regardless of whether or not I get the jobs themselves. It`s the cost of doing business and I include it in the pricing of each job I do. Each of my written estimates includes a line item charge of between 20%-30% for overhead and profit. When questioned on such charges I explain that my time without a tool belt on is just as important as when I`m swinging a hammer.
My advice to you is not to get angry at folks who may or not be serious about certain projects that they may or may not decide to hire you for (for a multitude of reasons)....instead be sure that you are charging apropriately for the jobs you`re doing.
J. D. Reynolds
Home Improvements
"DO IT RIGHT, DO IT ONCE"
If you`re able to specifically charge for estimates, more power to you. In my neck-o-the-woods there`s just far too much competition for the types of jobs I do. I know I wouldn`t be willing to pay someone for an estimate were it requested.
JD--
Up until now, I've only applied the charge for estimates (a 3-hour time charge) for 'insurance' jobs; I started doing this years ago because of the high percentage of people who just want me to provide them with a fancy, official-looking piece of paper that they can take to their broker and use to get a check. (And then the HO and the BIL do the job and pocket the money and I'm SOL.) I haven't had any resistance under those circumstances when I explain that I'll deduct the estimate fee from the bill when I finish the job. But the estimate fee must be paid--in cash--before I turn loose that piece of paper.
Now I'm wondering whether I'm gonna cut my own throat if I start applying that to all new prospects. Because you are right--in my area too, the competition is not in line with this idea. Many of the other contractors here feature in large type in their ads, "Estimation Gratuit!" ('Free Estimate').
But what the 'free estimate' ususally consists of is nothing more than a single site visit and a verbal ball-park. I don't have any problem providing that for free. The low-life that caused me to start this thread got that much--but it wasn't enough for him.
"Mr. ________, this job is going to run somewhere between 5 and 7 thousand. It could be more--I really don't think so, but I can't guarantee it. Too many variables in a house this old. Where exactly it falls in that range depends on what we find when we start stripping, of course. The labour rates are thus and such; the materials are plus 5%; and your final bill will be based on the actual hours and materials needed to complete the job."
He wasn't happy with that; he wanted a more precise idea, he said, and I can understand that. So I promised him a more finely calculated written estimate by the end of the day or first thing in the morning. Got his contact info, settled on exactly what work I would include in the estimate, and agreed to price all the materials at his preferred supplier instead of my usual yard (I could see my 5% sailing off into the sunset, but that's not where my profit is, anyway).
I figure that between two site visits, calculating the time, confirming crew availability, pricing the materials at his supplier and entering them into my database, then writing it all up and printing it out, I probably spent a good four hours on it. So by rights, I should charge him a hundred. But, I didn't.... If I had, sure as little green worms he'd have stomped off highly insulted into his cave and left me better off. But that's hindsight.
So here's what I made up for him. Sorry a lot of it's in French, but you'll get the idea anyway. Worth a C-note?
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
For whatever reason, my acrobatic reader is "on the fritz", so I am unable to open your file. My point though, is not whether or not your estimates are worth charging for.....whether they be a single page or a nail by nail breakdown...I agree with you....you should be paid for your time. By paying myself a salary and charging all jobs accordingly, I am guarenteeing myself to be paid for my time on estimates. I base my weekly salary on an eight hour (yeah right) work day in the feild, and three to four hours behind a desk....a twelve hour day. So whether I get the job I estimated or not, the time spent estimating is factored into my fees. J. D. Reynolds
Home Improvements
"DO IT RIGHT, DO IT ONCE"
" I think estimating is the hardest part of the bloody job. Shouldn't I get paid for it, especially if that's all I'm gonna get from some slime ball?"
I think you've got it.
The question of how to actually go about this is far from settled, for me anyway. Sure, this has been discussed all over here, JLC, and coffee shops across the country. I still haven't worked it out, so I'm glad you brought it up again.
It seems like the answer will vary depending upon your business. I like Piffin's thought, but I don't do a lot of T&M anymore.
So far, I think I'm going to start telling people I charge for estimates and refund 50% of that against the final payment if I get the job.
It's a little scary to tell a prospective client you want to be paid for a service that everyone else does for free.
It's almost impossible to get clients (even architects and GCs who should know better) to see what kind of trouble they can get themselves into looking for a "good deal" even though the industry is replete with sad stories.
I don't know how much time I worked without being paid in the past year giving people prices for work I would never see.
I've never minded if another builder beats be by a few percent. That's life. I do mind when someone comes in 25% lower than the two next nearest bids and the client takes it. You know the rest of that story.
I had a guy call me yesterday for a bid on a remodel that we both know he isn't going to give me. He's price-checking a bro deal. I haven't decided yet whether to give him an hourly rate or a lump sum price for the estimate. Or I might just give him some outrageously low number. <G>
If you tell someone you are charging for the estimate and they balk, explain that it takes XX number of hours, and includes a certain amount of design time and professional expertise. Let them explain to you why you shouldn't be paid for that.
It seems reasonable to suppose you (or I) will do fewer estimates. I have yet to figure out if that means we will do less work, or make less money when we add it up at the end of the year.
What it does mean is that we stop giving our life's work away.
DRC
Have you considered raising your hourly rate to compensate you for your overhead - like time spent on administrative tasks like estimating?
These are all very good replies. Charging for an estimate then giving the money back off the bid is not good.
Charging for your time is fair and reasonable wether you do it with a 20%-30% overhead as one said or up front with good explanation to the customer.
I charge for written estimates and spell out that it's cost-plus and explain cost-plus ad nauseam.
Several years ago a customer asked for an estimate for their insurance company. Assurances by this person was clear, I got the job, just help him cover the large $1000.00 deductible. I wrote an estimate for the insurance company and foolishly wrote another to the HO on our agreement less $1000.00. I had not talked to his wife who, when I dropped off the two enveloped bids, said she flat did not like me.
Well, (see it coming?), I got a call a few days later by the insurance agent who was confused. Why had I submitted two bids and why was one so much less. He asked if I had done the obvious and was I aware of the seriousness of insurance fraud.
Fortunately I had actually made the insurance copy a fair bid adding not $1000.00 but I added $1700.00(I wasn't intending to collect this) and the lesser HO copy was dated two weeks earlier. I did this 'cause I suspicioned a potential problem with this HO's request for two bids.
Pointing out that the higher bid is the right one and the HO must simply have submitted an earlier rejected bid. I pointed out the lesser bids scope of work was less as well. The insurance agent said that was a reasonable excuse and agreed to let the HO's to use me.
I called the HO and told him the higher bid is what the job would be and I would not work for a penny less. Our earlier agreement was off.He was upset and said I should not have ever talked to his wife but go ahead with the job.
After talking to my attorney I stepped away from the job and promised myself never to get in those situations again.
It could be that this is one of those questions where the answer varies according to the circumstances. I do kitchens and I start with a rough verbal estimate based on the linear measurements of the cabinetry required. If that estimate is acceptable then I tell them that the job will be in 3 phases- first phase I acquire the material and do a detailed design. They then have to pay for that before phase 2 (construction) starts. Phase 3 is the installation.
It all depends on whether or not it is possible to come up with ballpark figure quickly. Fortunately my competition isn't very competitive and what I offer is different enough to the average to be able to ask more money for.
I don't think it would be possible to charge for estimates in my line of work in my area, I've not heard of any other contractors in this area getting away with it either
John
Have you considered raising your hourly rate to compensate you for your overhead - like time spent on administrative tasks like estimating?
No. I have to raise my rates anyway every year or two just to keep up with the price of eggs (honest to god--that's my inflation barometer; a dozen eggs in the market).
But I have a moral problem with charging Egbert more because Esther is an Esshole.
I know it's done all the time by all sorts of businesses. That doesn't make it the best solution; just the easiest or most practical. Just my opinion (as usual LOL).
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
"No. I have to raise my rates anyway every year or two just to keep up with the price of eggs (honest to god--that's my inflation barometer; a dozen eggs in the market)."
When you started this thread I thought you were talking about changing the way you do part of your business, giving free estimates.
"But I have a moral problem with charging Egbert more because Esther is an Esshole."
Seems to me you could get paid for the time you spend estimating ALL jobs, as well as other administrative tasks, by increasing your hourly rates enough to pay for that time. I don't see how it has anything to do with who's an esshole and who's Mr niceguy.
I guess for me the thing is, any time I spend doing admin tasks, like estimating, or planning advertising, or product research, or tool maintanance, is a necessary part of running my business. That means it's overhead - which I define as "required financial commitment I have to make every year so I can stay in business".
To me, that's the essence of business - making decisions about how to invest the hours I spend working, and what the best way to get a fair return on those hours invested is. That's what I like about being in business, virtually every decision matters.
Free-dumbs just another word for nothin' left to loose........we have too much to loose.time with our families and time to do our work.
Why do appliance repair guys get paid so much for estimates and we don't!?
I have an appliance guy coming here today to look at my fridge...$75 for a five minute look-see...Thats what theyre all getting around here.
Be well
andy
Emptiness is not really empty, emptiness is full of everything.
The "everything", just isn't manifest
http://CLIFFORDRENOVATIONS.COM
Jim,
You've put your finger on a really good point here. Let me see if I can explain why I don't want to factor free estimating into overhead.
Things I consider overhead are things I need to be able to supply services to all my customers: truck, tools, and a home base (da oriffice, all 80 square feet of it!). Under the category of tools, I own and overhead-ize tools to do just about any common job in the building trades--Land clearing, framing & finish carpentry, roofing, painting, plumbing, wiring, gyprocking, tile-setting, stone cutting, light metal work, and cabinet-making. According to the inventory for my insurance broker, tool replacement cost would be about $30G right now. Most contractors here consider me better tooled than the average guy operating at my level.
My policy is that if a job requires a tool I don't own, I buy it and charge it to overhead instead of the particular customer ONLY IF that tool will be useful often for other customers in the future. If not, I rent and charge the rental fee directly to the customer involved, plus my standard 5%. So what I don't own and stick into overhead--where it would inflate prices for all the customers--are things like excavation equipment I might use two or three times a year, concrete forms, large quantities of scaffolding (I own one frame and a set of wheels; this is useful on a wide variety of jobs), jack-hammers, floor sanders, and so on. I don't currently do enough new construction to justify generators and jagger pumps, either, so when I wind up in the woods someplace, I rent.
I think this helps me keep my rates down without starving myself, and enables me to provide good comprehensive service to my customers, no matter what they need.
If I have to factor in the time wasted writing up estimates for doofuses like ding-whack, here, I'd figure to raise the rate by what? 5%? That's $600 smackers on a 12-grand kitchen/bath/basement/whatever. And it's $50 on a thousand-dollar custom door fabrication and installation. Granted, most of my customers wouldn't even notice an extra 50 bucks per thou, but some of them would, and I like them, too. I'd feel like a cheese-heel charging Madame S. an extra $50 for her winter windows because this greasy-haired finagler ran me around the block so he wouldn't have to figure out his materials bill without professional help. Madame S. is a nice lady in her late 50s whose ex hubby split with a danseuse (a topless dancer) and most of the money a few years ago, and she's trying to keep her old summer chalet in decent shape the best her limited means allow. I always do my best for her.
That's what I like about being in business: it enables me to help people out, and keep my own head up at the same time--if I'm careful about how I do things.
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
I state up front: I will charge you X dollars for the estimate, which is deductable from the price of the job if you hire us to do it. This is to avoid using my time, skills, and computer to print out a nice estimate that the guy will take to his broker, get a check for, and then do the job himself or just fix the busted jamb with some silly putty and pocket the money.
As a homeowner, I find this to be very, very fair. Especially since I like detail in my estimates. I understand that it takes time and that is part of what I am paying for. I also take it as a sign that my contractor is careful and serious about the work. Using a detailed written bid, I have been able to go back to a masonry contractor and ask about items that I assumed would have been included. He is a careful guy, took photos and everything to create the bid, but he is very busy and we were in a situation that couldn't be helped here that kept him waiting a bit between his visit and the bid. And the original project expanded during our conversation as I realized that he could deliver a few things I thought I'd have to go somewhere else for. So...we get clear communication up front and I am able to properly budget and stage the project.
I agree with Piffin in that you should never leave drawings or plans with a client. Numbers are fine, but I personally know a few folks who would turn around and use plans with another contractor. (Not friends, but old neighbors) Unfortunately, there seems to be a very grey area around intellectual property. I can't understand it. If the owner wants a plan only, they can buy a book. And I am an HO!
Craziness. I don't understand the psychology around the HO and contractor "dance". If I had time, I'd study it...it would make an interesting article. (I used to study these things as an ethnographer.) Unfortunately, time is money for me too these days :) So off I go to teach!
Just coming at it from a different angle, in what other professions are the clients expected to pay to find out how much the work is going to cost? I think that's the problem most people have with the thought of paying for an estimate--they just aren't used to doing it, so they need to be educated on why it's relevant here.
I'll admit that I'm lucky with what I do that I don't have material costs and that I can multiply $X/sf by the expected sf and be done with it. (But I think I do need a fudge factor for clients who are compulsive versus those who are easy-going. Some people drive ya crazy with their "move the wall over an inch, no back a foot, no 3 inches.")
On design issues like that, I don't allow clients to dictate those details. That is what they hired me for. They can do overall direction like, "yes we like that anteroom to the master bedroom suite" or "no, we don't really need two vanity sinks" or " Alarge mudrom is a necessity" or "we prefer the double hung windows instead of these casememts" But fine detail is my area.
And I let them know that each major revison adds about thirty percent to the design cost. That keeps them from playing puppetmaster with me..
Excellence is its own reward!
I don't want to muck up this interesting thread, so I'll keep it brief. A builder I know uses a designer on conventional houses, and allows the client either 2 or 3 reviews of the plan and that's it. I've not mastered that, nor am sure if I want to or not. I'm thinking. I'd worry that the client would be dissatisfied with the result yet not be able to afford the extra design fee...and therefore be unhappy with what's built.
I exaggerated with the "move it a foot". In actuality, it went more like,
Them: "You drew a rectangular two-person tub, and we prefer triangular"
Me: "They're bigger and won't fit with the shower you prefer in the space...can you accept less space in adjoining room A or B?"
Them: "Hmmm, can you show me what it'd look like?"
{New drawing}
Them: "Well, I like the bigger bath, but the office is now too small. Maybe we don't need as big a porch. How would that look?"
And so on. They aren't jerking me around...just trying to get comfortable with the design in their mind. I hypothesize it leads to less second-guessing later and fewer CCO's, and I worry that if I limit the revisions, that might lead to the client leaving things on the table that they hadn't articulated on time. Do you think my fears here are unfounded?
"in what other professions are the clients expected to pay to find out how much the work is going to cost?"
This Q is usually posed with the presupposition that there is no other but here are a few:
When the govt embarks on a new weapons program, the developement cost are part of the preliminary contract with the production contract being a separate and later thing.
Many auto-body repair shops charge for the estimate when you run into a moose on the road.
When you go to the doctor, an extensive study and series of tests might be needed before you know what the diease is, let alone which of the optioopnal treatments you will want to have.
There are IT consultants who will come into your place of business to make a recommendation of the hardware and software you should have to be most efficient
As a matter of fact, consultant is a new industry branch of many parts of this economy. There are even beauty consultants. You can hire a financial consultant too. Some of them get poaid out of the front end load for securities they sell and others for their time up front. Others are paid based on the amt of money under management.
I know of a road that needed extensive testing before being built. The testing to determine the amt of blasting necessary.
I'm sure there are others but this makes the point that it is not uncommon to pay for preliminary work before beginning a project..
Excellence is its own reward!
"When the govt embarks on a new weapons program, the developement cost are part of the preliminary contract with the production contract being a separate and later thing."
Yes, but there are 1,000's or even 10,000's of man hours into the inital proposal. And those are done "grasious".
"When you go to the doctor, an extensive study and series of tests might be needed before you know what the diease is, let alone which of the optioopnal treatments you will want to have."
Yes, but you can call the office first and find out what an office visit cost. Try doing that with most contractors, asking how much a sq ft cost.
"You can hire a financial consultant too. Some of them get poaid out of the front end load for securities they sell and others for their time up front. Others are paid based on the amt of money under management."
Yes, and a lot of the commissioned based people have the reputation that they are selling the products that give them the most income, not nessecarly what is best for the client.
The real critical thing about this difference between the design work and the "doing work". In the case of the finacail planner, the plan is the design work which actually purchasing the securities is the doing work.
In the case of the doctor there is no design work.
Now from many of your post it appears that you do an excellant job of differentiating between the two.
BUT SO MANY IN THESE DISCUSSIONS DON'T.
How, I disagree with you about the garage/guest house (or whatever it was). Yes you own the copyright on the plans. But you also owe the client a copy of the as-built plans.
must be the full moon.. here's the olde monthly ?
we don't give estimates...
we will prepare a written proposal.. for no fee if i think i'm going to get the job..
but those are the simple jobs.. anything like an addition is going to take 20 to 40 hours..... 100 hrs for for some whole house remodels.. so i will meet with the homeowners... review their plans and then tell them how we do business..
i am going to charge them anywheres from $1000 to $3000 for my work and give them a detailed proposal..
believing that most people i deal with should be smart enough to figure it out.. i do not offer to credit the fee if i win the job....it's ludicrous to think that this money won't find it's way back into the invoice if i give them a credit.. i mean.. i already earned it.. what am i going to do ... unearn it ?
if the job involves design.. i tell them how much the design fee will be, and give them a seperate Design Proposal, which will include a Construction Proposal at the end of the design process...
if they don't want to pay for these services, no problem......no time lost .. on to something else.. even if it's just playing golf.. or mowing the lawn
i would guess that 1/3 of our work involves design /build.. and 1/3 is simple , no fee, Proposal work..
and the remaining 1/3 is either Proposal for a fee, or they swear on their first-born that i will absolutely, positively get the job...Mike Smith Rhode Island : Design / Build / Repair / Restore
No I don't. I agree to design and build a building that met certain pbjectives and that client is happy with the building they recieved. They have no need or desire for a copy of the plans and working drawings to provide one of their freinds with a way to cheat me out of my intellectual property.
However, I have done design for others where I was not to be the builder and sold them the plans as well as my design time and expertise. It depends on the agreement for each job..
Excellence is its own reward!
Sonny Lycos.where are you.he's written volumns on this subject.
a
A soul might say," I dropped by to play at being an ego.....and lo and behold I identified with my ego and forgot I was a soul!"
http://CLIFFORDRENOVATIONS.COM
Andy, I’m not getting sucked into this debate again. I get too much static. I’ll say only one thing. The reason others don’t charge, not for “estimates” but for a SCA - “Specification and cost Analysis” is one word - fear.
I’ll keep doing my own thing, while constantly tweaking it. As you know, I do a lot of work for condo associations as well. They pay me to site visits and investigative time also.
I got tired of being a schmuck years ago. Funny though, it was after arguing with an older brother for years about this issue. His standard statement was: “Are you still doing all of that, jumping through all of their hoops, for not a #$@%&damn dime. Then you’ll still an a**hole!” And he was right!
This one is apples and oranges, Sonny.
Dino couldn't give a roof bid on the spot, then all of a sudden we are into complex design/build jobs. Simple specialties are bid right there, here's your price, and here is my card.
Then you can get into qualifying prospective clients. Do you bid every call on your phone? Why do you go to bid in the first place? This isn't contractor 101 stuff.
Btw, nice to see you back. I hope everything is well with you.
>This Q is usually posed with the presupposition that there is no other
Acknowledged, but not in this case. I was trying to think of some that I've seen, but couldn't come up with anything at the time. Where I'm headed with this is that people accept the familiar more quickly than the unfamiliar. Paid estimated for weapons systems won't help to convince the consumer of construction services of the need for paid estimates, for example.
I've never paid for an auto repair/body estimate. I've never had a doctor charge to tell me what services cost. I never had a lawyer charge to tell me what the costs of incorporating, for example, would be. And once I interviewed 3 financial consultants for how they'd handle a certain sum of money, and each told me their basic approach and fee without any obligation. Maybe I was lucky, but this is just what I'm familiar with.
And that's not a comment that they shouldn't be paid for. Just assessing the environment for it. I talked with a buddy tonight who just left a job to go out on his own as a mason, and we talked through many factors including this thread and pay rates, etc. I can definitely see it from that point of view.
I didn't mean that you were posing that as a challenge, you've seeded some good discussion along this line.
It is hard to compare apples, applesauce and cider here, isn't it?
For instance, with the auto body repair - The insurance companies require three estimates most of the time so if the guy doesn't know you, he figures that he's only got a 33% chance or less of getting the bid so he charges for his time. I've had to pay a few of those, but the local guy who I use never charges me because he knows that he is going to be doin my work.
Doctor may not charge to tell you the standard fee for a certain procedure out of his flat rate book, but he does need to charge for tests to know if that procedure is the one that's needed - or send you to another guy for that test - and another one to read and interpret the results - so you can end up with plenty of up front cost before the work begins.
I just incorporated a few weeks ago. Asked right up front the lawyers fee for doing it and associated advice. He was equally right up front with his price because he'd done it before with outfits just like mine.
So again, it depends on the complexity. I never had to charge for estimating a roof or a tile job. I'm pretty sure luvditch can price out a floor if it is pretty standard, but I bet he or woods stops to think about it for a few minutes to estimate an inlaid pattern.
I liked Mike's line, I earned it, I'm not gonna unearn it am I .
Excellence is its own reward!
And I'll bet each of those in your post came to "your" house to discuss your problem. Do this: Call three CPAs, ask them to come to your home some evening or week-end, pick up your tax paper work, go back to their offices, calculate your tax liabiity or refund and then return too your home - again - and present you with a Proposal - for free - and from each one. Then tell them that you will award your "project" to which ever does the best selling job to you and with the best price based upon "specs" that of course, they will also determine after asking you a few questions.
The key is that the pubic buys "remodeling/repairs" as they buy "products". Big mistake. But they forget, or don't realize, that the products already have their "quality" built in. All that's left is to negotiate a price and schedule delivery. Would anyone in his right mind chisel on price for other "professional" services such as that same CPA, doctor, attorney, or stock broker. I doubt it since the "services" to be performed are merely "promises to perform." As such, the caliber of those same services are to a large degree based upon the amount one pays for them.
This week while explaining the above to a potential customer, but in more detail, I finally concluded by saying that the last time I looked steak was still more costly than ground round, and the "services" provided by MacDonalds was still considerably less costly than that of a family style reataurant - for very similar food & drinks. A cup of coffee at MacDonalds for $1.00 verses that same cup at $2.50 (a 250% premium) at Star Bucks. The differences are in the "experience."
That "experience" is what must be sold. If not, all they have been give to base their decision upon is price. Bottom line is to buy "their" price, or sell "yours.'
A key to gettting paid for all of the services we do and for which we should be paid, is in "The Experience Economy" - excellent, excellent , book.
Pif, I know you well enough to know you didn't mean me...
Pif and Steve, I don't have a body shop, and when I've needed one, I walked in cold and got the estimate I needed and I've never been charged for that. Don't know if that's right, wrong, or indifferent....just that it is what happened maybe 5 different times in my life. Like I said, maybe I was lucky.
Sonny, your CPA example isn't appropriate, be/c neither I, nor anyone I know, would ask even one to calculate tax liability for free. When I met with the financial analysts, I went to the office for two and the third preferred to come to my house. Spent about an hour with each and told them my story and the monies I was seeking management services for and asked what they could do for me and what it would cost me. From my perspective, I was giving them the chance to sell themselves to me...to explain their philosophy of money management...to give me some reason to select them over the other possibilities. None requested a fee for that meeting. They thanked me for the opportunity. I thanked them for explaining their philosophy and approach. I selected one, and never thought about it again till today.
Don't take that lil' story as an argument in favor of no-cost estimates. It's simply a recollection of history. As a homeowner, I'm hard-pressed to imagine a case where I'm going to pay someone to tell me how much it will cost to use their services. At the same time, I won't squeeze someone for free info and then use someone else to implement it. Where I live, it's just not the MO to pay someone to tell you what their services will cost. For that to change, clients will need to be convinced to follow a different model than they currently do. That's not me making it up or justifying it...just telling ya what I see when I look around.
For my design work now, I likewise cannot imagine telling the prospective client that I will be submitting a bill to them for the time it takes them to decide if they want to work with me or not. I guess I consider that time to be "marketing." We talk about domes, about them, about their property, about building stuff...I'm trying to get them comfortable enough to share some of their hard-earned money with me, but at the same time I don't give them details or ideas they can use with someone else. And I certainly won't produce any design for them without their commitment (i.e. deposit). I won't suggest this can apply to contracting, be/c I don't know that business. My only real point is that clients come with many different perspectives, and usually not with the perspective of what it's like to be a contractor. For prospective clients to begin paying for things they've historically received sans invoice, i.e., an estimate, some amount of education will need to happen to convince them that the circumstances are now different.
A final story with a different lesson. HVAC buddy did an estimate for a client of mine. Hours figuring the loads and sizing equipment. Submitted a number. Client also spoke to someone else who gave a different number. My friend's number was twice the other number. But to explain himself and justify the $$$, he would have had to disclose the design parameters, etc, and client _could_ have used that info to shop around. In the end, he didn't give the details, and client wasn't comfy with the lack of justification for the projected $$$, and so has looked elsewhere. No one was happy. I don't know the right approach here, but I do know that I don't like my friend's model, and I'm glad that my corner of the business world works a bit differently than that.
"As a homeowner, I'm hard-pressed to imagine a case where I'm going to pay someone to tell me how much it will cost to use their services."
And the problem in our industry is that contractors have been trained, and worse yet, trained themsleves, to believe that those "how much it will cost" you mentioned are not really "services".
To me, they are no less the services of an attorney (as in obtaining all of the info needed to prepare for a case iincludiing depositons), an engineer or architect.
"How much will it cost" to create and build my prototype car? Not actually build it. Just to cost it out. "Ahhhh, nothin."
Yea, right! As the editor of one of our magazines stated in the magazine article a couple of years ago: "the public has been getting a deal from us for years.
Know how much car dealers mark up parts? 400%. But then again, ever hear of a car dealership going broke? And their customers are the same customers of ours who, when finding our that we mark up our parts 25% are shocked.
Anyway, I'll stay the dummy and keep getting paid for my time and expertise. All of it.
>And the problem in our industry is that contractors have been trained, and worse yet, trained themsleves, to believe that those "how much it will cost" you mentioned are not really "services".
I don't argue that. What I'm wondering is how they're gonna train themselves according to a new model. And how they're gonna train the consumer to accept it.
You do acknowledge that I'm not making a case for no-cost estimating, right? I'm just trying to see how people can transition from one model to another.
>Anyway, I'll stay the dummy and keep getting paid for my time and expertise. All of it.
You don't need to word it like that, be/c it's great that you're successful at it. Do you get most of your business word of mouth/referrals? I'm guessing that that makes your approach to estimates a whole lot easier to implement, be/c you start the relationship with an advantage that your competitors don't have--i.e., the prospect knows that you've done this successfully for someone they know and trust. I think most people are in the market for a successfully-completed job, rather than a specific price, and be/c of the quality of the referrals, you've associated yourself with "successfully-completed jobs". Just a guess. Also just a guess that a new contractor, or one coming without such strong referrals, would have a more difficult time implementing your practices, be/c on what basis would someone agree to pay them before they've actually hired them?
I'd like your opinion on something from today. Just got a job in my own favorite way, which is referrals from builders. Client asks builder if there's someone they like using for design. He said they like working with me. Client asks if I'm available to work for her and what do I charge. Now, I know she's not gonna be shopping this around, and even if she does, I have the backing of the builder. That's as easy as it gets. Question is, should I be charging her specifically for the time to write the email or make the phone call to explain my rates and offer up a sample (a pretty rendering of a recent design) of the kind of things I'd be creating for her?
"The differences are in the "experience."
That "experience" is what must be sold. If not, all they have been give to base their decision upon is price. Bottom line is to buy "their" price, or sell "yours.'
A key to gettting paid for all of the services we do and for which we should be paid, is in "The Experience Economy" - excellent, excellent , book."
Brilliant stuff, Sonny, and it could do with repeating. I think it's probably what a lot of us do anyway, maybe without realising. I will certainly keep it in the front of my mind when I'm negotiating with potential clients.
Thanks
John
btw, where is the JLC forum referred to earlier? and are there any others I should be looking at (I make and fit kitchens)
Taunton Press has competition in this part of the industry from the Journal of Light Construction at
http://www.jlconline.com/cgi-bin/jlconline.filereader?3cf26bc400627a59271a401e1d29064e+EN/userpages/34
.
Excellence is its own reward!
Well I’ve read this thing and each time I come back to post it's bigger. . . It seems that everyone has a position to speak from and in retrospect everyone has a point. I seem to line up with Bob, Kermit and Sonny. I found out might early on that this “free estimate” crap was for the next guy and not me.
The first year in business I spent more time in estimates and gas then I was making on some jobs because just like everyone I was stupid enough to put those deadly words in my advertisements “Free Estimates” what a bozo. . .
Nowadays things are much different. Gone are the free any things and in are the pay for every things. Why not, I pay for every thing I get. . . Like I said after a year I came up with the new plan. Free consultations. I can now spend 5 minutes of my time with a prospective client and know up front whether it’s real or a fishing expedition. Since I do kitchens and cabinetry I can have a feel for the job very early on. By 15 minutes in I have a base price in my head and I can say I’ll call you in a day or two with a base price. If you are comfortable with the price you can give me a design fee to design and cost the entire project out. If you're not comfortable, good luck.
Since 90% of my work is now word of mouth and price is a very small issue most of the time. People who call me have a fair idea of what my rates are and they just would like for me to build their kitchen or cabinetry. The simple truth is that if someone calls and asks for a free estimate I tell them I can give them a free consultations and if they’d like one, their more then welcome to one. That consultation will be over in 15 minutes if it’s an expedition. . . .
That 15 minutes is my "cost of doing business”. . .View Image
And I line up in complete agreement with you. I chat on the phone just enough to see if they're serious or not. The more I do this, the better I get at assessing them. If they start asking too detailed questions, I give answers such as, "well, you could go with shape X or shape Y, but there's no way to tell till I've reviewed your site. How soon can you get me a survey and pictures?" And I make it clear that I won't do specific design work without a retainer. And I discuss my fees and payment schedule.
After following this thread, I don't know if all that stuff, for which I do not specifically charge, counts as a bid, estimate, free consultation, marketing, or what. I think my personal goal though, is similar to many of y'alls--to shorten the time between the first introduction to a prospective client, and the passing of money from their hand to mine.
Now your firing on all cylinders.
About “time” of hours spend in the business.
Theoretical:
Person spends 60 hours per week in his/her business.
Same person spends 40 hours per week doing what most would call field production work. It’s really less, but I wouldn’t argue. After at least 3 weeks of vacation, which we all deserve, vacation, holidays, sick days, etc., that comes to 46 weeks per year.
S/he wants to take a salary of $2000/week.
$2000/wk x 52 wks = 104,000. (anything less is a joke)
42 wks x 40hrs/wk = 1680 annual field production work.
$104,000.00 divided by 1680 hrs = $62.00/hr (roughly)
That $62.00 doesn’t include other perks, taxes, overhead. It ONLY Includes salary, vacation, sick pay & holiday pay.
From the above, if anyone cannot figure out what to charge for their labor, or what markup to use, they shouldn't be in business - ANY business.
Well, I’ve reread all of the posts and have a couple more comments as a reply so some of the comments made here:
1. "Estimating" is NOT an administrative task. It's a "sales" dept. task.
2. Detailed Proposals, not “estimates”, are not, I repeat NOT - and entitlement for the public. Free “estimates” such as between $25K and 32K should be free since they are an estimate, equated with a “ball park”, and take an experienced person only a few minutes, as has been stated here before.
3. Anyone who does charge for detailed Proposals is definitely in the minority. So what? Contractors who don’t know how to price jobs, get burn out and go broke are the majority - 85% of us within the first 5 years of business. Should I be one of them, just to be in the majority?
4. Buying a car is buying a commodity, no different than buying a shirt, TV, refrigerator - all commodities, or “goods”, and as opposed to apples, bananas, lettuce, or remodeling or repairs. Remodeling and repairs are buying “services”, not to be confused with “goods.”
5. "Respect is a 2-way street." Yes it is. Does that mean that I should go to someone’s home, talk to them and get photos, dimensions, etc., back to my office, call subs where needed for their prices, calculate a Proposal, type it up, go back to their home to present it - maybe a total of 6-8 hours - FOR FREE? Is that How I show “respect” for them or is that how I show I’m a moron?
6. Cloud said: "A builder I know uses a designer on conventional houses, and allows the client either 2 or 3 reviews of the plan and that's it."
Personally, I don’t think that’s right, especially since most people are not designers or decorators. Consequently, if they want to make 40 changes, so be it, BUT - they will pay for each and every change. Again, time is money - mine.
Finally, I think it was Piffin who alluded to the fact that we do build prototypes. By their very nature, they are very demanding of our time during the assemblage of information, changes in our mind and on paper, consulting with subs, etc. What designing, costing, and building of prototypes is NOT - is walking into Circuit City and looking at all of the different TVs, sizes, options, etc. Ditto for cars, clothing, appliances, etc.
I respect each customer’s time, money, ideas, concerns, likes and dislikes. All I expect from them is to “respect” my time, or rather, it’s value.
Expertise in product knowledge, designing, costing, planning and managing, combined, are worth ten times the production end. Yet the public still thinks that only when we have a hammer or paint brush in our hands, do we represent any value to them. And the fault for that belongs to us - not them.
BTW, a few days ago, I heard on the radio that either nationally, or for a specific state, lawyers are now allowed to charge for time while "thinking" about a case. Think about that, the next time you're to embarrased to ask to get paid for time spent creating a Proposal, yours and your customer's friendly lawyer is getting paid (from your pocket) while he's sitting on a toilet, standing in front of a urinal, swinging a golf club or if Monica is doing a number on "his" club. (-:
Edited 9/6/2003 1:24:11 AM ET by Sonny Lykos
Hear hear.
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
>6. Cloud said: "A builder I know uses a designer on conventional houses, and allows the client either 2 or 3 reviews of the plan and that's it."
>Personally, I don’t think that’s right, especially since most people are not designers or decorators. Consequently, if they want to make 40 changes, so be it, BUT - they will pay for each and every change. Again, time is money - mine.
In a post you can't include every caveat all the time without getting too voluminous. It really is 2 or 3 reviews before an additional fee applies, so you're both thinking the same way. I am personally still trying to figure this out. I charge by the square foot. I'm still learning how to set this price so that the hours invested will equate to the right salary. Or how to control my interaction with the client toward the same goal.
> Detailed Proposals, not “estimates”, are not, I repeat NOT - and entitlement for the public. Free “estimates” such as between $25K and 32K should be free since they are an estimate, equated with a “ball park”, and take an experienced person only a few minutes, as has been stated here before.
I found this enlightening. Even if it has been stated before, there's enough confusion in the use of words that when I use "estimate" or "bid", you or dino or I could be meaning different things by that.
Does the following question have an answer: What's the most time you will spend with a prospective client before billing them? (That covers the initial "Hi, I'm Joe. I need work done. Do you do this kind of work?")
Yester day, I got a contractor to give me a bid on replacing a septic tank. he was here 15 minutes.
If we were talking about a whole house remodel, I would have expected several hours before we agreed on developing a proposal.
The septic contractor gambled 15 mins on earning a few $100's. The remodeler would be gambling several hours on earning many $1000's.
If you gamble 1 hour/$1000 possible income, and your rate is $100/hour, your betting at 10:1 odds. If your closing ratio is better than %10, you win.
The better you get at discerning looky-loos and selling yourself, the more you win.
SamT
The reason this issue comes up so often is due to the frustrations of the way the public generally treats contractors.
I wouldn't spend more than about an hour with them. I ask a lot of questions over the phone to qualify, clarify and familiarize them with me and how I operate and then I get them familiarized with me and their priorities. I also get an idea of their personalities.
Last week I met with a women, daughter and son-in-law. Teri, the Mother just bought about a $300K condo on the Gulf of Mexico, and she had an extensive list of things she wanted done. They lived Miami and were leaving the next day to return. I offered suggestions, ball bark prices in certain items and after about 1/2 hour “we” decided on a general scope of work. It took me about another 20 minutes to come up with roughly between $25K and $30K for the work.
She said that was about what she thought (she’s a realtor so familiar with basic prices). She said she usually represent people selling higher end real estate. I said I needed to create a detailed scale drawing of the condo and my fee for that and creating the detailed SCA would be between $400 - $500, which she agreed and gave me a check for $450.
Since I got here in Mich. two days ago, we’ve been emailing to clarify things, and discuss options we’ve both come up with. She got my name from my cabinet guy in Home Depot who got fed up with the problems he’s incurred with the installer his store has been using and recommend me often, telling people I'm not cheap, but if they want things done right and to work wit someone who will accommodate them where ever possible, I was the guy to call.
In most of my posts or discussion, I've continually tried to get the point across that the #1 priority of any contractor, be him/her a GC, remodeler/repairman or sub, is to get their name/business to the point that “THEY’ as opposed to their competitors, are in demand, and continually. “Branding”, and consciously continually coming up with ways to improve it weekly, or with each new customer. Only with that type of reputation, will people be open to what I consider to be a normal and fair fee schedule. When in demand, price becomes a moot issue. In the last week before I left Naples, I had two people call me to inquire if I would “consider’ doing there project. When I get calls like that I can’t get thru my office doorway due to the increased size of m head, but then I realize that during the 13 ears I’ve been in Naples, that type of call is “exactly” what I’ve been working my rear end off for each day of those 13 years. Of course, the flip side is that on a daily, even hourly, basis, I have to prove and produce what, in their “perception”, warrants my reputation. Not easy, but doable.
Of course, it helps that I really like people and “naturally” bend over backwards and jump thru “self made” hoops to WOW my customers.
Selling, PR, and continually marketing on the job trumps the technical & production aspect of any remodeling project. Example in real life: How many times have we gone out for dinner where the food was just so-so, or even slightly disappointing, yet we raved about the place, or specifically the waiter or waitress, because that person alone made the dinner out a terrific “experience.”
Screw the food. I love the attention, appreciation, and being treated like I’m really important, and by a professional wait staff member. And if s/he has a great sense of humor, WOW - that’s a plus! Like I said, that food suddenly becomes an after thought, as it should be because I can make food at home. We really wanted an enjoyable “experience” for our evening out.
Your first coupla paras explained a lot, and there's not much gap at all in what we believe. You do spend maybe 15 min, or maybe up to an hour assessing the situation without handing over a bill for that time. But then you put a price on any specific work for the client. I understand that and do the same. Just spoke with one this morning. Had spent maybe an hour on the phone prior to this and exchanged a coupla emails explaining my billing practices and how I work. He's thinking of buying a lot that may or may not be buildable. I told him I won't design anything until he has a lot and I have a retainer. But in this case he needs a feasibility study for signoff by the county and health dept. We agreed on a price for that, and have a meeting of the minds.
I've kept posing questions to you be/c I thought you might be saying that that first 15 min or hour's conversation should be paid for, and I couldn't see how to make that happen. Thanks for following up.
Nah. I realize that people are people, just like you and I. Mostly they don't have a good idea of what they want other than just generally.
So teh time spent during the first sales call is a freebie, but a freebie that covers a lot. Once they realize what's invoved "from my end", they begin to understand all of the time involved.
Sure, I still get the occasional "You want to charge me?" But after all the explaining I just did prior to that stupid comment, I'm tactfully gone.
So I may spend 2-4 hours per week on the above tupe of people - not much considering the flip side - the tremendous time I save of what it could have cost me.
Ahhhhh, to recapture all of those years it "did" cost me big time, but that was when I was a moron. The experience of life is one heck of a university!
Cloud
I use the terms Estimation, Soumission, and Prix Fixe in French, most often--but:
An Estimate is a written document that specifies:
what work will be done,
what methods will be used to do it,
what materials/subs will be used and their itemized cost at date of writing
how many man-hours per carp/apprentice/helper I THINK it will take to finish the work specified.
The bottom line on the estimate IS NOT GUARANTEED, not even to within any particular percent. I do promise that if it looks like we're going to go more than 10% over, I'll notify them as soon as I know that, and tell them why. The HOURLY RATES and the MATERIALS MARK-UP are guaranteed for 90 days. (Materials prices themselves are not guaranteed because my supplier can raise his prices and I'm not gonna eat the difference.)
A Bid is a per unit price given in writing, specifying how much I will charge to complete a specific, measurable unit of work (square foot, whatever), all materials included, and also what the work, materials, methods, etc., are to be for that per unit price. This is usually for a job where the exact amount of work is unknown at the time of the call for bids. I don't bid. Or rarely.
A Quote is a flat price for a total job. The work, methods, materials, etc., are all specified, as are the terms that govern it (change orders in writing; substitution of materials in the event of back-order, whatever). I don't give quotes except on units I fabricate in my shop from my own designs: custom doors and windows, cabinet doors, carcases, and so forth. There is always a design fee specified as part of the quote. And installation is always extra--estimated.
A Ballpark is verbal and usually has a range built in of anywhere from 30-40%: Sir, a job like this usually runs between 5 and 7 thousand. I don't have any problem giving that away for free--It's worth more than nothing (my experience, after all) but it costs me only the drive out and a fast look-see to produce.
For me to produce an Estimate--which I have decided as a result of this thread I will no longer do for free--means I've got to make at least a rough sketch of the place and do a complete bill of materials. Now that I finally computerized, at least I don't have to copy it all over neatly by hand; I can shove it through my data base and only have to verify with my supplier for item X that he hasn't changed his price since I last updated it.
As I said earlier (I think), I seldom if ever get asked for an estimate by regular customers; it's like with Sonny--they want me, and they don't worry that I'll over-charge them, they just want an idea of what they're getting into before giving a final ok. It's the new prospects that are problematic. If they're not coming to me from a customer referral, they may only be calling me because mine is the nicest-looking card they saw on the rack at the lumber yard. Or I might be the 7th guy they called with the same story. I have no way of knowing.
But after reading everybody's input in this post, and thinking about things at length, I've realized something: I've almost never been asked for a 'written' estimate after having given a ballpark figure--and then gotten the job afterwards. (Unless I charged him for the Estimate--insurance jobs, like I said. Most of those I get.)
This tells me one of two things: Either my estimating is way to high (it's not; I have to do the same work to start a job once I've been given it based on a ballpark, and the figures come out pretty close), or THE VERY ACT OF SOMEBODY ASKING FOR A WRITTEN ESTIMATE ON A $2k-$10K JOB SHOULD BE A RED FLAG TO ME THAT THEY'RE NOT SERIOUS, AND ARE JUST 'TIRE KICKING'.
So--NO MORE FREE ESTIMATES, DAMMIT! I'm through being a sucker. Thanks, Cloud, Sonny, Piff, et al. I'm a free man at last! (Uhh, is that what I really wanted to say??LOL!) It works better in French: Plus de maudites estimations gratuites! Je suis un homme libre enfin!
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
Dinosaur, you may - nah - WILL - lose a potential job now and there, but in French, English or Swahili (sp?) you've just taken control over your life again.
Good for us!
All of my remodels are fixed price, and is why I refer to an estimate as a ball park - as opposed to a FP. Although I do a fair amount of jobs where my SCA will state that the final cost will be between $2500 - $3000 for example, based on the specs on the SCA and with no changes or hidden issues. I explain that to the customer and that if they want an exact price, to cover myself I'd have to go with the $3000 due to some minor possible variances. I say that my idea of the min. and max. seems more fair to me and they usually agree, due to the impossibility of assigning an exact number of minutes to each of the many "operations" needed to be done. I then do the job in a T&M basis for pricing and when done just invoice them with the final price - no break down.
To coin an often used phrase: We're on the same page.
Ouais--nous sommes sur la même voie! (Don't know how to say that in Swahili, tho LOL!!)
You're absolutely right: the honest customers understand when I explain to them that for a fixed price, I have to bump things up to cover my can--and that they'll be better off letting me do it my way (T&M) 90% of the time (and I gotta work on the 10% to get it down; each year I get better, happily.)
What's really great about having the tire-kickers get mad and toss me out is that they'll tell all their friends what a creep I am, so none of their friends will ever call me. Think of all the wasted time I'll save not having to deal with them, either....
Sonny--close to thirty years ago I read a book, a very ordinary, not-badly-written, coming-of-age novel entitled "Chocolate Days and Popsicle Weeks". I forget the author's name. But I remember one line in there like I read it yesterday. The main character had gotten himself a job in an ad agency, and had a face down with one of the senior shirts soon after he started. He walked into the shirt's office and very calmly stated that he'd not appreciated the way the shirt had chain-of-command blind-sided him on something or other. The shirt tried to sluff him off by acting like a, well, shirt. Our hero reaches across the desk and grabbs the shirt's shirt in both hands and half yanks him out of his chair, stating that the next time it happened, he, the hero, would personally physically kick the sh!t out of the shirt. The shirt squealed that he'd call the police. The hero says, not fast enough, shirley, and dropps him back into his chair and walkks calmly back to his own office.
No repercussions. He gets away with it clean. The shirt is too embarrassed to make a stink. Also, he can't quite believe it happened.
On the way home, our hero is thinking to himself in the subway. 'You know,' he thinks, 'it's true: Build a better Fock-You Attitude, and the world will beat a path to your door.'
Over the course of the last 30 years, I have translated this into meaning that if they know you care, you're at their mercy. If they think you don't give a whack, they figure you must be sh!t hot to get away with it, and maybe they'd better play it your way. This works in relationships, jobs, pretty much anywhere. Sad, but true. I suppose, like you, that I'll lose a job or two by refusing to jump through their hoops. But, firstly, they would probably not be jobs I'd enjoy doing, and secondly if I really don't care, I might get them anyway, whether I want to or not. (Hmmm--I think I just bit my own tail with that argument. WTF.)
I don't like wearing my FU attitude; mostly I keep it on a coat hook near the door in case of need. If I wear it all the time it gets scratchy and smelly and nobody'll come near me. But: when it's raining, I put on a rain coat....
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
"I don't like wearing my FU attitude; mostly I keep it on a coat hook near the door in case of need. If I wear it all the time it gets scratchy and smelly and nobody'll come near me. But: when it's raining, I put on a rain coat.... "
My way of thinking. As Rhett said in "Gone with the Wind":
"Franklly my dear. I don't give a damn!"
Sometimes, a little arrogance is good.
Try this.
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
I love it !!!
I'm gonna print it and the next time Barb says: "You know, sometimes you act like a damn kid!" I'm gonna get it out and stick it on the frig.
Originally stolen from BT--I forget who first posted it--now returned to BT. I think it's a Sendak. Somebody correct me??
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
I totally agree. This is something I have started doing myself. Not the scene from the shirt's office, but just being a bit more assertive about what I do and don't do. For instance, at the moment I only do one design of frame and panel door. Last customer I saw, as I was bringing the sample door out I said, "bad news, only one door design, good news is, it's a great design". She saw it and loved it. The main thing though was my attitude when I was saying it was the only design. What I used to do was to let clients set the agenda, make their requests and then I'd stand there thinking about how I could do this tackle this different stuff, I think they would pick up on my indecision and then the game would be lost.
John
hope this isn't too far out of the ballpark for an aside, but how in the world do you charge for designs by the square foot when you design in round feet?
;o).
Excellence is its own reward!
Yeah--and a 'Ballpark' is usually a Diamond, isn't it?
(Hee, hee, hee, hee)
à.."(:>~<:)Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
I'm wondering if square feet make it harder for clients to walk...
I think doing something you don't care about, just to make money, is prostitution. If I don't care about wether I get the job or not, I don't invest any of my precious life trying to get it by acting like I don't care wether I do. You guys lost me on that one.
To each his own. But I have to say, if someone isn't interested in what they are doing, or gives me the impression they don't care, I interact with them only when I need to. To me, that's one of the least desirable traits a person can carry - that they "don't care".
Maybe I am misreading what you guys are saying. I sure hope so.
"
I think doing something you don't care about, just to make money, is prostitution. If I don't care about wether I get the job or not, I don't invest any of my precious life trying to get it by acting like I don't care wether I do. You guys lost me on that one.
To each his own. But I have to say, if someone isn't interested in what they are doing, or gives me the impression they don't care, I interact with them only when I need to. To me, that's one of the least desirable traits a person can carry - that they "don't care".
I don't think that's quite what the guys mean, Jim, although I can see how it would read that way. I think perhaps a better way of putting it is that if you go in with a confident attitude and make it clear that you are not desperate for the job then you have a much better chance of getting it because customers can sense your confidence.
It's very similar to when one is young and wants to ask girls out for a date. Act like you are desperate and you've got no chance. They can smell your fear.
I've been trying to cultivate a more positive attitude myself, and it seems to be working. I act like I want the job and I respect the potential client, but I try to project the attitude that if they don't say yes today then that's ok, maybe it will be a month or so before they get back to me so I don't mind either way
John
Not true, Jim. I used to do a lot of paper hanging, which I hated, but did it because it was either part of a job or for a regular customer.
Besides, the very fact that I take MY time to go to a strange’s home, should be an indication that I am interested in the job. I’m also interested in a lot of other things, but not a a 20% increase, and as for job, not at a 20% decrease. Besides, from my past posts, you know me better than that.
I also used to enjoy pouring concrete for sidewalks or changing damaged aluminum faica. Since I no longer want to swing a sledge hammer to bust up the old walk, or carry a 36’ ext. ladder around the back of a 3 story condo, I don’t. Does that make me arrogant?
On the other hand,I use a Variable Pricing Structure (VPS) and employ a 60% up charge for doing some things that I have a talent for, and is unusual here, yet part of a job.
Of course, I guess some could say that anyone who sells his/her “services” for money, and whether they enjoy it or not, is prostitute.
As a “business” man, I employ good “business” policies.
When younger, I tolerated things and people I disliked, but as I age, I find tolerating them less possible. That includes stupid and ignorant people. In America, there is no reason for either one to exist.
"When younger, I tolerated things and people I disliked, but as I age, I find tolerating them less possible".
The very point I was making with my dislike for sales. I don't like to do it, but I do. DanT
Dan, the difference is that I still do things I don’t like to do that are the basics of my business. Hell, I even get up at 7AM, which I not only dislike, but “hate.”
I don’t work for or bother with some people simply because I no longer need to put up with such people. And "not" doing their jobs does not diminish my annual income. However, I do still need to get up in the morning.
I understand what you are saying. But you don't seem to look at what I said in the same light. I said earlier that I did not like sales and one of my goals was to get big enough to hire a sales person. You went into a mini lecture about how just because I didn't like it didn't matter but I should work to be really good at it and then I would enjoy it. I am saying I am working at it but I don't enjoy it. And I think that is ok. You seem to infer it is not ok. But I think its ok for you to not like getting up at 7AM even though I get up every day at 6. So I guess my question is why is it not ok for me to hate sales, even though I am working at it?
My original post was simply to point out we all don't share the same strengths and weaknesses. I felt you chastised me for feeling that way as though I somehow was wrong. I feel I am correct in assesing my strengths and weaknesses and planning accordingly. DanT
Sorry Dan . You're right. I misundersood what you said. I'm reading quickly using my laptop while sitting on my bed in my daughters home with only one line, so I have to get on the Web and off, fast. It will be nice to geet back home to my office and DSL. In fact, I also think your smart in getting your business to the point where you can hire a sales person.
Again, I apologize for the tone of my last post.
Maybe I am misreading what you guys are saying. I sure hope so.
I think you are, Jim.
I think it comes down to that old law of 'supply and demand.'
What I'm saying--or trying to, anyway--is that it always seems easier to maintain control of the 'negotiation' if the other party doesn't sense that you're 'hungry'. As soon as they smell your need or desire, your bargaining position becomes distinctly second best.
I've always noticed, for instance, that a guy who's single and looking broadcasts a kind of 'hungry' aura that just seems to chase women away before he can get within hailing distance. But a happily attached, contented guy who's not looking seems to have swarms of hungry dames sniffing after him pretty much any time he ventures out in public.
The same thing applies to trying to find a job--whether it be employment with a company, or trying to find a contract for your own outfit. It's when you're overloaded or at least fully booked that the phone seems to ring the most, and when you tell people you just can't, that's when they beg the hardest. But if you get on the phone and call all your old customers during a slack, trying to raise some work, you'll be lucky if 95% of the messages you leave don't just drop down the Black Hole of Voice-Mail....
The guy that answers a help-wanted ad or goes to an employment agency is not going to get the same deal as the guy who's already employed and is approached from the outside to change jobs. In the executive world, they call it being 'headhunted' and that's where those 6- and 7-figure salaries come from.
Anyway--I most certainly do not ever want to give anyone the impression that I don't care about my work; I do, I like it, and I do it by choice, not because I can't do anything else. But not being desperate for a job (or managing to appear so) is a much better position to be in when you're trying to sell something, especially when it's you.
You always want the customer to be hungry for you. Not the other way around.
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
Edited 9/8/2003 12:04:57 AM ET by Dinosaur
Yeah, that sure reads better than what you said about wearing that coat you keep handy.
Still, my experience has been that honesty is the best policy. When I'm happy, it shows. When I'm mad, I blows. Certainly not what you'd try to teach your kids, but it's honest. And if if offends someone to the point it damages the relationship, then I guess that defines the critical point were the relationship is either strengthened or damaged. So be it. I've never been interested in role playing or make believe.
When I want any particular job, I go after it, and make no bones about the fact that I really want the job. The few times that has happened over the years, I've either gotten the job, or the customer has called me later to look at another job or to tell me they regretted not using me the first time.
I'm not giving any advice here, just telling what I've done and how it has worked for me. Like I said earlier "different strokes for different folks", and the fact that other people have different opinions and experiences is what makes for interesting exchanges like this one.
If something works for you, steady on. We're all learning, every day.
Ideally, we never appear 'hungry' because we aren't. Being able to pick and choose for whom we work is the ultimate luxury in this vale of tears.
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
This morning I went to see a lady about a sextagon gazebo for a hot tub.
12' gazebo.
9x10' hot tub.
Women shows me a picture of what she wants from some magazine complete with material list. Heart Redwood and shake roof construction.
The article says that the gazebo should cost approximatily 800$.
Her line of thinking is a 10' tub will fit in a 12' space. She can have the gazebo w/ electric and site prep for 800$. The article says so.
She got pissed at me when I tried to explain to her about a square peg in a round hole. You'd think I stuck her with cattle prod. I also recomended that she take the price list to a Big Box and price out the material. More hysteria. The artcle wouldnt lie to her. So now I'm price goughing and yadda yadda yadda. Never discussed price other than I couldn't do it for that amount of money and said that it must have been a miss print.
Dino... Who gets the bill for 4-1/2 hours? Gonna have to be the next paying customer because a work up isn't in her budget.
Who ever invented work didn't know how to fish....
Along with IMERC's question, I have one, too. I do a design and make it all nice and neat. Now it's the presumed builder's turn to price it out. Likely he'll get the job if he can find a common ground with the client, be/c they aren't bidding it out to other builders...just this guy. So, should his time to prepare a fixed price bid for turnkey new residential construction be rolled into the cost of the construction or be separately billed up front. Normally it wouldn't matter...same dollars from same client to same builder. But there has been the case or two where something went wrong (client circumstances changed, or price too high, or ...) and the house never got started. So, should the bid preparation be billed separately or part of the overall price?
Just going to ask another related question, assuming you make up the price list, materials and what ever other preperation needed, and you charge, does that information become the property of the proposed HO.
I'd say so, but could that get into trouble with them then shopping you around?
Never be afraid to try something new. Remember, amateurs built the ark, Professionals built the Titanic.
R & D, or Design, or Specifications & Cost Analysis (SCA).
Pick any one or all of the above - and should have been charged to the builder, who in turn charged it to the client.
"Mr. Smith, I can have a specialist and designer, draw up a plan and cost out it's material and assembly for you for about $300 - (or whatever)."
It's time the philanthropy stopped. Or we can all change out company names to "Joe's Construction and Philanthropy" and continue this farce.
Sonny, my time is already covered by the client. My question is, should the builder include _his_ cost to prepare the bid within the construction price, or bill it separately, or doesn't matter?
I don't think it matters since we don't know his exact relationship with his customer. My only concern is that you get/got paid for your time.
For example, I get a fair amount of calls from one particular GC whose specialty is large remodels - both condos and houses. He uses me for 1) mold inspections and remedation and also 2) locating and correcting moisture or water leaks - my specialty. I'm treated as a sub so it doesn't matter how or if the GC gets paid, or if he marks up my charge. He does pay me quickly, which is all I care about. In a couple of these mini obs for me teh owner send a check directly to me so I guess he treats my charge dependent upon his contract and/or relationship with his the owner.
My Invoices are always made out to his company.
My contract is with the client for design/prints only, and covers me fine. The question came up be/c a builder has asked if I'd add "value engineering" fee to my price to pay him for his time doing the detailed bid. I don't like handling anyone else's money for them, plus it'd just make me look more expensive at no benefit to me, so the answer is "No, you should bill your work to the client. But I'm happy to give you the dimensions and framing report to help you spend less time on it." I was just curious if there was a preferred way for that billing to happen--separated or part of the construction price.
IMO I think what the builder asked you to do was tacky and not ethical. But, that's my opinion. It would be like if the GC I mentioned asked me to include in my fee, his time to meet me at the job to show me the problem(s), or for that matter, a home owner asking me to up my price to the insurace company to cover his deductible.
Besides, if I were the type to deceive someone for money, that money will damn well go into my pocket, not someone else who wold enjoy the fruits of my self-compromised ethics.
Maybe I'm going overboard, but I'd also be cautious of doing work directly for someone who so cavalierly asks me to use such tactics.
Glad I don't place that much [comparative] value on a few hundred bucks.
It was probably more from the standpoint of a lot of architects that provide const mgmt services coordinate the engineers and some other services, and use pass-through billing of sorts, but regardless, that's not my business model. I do work and I bill for my work and that's it...as nice and simple as I can get it with no money entanglements.
"It was probably more from the standpoint of a lot of architects that provide const mgmt services coordinate the engineers and some other services, and use pass-through billing of sorts.........."
They've been reading to may books by Anderson Consulting, OR have worked for the fed. gov't.
One little side question for you:
Our builder came by with two sheets, one the floor plan I had drawn in detail, on cross section/graph paper, one foot to the square, very detailed and another a front elevation. I also have detailed plans for every cabinet and for the electrical and plumbing runs.
There were minimal changes to that floor plan but there was a copyright stamp from that architect's firm on that plan.
Some of those changes will have to be corrected as they didn't respect the handicap accessible request for the bathrooms, that was the only change to any structure it makes, impinging one foot with the utility room into one bathroom and so making it too small for a wheelchair and making the entertainment cabinet two foot longer and so an important double window in the living room, by the fireplace, a single one, changing the light/bright look of that room.
I would think that it was my plan. Why would they be reserving any rights to it?
You're getting into subtleties that I don't have a confident answer for. When is something derivative work? I'd love to have an answer from someone more knowledgeable on this on where the boundaries are and what the recourse is.
---"...what the recourse is."...
Oh, I was not thinking on any "recourse"! More a matter of principle.
They are now working the next set of plans, the ones for the trades to bid on and I don't even know what those will look like, other than what I cobbled together.
The GC told me that the architect "loved" my plan, that is was a neat, functional one and would work just fine as it was.
Guess where I learned what should be in houses and where so much of my information came from? Here, of course and magazines and books all here recommended, including our own from this site.:-).
More power to him if he want's to claim it, which I doubt it, it can't be that good a house plan for most people. All kinds of plans seem to be a dime a dozen everywhere.
Now I am wondering if that "patent" writing is standard for any paper work they do, regardless of the source? Will ask at the next meeting.
I have clients send sketches to me all the time with their ideas. I do my drawings, and sometimes there's a resemblance and sometimes not (I'd like to think I add some value :) ). If I draw it, I add my copyright. Even if the client's drawing was dead-on, I'd still be adding details, elevations, sections, etc. What should happen if the resemblance is so close that the differences are indistinguishable? Don't know...don't know what I'd do if I encountered that. I know that I have already put a joint copyright on a drawing, and maybe that's the answer in some cases.
I've got a problem somewhat related to Ruby's, but mostly because of my own naivety. (Let's put that up front...I did not communicate clearly and now I think I have a sensitive situation on my hands to undo.)
My electrician is SO AWESOME that I asked him if he knew a plumber. He said he did and that he would have him call me. The gentleman called, we chatted very little on the phone, and set a date for him to see the potential job.
At this point, my spouse and I have made VERY detailed drawings of the 1st and 2nd floor bathrooms. With measurements. (I know we had our contest, but we had come up with our own design too. The contest was a fun way of engaging folks in the creativity of "bathroom open source design". The winner's drawing gave us a few more ideas but we did switch some things around. The sink and toilet stayed where they were...less money. The shape of the shower that we created was a little different. And we are "lopping off" part of the bathroom and adding it to the adjoining Master Bedroom closet to create a walk-through closet.)
When the plumber showed up, I gave him the drawings because I needed to know if he forsaw any problems with relocating two drains. And splitting the hot/cold water feeds. etc. These also detailed electricity, etc. He asked more general questions than I expected, but they were all related to the bathroom's layout and our preferences. Very naive, I assumed that he wanted to know where his work fit into the big picture.
He stayed longer than I expected. I offered to compensate him for his time and he politely refused.
In a week, we came home to a very detailed proposal for a TOTAL bathroom redesign! He had changed our drawing and priced out EVERYTHING. He selected tile and fixtures for us! (?) Our plumbing job was now a demolition, plumbing, tiling, carpentry job for $21K. I looked at his card and went to his website. Too late I realize that this guy is a GENERAL CONTRACTOR who specializes in bathrooms and kitchens. Whaaaaaaa????? So he was talking to me as a bathroom designer and I was talking to him as a plumber, and we totally talked past each other.
We've already chosen the fixtures and tile we want, as well as the vendors we'll be using to purchase those. (we have a few connections to save money on some Kohler fixtures.) His fixtures are different and WAY more expensive. I totally am okay with mark-up, after all, he has to work with the vendor and delivery, etc. if we let him handle it. But he priced a $300 Home Depot fixture at $900 on his proposal.
Strangely, his plumbing numbers were competitive.
We really ONLY want a plumber. We don't want him to come back several times...we've bundled the work to avoid that. But we don't want anything beyond that. According to his proposal, the work we want, should he do it, would be approx. $4500.
I am completely embarrassed. Because we asked for a referral to a plumber, I assumed I was talking to a plumber. I don't know enough about GC's to have picked up on the fact that he was more than that. He spent all of this time, re-drew our drawing to attach to his proposal with a few more measurements (and a change we don't want). He's a GOOD guy. We've seen his work elsewhere. We know he is very good.
How do I bring this back to him? I would completely understand if he didn't feel that this job was worth his time (though I would still love to have him do it). I feel like he wasted all of this energy on us.
Agh. Oh great oracles of craftpersonship, I implore you to advise me!
Signed, will always ask on the phone next time, "plumber or more than plumber?"
Honest and straightforward, explaining how the misunderstanding came about, and ask if he will still do the plumbing phase. It's worth a laugh for after the fact.
Oops is still a four letter word.
Excellence is its own reward!
And maybe print out your post; it spells it out nice and simple. Being self-deprecating can help, too. Everyone who can share the laughter makes it a lot easier to deal with a simple misunderstanding.
That $300 toilet at Home Depot is what they call in the retail business a loss leader. They set the price low so people will buy it & spend more $ on the rest of the bathroom in H.D. while they are in the store.
The way they get such a low price is they have the manufacture make a lower quality product because H.D. buys in such massive large quantities they can call the shots with the manufactures. Yes there is a difference between the Home Depot toilet & the one the contractor buys from the local plumbing supplier - the word is quality.
Funny how his plumbing numbers are competitive. Maybe he knows what he is doing and he knows not to buy the Home Depot Specials.
Honesty?
JeffBuck Construction Pittsburgh,PA
Fine Carpentery.....While U Waite
Definitely honesty :) I just don't want to offend him. I already feel like a complete adelaide.
To ALL:
Well, I can now say I didn't offend him. I called him and explained my dilemma and apologized. I offered to compensate him for his time preparing the proposal. He actually thought that the mix-up WAS funny.
(BTW, regarding the fixtures, I can totally understand the low cost leader product marketing strategy of Home Depot...that makes perfect sense! I'm sure that the GC's supplies are high quality. Now that I've seen his work on his website, it is quite amazing. He and his son had a business in Austria before they immigrated here in the 70's. He is all about old houses.)
He asked me to send him a punchlist of the items on the proposal that fit our needs and they would rewrite it.
The electrician and his son that worked here today were very nice...very professional. They came to fetch me when they ran into something strange, just to keep me in the loop. (There is a lot about this house that is strange.) They put tarps everywhere and cleaned up completely when they were through.
We have a little momentum here and you guys were around to hold my hand when I was fretting about finding craftspeople. Thanks...
Sign me,
Never Too Old to Learn the New Tricks of Working Respectfully with Professional Contractors
Something in your tag line caught my eye:
...Working Respectfully with Professional Contractors
There's that R word. If only it was used more often, in both directions. I think that's the missing ingredient in an awful lot of disputes. As far as I'm concerned, everyone is deserving of respect until they prove otherwise.
good to hear....
honesty's the best policy .....even if ya feel goofy .....
now ya know U have a contractopr with a good sense of humor too!
Sometimes ...that one of the most important attributes ....helps to make the flow of a difficult remodel go lots smoother.....he probably get's along just fine with his subs and suppliers ....a good sense of humor and really grease the wheels.
Sounds like it'll all work out.
JeffBuck Construction Pittsburgh,PA
Fine Carpentery.....While U Waite
"It would be like if the GC I mentioned asked me to include in my fee, his time to meet me at the job to show me the problem(s)"
Sonny,
curious
since you have a relationship with this GC, when you go to see the problem, are you on the clock, that is, going to find the leak?
the first time you worked with the GC did you do an SCA or just an estimate?
guess the basic question is, do you treat GC's different than HOs?bobl Volo Non Voleo
I don't charge GCs if I'm just going to look at the problem, unless I so some investigative work while there. If that's that case, I charge for that trip including my travel time. I'm going to see a leak problem tomorrow of which he and his people can't find the source. So I'll lcharge him tomorrow and then again when I go back again to fix the problem, unless it's something easy I can have his people fix.
Generally more inclined to give a break to a peer than to snyone else. For example, anything I do or investigate for a condo association gets charged.
this may sound off key but not ment that way
if your time is important enough to charge a homeowner, why isn't it important enough to charge a GC?
Maybe I'm reading more into it than is ment, but "give a break to a peer" sounds like HO aren't peers, equals, to you.
sure sounds like a double standard, a lack of respect for HO's or those representing them.
Am I reading too much into the wording? I know writing a response doesn't always convey the meaning ment. trying to write in this in a non offensive way, not sure i did.bobl Volo Non Voleo
Bob, Bob K. just answered my reply.
I have a great relationship with a handful of GCs. They look out for me and vice versa. Of the 5 different property management companies I "used" to serve and their roughly 120 associations they have as clients that I used to do work for, I'm down to working for 3 of those mgt. companies.
I fired the rest. Seems arrogant, but as an article stated (Inc. Mag. months ago), I fired the non-producing customers. In my case, those who only wanted things done on the cheap, even if that meant short term solutions as opposed to more expensive but long term solutions.
In short, PITAs pay as well as those who, if I allowed, would simply use me a a free consultant.
As with many of our peers here, over the decades I've gleaned one hell of a lot of knowledge and expertise. To me - and apparently to many of my customers - what's "up here" represents a tremendous value to them. Those who don't realize that or don't care but just want freebies, pay, or get nothing.
Finally, I'm a firm believer in the "team" concept and those who place me on their team and whose team I'm happy to work with, we take care of each other.
I just had an AC company drop a duct into my garage. My air handler is in my garage attic, typical here in Florida. While here they guy checked out my entire system. He refused to charge me, not because of me, but because he does so much work for son Tom and the fact that my wife runs Tom's office. Two weeks ago I got him a job to replace an entire unit for a small condo ($1348). Still, while what he did for me was not a large project, it was no small job either. I was embarrassed that he refused to take any money. I told him if he ever needed any of my services to please call me to let me reciprocate.
On the other hand, while I typically charge condos for everything I do for them, sometimes I let minor stuff slide, but let them know it was done as appreciation for them using me on a continual basis. Example, I do all of the "common" element work for Willow Brook in Pelican Bay - an association with 14 buildings with 4 units each. I do literally tens of thousands of work there annually and never a peep about my prices. And all of the work is done on a "fix it and Invoice us" basis (T&M). So, occasionally, if something unique comes up and I can take care of it in 4 hr's or less, I do it, send an Invoice and mark it N/C. And those occasionally Invoices do not go unnoticed by the Board nor their Mgt. company.
Another association with 2 story framed buildings just hired me to set them up with a preventative building maintenance program. $660 to set it up and about $1500 for each semi-annual inspection and report, PLUS I do all of the repairs there anyway. So I take care of them occasionally as well, including things like making a presentation to the Board about replacing all of their stairway railings from pine painted wood to PVC or white aluminum, pros and cons of each and ball parks for each option. And the research and presentation is done gratus. In this case, I even suggested that they NOT hire me to do the change overs, but to hire a company who specifically does that kind of work because they wourl be less expensive than I. But they will hire me to write up the specs and as a const. mgr. to manage that particular project.
In short, I'm now reaping the benefits of the years and costs it took me to create and maintain my "brand" name. To do less would put me in a position of just another "handyman" working at my competitor's prices. Yeach!
However, for a different association, I'd charge them for the R&D and time spend on the presentation.
thanks for the reply
after I had posted I was thinking about your post.
your reponse is what I expected, I thought that is the way you worked.
glad I asked anyway
thanks againbobl Volo Non Voleo
Bro, I don't know what to say except maybe try to screen 'em better on the phone.... Where you are, anybody asking you to come see them ought to be billed for a minimum two hours, I figure.
One handy piece of equipment for this sort of thing is a fax machine, or a fax software for the 'puter. I've got the fax software if you need it; don't use it myself because my hardware fax machine sucks in the outgoing fax from the computer unless I go downstairs and unplug it, so I wind up faxing myself, duh!
If you've got a doubt about the veracity of whoever is calling, ask 'em to fax you a rough sketch of what they want, along with their rough budget. Tell them it's so you can respond honestly if you can do anything for them or not without having to bill them for a 'service call' or whatever you want to call it. In the case of yesterday's brainless bimbo, she would have sent you the take off and estimate from the magazine and you would have known without dragging your impressive carcass all the way down the continental divide that she was a waste of time....
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
Cloud's post brought to mind a long drawn out change this and that program. This was on the initial this is what I want. No I don't. I want this instead and....
After the basics were sortta ironed out, schedules were set up and a handle was had on the the SF price a money draw was submitted for my spent time and the start deposit. (including the retainer for the designer and engineer) No money was forth coming. No excuses no reasons ... No nothing.
After involving the designer, a small crew for rough lay out (sizing to fit) and also the engineer to some extent. That won't happen again. You better believe it.
If you go by the site now there is a structure there now, it's smaller and a world different than what was disscussed. Soooo.....
NEVER GONNA FEEL BAD ABOUT A NON-REFUNDABLE RETAINER.... EVER.
Who ever invented work didn't know how to fish....
"This week while explaining the above to a potential customer, but in more detail, I finally concluded by saying that the last time I looked steak was still more costly than ground round, and the "services" provided by MacDonalds was still considerably less costly than that of a family style reataurant - for very similar food & drinks. A cup of coffee at MacDonalds for $1.00 verses that same cup at $2.50 (a 250% premium) at Star Bucks. The differences are in the "experience." "
That is an interesting comparison to construction process.
It is on the LOW COST, McDonalds types of places that get paid up front. The family style or better restaurants don't even ask for any money until the food is delivered and consumed. And if the food is not done right then it can be sent back.
I THINK THAT YOU ARE RIGHT. CONSTRUCTION SHOULD BE DOWN LIKE A GOOD RESTRUANT. NOT ONE CENT OF PAYMENT UNTIL THE WHOLE JOB IS DONE.
I THINK THAT YOU ARE RIGHT. CONSTRUCTION SHOULD BE DOWN LIKE A GOOD RESTRUANT. NOT ONE CENT OF PAYMENT UNTIL THE WHOLE JOB IS DONE.
I disagree, and here's why: The check in a restaurant for a single table for one service is not going to bankrupt the restaurant if the guy 'goes to the bathroom' and never comes back (especially since it's the waitress who's gotta pay out of her pocket!). But, on a $30-grand job, if I front the money for materials (my credit at the lumber yard), the payroll (my cash out of pocket every Friday come hell of high water), and overhead (wear and tear on my truck, phone, computer, tool maintenance and acquisition etc., etc.)--and then the slime ball grins and says, well, sue me, dude!...then I've got a problem just a wee bit bigger than that waitress who's out of pocket $37.95 for a couple of plates of spaghetti and a few beers.
The bills on my jobs historically show that about 50% of the money is for materials, and 50% for labour. So like just about everybody else I know, I demand 50% of the estimate up front before I go to the yard and make my materials order. At least that way I'm covered for stuff for which I'll have to actually pay cash. To cover myself for the payroll as the job progresses, I ask the HO for progress payments if the job goes over a certain amount--and I've never had anyone have a problem with that.
If we then get to the end of the job and the HO decides he doesn't like the final bill or the final colour or the final anything and refuses to pay, I hope to be losing only my own personal income from the job--which hurts for sure, but it's not the same as having to go to the bank and take out a loan to pay for somebody else's home improvement!
On the other hand--I often do a complete job without ever doing an estimate of any sort, without a cent of $$ down and without ever seeing the customer: I just get an e-mail or a phone call, Please do this for us, and I've already got a key because they are regular customers with impeccable credit in my book. But that's not the problem we're talking about here. Fortunately, about 80% of my business is like that. And 80% of the rest is referrals from those regular clients or from other contractors I know, so I don't have the same worries as I do when some low-life picks up my card off a rack somewhere.
Huh! Maybe the solution is just to go pull my cards off all those racks....
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
Don't complain to me about it.
Complain to Sonny it is his idea.
He is the one that tried to make the comparison to a restraunt.
What I am getting at is that it is REAL EASY to say that some other types of buisness does this or does not do that.
But unless you are willing to take on ALL of the practices of that other business they don't use the comparison.
I have no complaint with his statement; I agree with it. But I just went back and re-read Sonny's original post that you were replying to, and I don't see how you drew the conclusion you did from what he wrote.
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
I think most professionals charge you to come in never mind the estimate
When is the last time you went to a doctor ,dentist ,lawyer ?
My tool service dept charges for repair est.
Call for service on appliances -they chgarge you to show up- repair or not.
Anytime I've needed an estimate for body work on a vehicle there has been a charge deductable from the bill if they do the work.
>When is the last time you went to a doctor ,dentist ,lawyer ?
My tool service dept charges for repair est.
Call for service on appliances -they chgarge you to show up- repair or not.
Anytime I've needed an estimate for body work on a vehicle there has been a charge deductable from the bill if they do the work.
As I told piffin, I must just be lucky on this. I can ask my doc, dentist, or lawyer what something would cost and not be billed a dime. I just sent two batteries to PC for testing and there was no charge. Never a charge for bodywork estimate. Must be livin' clean. :)
I agree if you are talking about" yo ur" doc etc its someone you've got a relationship with.
I have a list of clients same as most guys that just need a estimate to know if the budget is going to cover it .
But when its a new client or a shopper ,like the body shop its a different situation
And I still believe that if you were to try to get services from a professional you've never done business with its goin cost ya.
Good question.
I think any profession where the variables are complex, the estimate is very specific to one situation and the profit margin is possibly tight.
You don't realize it, but you pay doctors for estimates all the time. Some consulting professions. Actuaries, lawyers sometimes (depends on the type of case and law practiced), dentists, piano tuners (the good ones), appraisers...those are off the top of my head.
I actually love this piano tuner's response to a client complaining about an estimate:
I understand the frustration.
I used to be in the business. For me, I usually had ball park prices for decks. I did alot of them and I could throw out prices to give customers an idea, it was usually close. When I moved onto bigger jobs, additions, complicated renovations involving many subcontractors it was a nigthmare. !!! Especially when the building business went south in the early 90's.
I spent months getting prices in on a series of bigger jobs and did not get one.
I found out that people would just be using my bid to keep their brother in law honest. It was the reason I got out of the business. Might be easier now with computers??
I went back to school and got a MA in counseling. Now I get paid to listen to peoples problems. I am looking forward to the first contractor I get who is complaining about doing free estimates!!!! I will refer him/her to this site
There is an interesting spin on this subject, Bill.
If I'm right, then counselors are trained to ask questions and not to preach down to their clients/customers/victims. It might be fun to make out a list of the sort of Qs a counselor would have in stock for hurting estimators.
So, tell me, do you enjoy estimating?
And why do you suppose that is?
Can you think of anything that would make it more enjoyable ( or tolerable)?
Are you proud of the number of times that an estimate turns out to be a failure?.
Excellence is its own reward!
Not a bad idea, and yes you are right it is generally believed in the counseling profession one should not make value judgements. However sometimes that is not easy to do.
Speaking of estimates. I recently was visiting our local building inspector, looking to do add a bedroom. Our local township was supposed to have moved into its new building Last xmas or so. When I inquired, the building inspector said that the builder's estimator evidently left about 20% out of the bid. I think the job is about 2 million? I wonder if that estimator is looking for a job because it looks like this company is going to have to come up with about 400g plus penalties! Ouch.
See ya.
A company that let's that much lay out in the breeze with nobody else to check the work of one man????????
Shaking my head<><><><>.
Excellence is its own reward!
Just coming at it from a different angle, in what other professions are the clients expected to pay to find out how much the work is going to cost? I think that's the problem most people have with the thought of paying for an estimate--they just aren't used to doing it, so they need to be educated on why it's relevant here.
The first one that comes to mind is a lawyer. Maybe this is because I just got a bill for one hour from one for having explained what I wanted her to take on. When I was finished explaining, she said she didn't have time to take it on, and gave me another lawyer's name. She still billed me for the hour.
I don't want to sidetrack this with a let's-bitch-the-lawyers session. The point is that there are lots of professions where you get a few minutes up front, but after that the clock starts ticking.
Maybe the question we need to ask is, how many minutes should we be giving away before we 'punch in'? Half an hour? An hour? Two? Should it depend on the size of the job (Oh, yes, it always depends on that, LOL)?
Should we have an industry standard that we could all point to--like the lawyers...?
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
>When I was finished explaining, she said she didn't have time to take it on
Eeeek. I've always had lawyers I could call and ask, "Do you handle this kind of thing, and can you do it in this timeframe, or should I be talking to someone else?" Never been charged for that. Now, it's usually the first question out of my mouth after "Hi, how's the family?" so an hour wouldn't go by before getting the answer.
And that guy who prompted this whole thread...shame on him. That's a crappy thing to do. I've had people _try_ that. They say they'll use my services and start picking me for info on building costs, their prelim design ideas, etc. I've learned that I have to avoid sharing all specifics on design until I get the retainer. I'll market myself, but not give out free info that they can use to avoid my paid services.
How much info should you share before they commit? How much should my HVAC friend share by way of explaining a proposal? If you don't tell the prospective client _something_, then on what basis should they decide between you and a different contractor? Sonny, what do you think it's acceptable to share with a prospective client be/f you start the clock? Any information at all about you, your contact info, your services, past jobs? Serious question: if I called and said, "I need some work done, and your past client Mrs. X said you're the perfect dude for the job," how would the rest of the conversation transpire, and when/how would you first bring up money and what I owed for the conversation? I'd love to see how other people work this sort of thing.
Here's my theory on the whole "getting paid for estimates" thing- coming from someone who estimates for a living, and therefore gets paid for every one of them.
For some trades, roofing and siding, for example, it's tought to charge for an estimate, unless the job is very complex. If this is your specialty, you should have unit cost data that tells you what to charge per square, per LF, or whatever, and you should be able to assemble a price for a client in a very short period of time.
For example, if you show up for a roof estimate, and it's a 34' wide cape with an 8/12 pitch roof, in about five minutes you should be able to figure out that it's "XX" squares of roofing- ripped off and replaced. Using your unit costs, you should be able to give the clienta quote for "XX" squares of roofing @ $xx/SQ = $"ZZ". You don't have to show them that calculation, but in any event, the whole process takes a VERY short period of time, for which most folks won't pay.
On the other hand, if the client calls you out for a proposed kitchen remodel, room addition, etc., that's a different story. My feeling is, all you owe them for free is a "historically, an addition like that should be between $125-150/SF, or $50,000-$60,000 for 400 SF". Beyond that, if after spending a 1/2 hour or so discussing ideas, reviewing job photos, etc., they're interested in pursuing the project, it's time to start getting paid for your time.
I know this sometimes sounds easier than it really is, but I've seen it work, so I know it can be done.
Bob
What do you estimate?
Anything from small $5,000 renovation projects to a 2000' tall, $450 million telecommunications tower/observation deck.
Bob,
I would definitely agree with you that a roofing or siding estimate should be able to be produced quickly and accurately. I average less than an hour each, including drivetime----if I can keep the homeowner chit chat to a minimum.
but the method you outlined will lead most companies into trouble.I agree that it is very common---but it's also very dangerous from a business standpoint. Most companies of this type will use some kind of a multiplyier---$XXX/square.
But consistently using that method will lead to trouble----overpricing or underpricing----and eventually those companies are out of business'cause they are getting a high ratio of work they underpriced----and are losing some overpriced gravy jobs.
Instead of using a multiplyer---what I do is
Mentally produce each specific job. I will figure very exactly the materials used---usually down to each tube of caulk,and within a bundle or so of shingles.
I will know exactly how many days or hours the job will take---how many men etc. What will be done,day one,day 2 ,day 3 etc.
So job A may be a 20 square job taking one day.
job B,a 20 square job may take 4 days
The company using the multiplyer---even with modifications to the multiplyer will eventually run into problems---and probably run out of business-----because they are estimating prices without using their TRUE NUMBERS.
So----If I get a project---I KNOW I am gonna make money---usually know within $50-$100.
But If I lose a job to a "multiplyer guy"---I don't worry at all----I know he is probably losing money on the job---I probably even know how MUCH he is losing.
Basically the problem with the "multiplyer is that it is an "AVERAGE" and it assumes everything will balance out.
but in reality---it just increases the odds of closing ever increasing numbers of jobs that you are LOSING money on----while gauranteeing that jobs that could be completed quickly,efficiently and profitably are lost due to overpricing.
Now, Bob---I realize that YOU knew all this---probably much better than I do. I just mentioned it all, for the benefit of guys that go into business for themselves---and wonder why they are broke 3 years later! thanks for giving me an opening into an important topic.
BTW---I don't even want to think about the nightmare of estimating kitchens,baths,additions etc. LOL
Steve-
Very true, that you don't want to use a straight multiplier without considering the actual job at hand. I didn't convey this fully in my post, but you really do need to analyze the job further than just "$XX per square", based on site conditions, access, etc.
I do think, however, that you should be able to get to a point of not having to estimate tubes of caulk, bundles of step-flashing, etc.,- it should be possible to have a unit price per square for materials (which will be a shade high on some jobs, low on others, but close enough that you probably won't be off by more than $100 overall an most jobs). You should know the labor cost for a "typical" re-roof, which you'd then adjust based on the site conditions. If you wanted to get more detail and accuracy, you could have costs per square for roofing, with adds per LF of eave for ice & water shield, per LF for ridge vent, etc.
The idea is to keep you from spending more time than absolutely necessary preparing the estimate, while still taking into consideration the site-related issues.
Bob
Bob,
I have no problem with what you are saying----in theory it'spossible.
But in reality I find that not accurately calculating the ACTUAL materials needed will ultimately be wastefull of time and money.
If I do get the project I don't want to RE-VISIT the site to THEN calculate the materials to be consumed. I was already there once.
In my case ---since doing it accurately and correctly the first time takes so little time----it makes no sense not to do it right.Missing a roll of ice gaurd and a bundle of hip &ridge cap could easily run $100 right there-----plus the cost and inconvenience of running out to buy what should have been ordered correctly the first time. Add in a few square of 50 year shingles and it adds up each day.
but remember---my situation is different than most of the guys here. My projects are quite simple, and there are alot of 'em. It's MUCH easier and faster for me to figure materials for a roof exactly---than for someone to handle a kitchen remodel that way.
but the real money is lost not in the materials---but in the labor.Simple by the square multiplyers do not capture this accurately.
but planning the actual day by day or hour by hour production---at the time of the estimate quickly and accurately nails down the REAL COST. Again, I doubt this would be possible for people with more complicated projects.
I'm probably going to step on a few toes with my thoughts but here they are.
1) Difference between a "bid" and an "estimate" is nonexistent to most homeowners. Unless there's a legitimate out-of-scope item that wasn't obvious at the time of the estimate prep, I bet you'd get a lot of resistance if you handed over a bill that exceeded your estimate.
2) As a homeowner, I wouldn't consider paying someone to put together an estimate unless the work was very specialized and needed a lot of upfront research. As someone who used to put together substantial bids for commercial HVAC sales, I understand your anger with regards to putting together estimates and not seeing any resturn. However, many would argue that that's the cost of doing business. Just because you spent time on an estimate and the homeowner didn't bit doesn't mean they did anything wrong or that you're entitled to the job. Although you have every right to request a fee for putting together an estimate, I think there's too many contractors out there that don't so you'd be in the minority and would probably not be very successful.
3) Most homeowners consider most construction work a commodity (not saying that they should but they do) so why pay someone up front to put together a price when ten other contractors are available to do the same job (again, considering the work as a commodity, there's no difference in quality) and will estimate it for free.
4) Respect is a two way street. I had a portion of the roof on our house replaced a few years ago and couldn't believe how few callbacks I received from roofing contractors after calling them. Even after having some come by to put together an estimate, several never sent me anything in writing. It left a very bad taste in my mouth. I agree that your potential customer should have given you a heads-up that he thought your price was out of line but maybe he wanted to see it in writing to see the details of the work (to get an honest apples-to-apples comparison with competitors) or maybe he had been burned in the past by other contractors and said screw it.
5) Next time you buy a car or another big ticket item, don't bother shopping around to compare prices. Just buy from the first place you go because you might be wasting someone's time by having them crunch the numbers to get a bottom line price.
I don't mean to sound snotty to you but I felt I needed to offer a non-contractor's point of view on your comments.
I don't take your comments as snotty at all. They arre well presented. Don't know if you read Bob Kovaks reply before writing but he did a good summary.
I'll respond to some of your thoughts tho. This is turning into a well argued thread with positive direction for all to learn from.
1)
bid vs estimate
You are probably right that many HOs don't differentiate, and it is important for me to clearly define that difference. I find that the higher the price is on the job and the greater discrepancy between the estimate and the final bill, the more likely the client is to interpret an estimate as a bid. I had one where tjhe original ballpark est was like 47K but after redesign and adding elements the actual est was about 70K. She started refering back to the original "bid" and I left her looking for another builder. She has paid for the design and estimate work.
2) adressed by Bob above.
One thing to keep in mind is that when the est process is combined with an element of design, there is actual production and value added intellectual work being sold, not simply measuring a price.
Also, I think the anger you refer to is in ref to a HO who acts promising when it later becomes clear that they are not really serious. This is fraudulent on thed part of the HO.
3) HOs who consider remodeling a commodity instead of a customized service simply need some education. That is part of my original sales call/initiation to my process/first date.
I'll admitt that selling on reputation instead of price has its advantages. They ply me with cake and wine and smiles to have a chance to get on the list.
4) Respect
Judging by the number of referals I get, even from those who found final bills to be higher than expected, and by the way we cordially treat one another under the Golden Rule, I must be doing something right.
Your comments about contractors who came to look but never returned a price may have something to do with the fact that you expressed an expectation of free estimates. A custom remodel is not like pulling up optional pricing out of a computer at a car dealership. It is more like pricing a custom, handmade car, sometimes including raising and killing a calf or two for the leather seats.
But for just a roof section replacement - maybe not. I can also specualte that this roof section might have been located such that it was impossible to gaurantee the work without doing surronding sections and that you were unwilling to stretch that far so they declined the opportunity to work under certain restraints. or maybe they were just unprofessional....
5)
Like I mentioned above, it only takes a few minutes for the car guy to crunch a couple numbers, he doesn't need to design the car your way or consider whether you will be driving it while he does work on it.
.
Excellence is its own reward!
on a completely different side note ..but one that pretains to your post....
I spent sometime selling cars.
The very first thing we were taught was to not waste time with tire kickers.
If I had the slightest indication that the customer was not ready to buy ....I'd answer their question as to the "real price" by pointing to the sticker price and asking them to come back when they were serious about buying.
In life...nothing's free.
Not even your car salesmans time.
Jeff
Buck Construction Pittsburgh,PA
Fine Carpentery.....While U Waite
If I were told that by a car salesperson I would have taken my business elsewhere. While you might live by the "nothing is free" creed, most businesses provide estimates for free. I work as an engineer and we are basically required to put together (at no cost) detailed scopes and costs that we are essentially held to barring unforeseen circumstances. I can't understand why people think there situation is any different. Call it marketing, the cost of doing business, whatever. Unless you specialize in very unorthodox work where you can justify to a client that a fee for an estimate is warranted (or possibly an involved kitchen remodel like Piffin suggested), I think expecting payment for an estimate is unreasonable. The people that don't think it is unreasonable are of course the contractors that are spending their time on the estimates. I'm not saying that their time isn't worth anything but I just don't see how one could succeed with a customer by requiring a fee.
In response to Piffin's reply regarding my roofing situation that I cited earlier, all that I expect from a contractor is that they treat me like they would want to be treated themselves. If someone weren't interested in the job I needed to have done, just call me- don't leave me hanging. I even called back a contractor twice after he visited my house- each time same response "it's in the mail". Talk about bad business practice.
You work for as an engineer? For yourself? Or someone else?
Because the last time I looked, my friends working for someone else were doing the estimates and getting paid their salary. Their company (just like mine) budgeted for that in the yearly budgeted as "client development" and took it out of their margins. They also tracked the time spent.
My pal who works for himself charges for his time on the detailed estimate. That is his hourly fee. The clock is running. Even if the client decides to use someone else, he has still educated the client and given him some ideas about his problem and solution. His fee IS his salary. He doesn't fly across 4 states to look at a manufacturing facility or foundry gratis. That would be ridiculous. His clients know he does good work and won't overcharge them on the back end.
The doctor analogy? That holds. Maybe all you pay for a head cold is a fixed fee office visit price. Without insurance that will still run you about $75-80 for 10-15 minutes with a nurse, 10-15 minutes with the doc and a lot of time waiting in a backless gown on an examining table. But if you have symptoms that are easily solved with a "recommended procedure" (per the PPO or HMO), then you are paying dearly for a few visits to a few doctors, many lab tests, possibly a CAT scan or X-Ray, etc. Even a sleep test. If I sound like I know too much about this, I do. So let's not go there. I was paying an enormous amount of money, on COBRA and sometimes out of network, for specialists to figure out a diagnosis, prognosis and schedule for maintenance. Again, the more variables, the more the estimate costs.
Dentists, same story but less so. There are only 186 (187?) diagnostic codes for the dental profession. That limits the amount of complexity.
Lawyer? Again, complexity. A will? Generally fixed fee. A court case for something serious, like, oh, a crime or charges of negligence? You're sitting down with them for a few hours, they are taking depositions and the clock is running. OR! They hear the bare basics of your case and take a risk...no fees for an estimate but 50%+ of any monies awarded for damages or costs. That's a pretty nice margin. The paralegal's costs are fixed...they do most of the leg work. Lawyer shows up for court and high level decisions.
Look. I'm a homeowner and I'm on a strict but realistic budget. As someone who works for a church now, my rewards are not of the monetary nature and I was called to that...and that's cool. And I have no problem paying someone for an estimate. I've offered it to four contractors now, and three have politely declined it. One took it and MAN was his quote detailed. I expect his quote not to make it up on the back end and I expect the other quotes to make it up somewhere. These are professionals, they are good at what they do (I've seen their work in other houses), they don't need to advertise and they are exactly what this house needs. I'd RATHER pay them $100 for a detailed estimate. It would make me feel like more of a partner in this. I'm sure it will all feel better after I have paid them for the materials as my deposit on their time. But I believe that professionals will have professional standards and valuing their own time is one of them. When someone spends 1-2 hours coming to my house, taking detailed measurements of everything, inspecting everything, writing it all down, formulating a plan and a rough design, and asks me about materials, needs, future plans for the space, etc. ----I value that and they should too. I'll pay for it.
In fact, that's how I've weeded out the wheat from the chaff. What questions do these folks ask me? How well do they listen to my ideas? Do they ask me what result I expect and provide different options for getting to the result? Do they take the flashlight I offer them and begin peering into my (unfortunately open) walls? Or talk about what they see in there? Do they outline some of the unknown variables?
I WANT to pay for that. Because I'd rather have that than someone who says offhand, "okay, we'll tear all of this off...do this...do that...here's a ballpark estimate."
It's just a preference.
Of course, it seems like it couldn't hurt to slip into a conversation, "Tell me what has frustrated you about contractors you've worked with in the past." And then have them listen to me. And then answer, "Okay, here's how I work and how that kind of thing can be avoided..." It may also give the contractor a quick assessment of the nature of this possible future client and time to get out if something doesn't "jive'. But to someone like me, it would be terribly reassuring. It communicates their willingness to negotiate up front how they like to work and what both sides will expect. I'd like that too.
Edited 9/5/2003 2:43:50 PM ET by jmo
Good point - kind of. I work for a company, not for myself. However, from the client's eyes, it doesn't matter. The point was that the client did not have to pay to get a scope and cost. Sure, I get paid for the scope prep time but it came out of my company's bottom line. Like most companies, mine has a certain allowance for "marketing" and my point is that contractors probably should be doing the same.
Bottom line is if you can get paid for doing an estimate, more power to you. In most industries, don't expect that you can get away with it for long without seriously eroding your backlog of work.
stonebm, the company the employs you does get paid + profit for every part/assembly you design. they even get paid for your slack time.
How?
If you average 10 hours (made up number, as are all#'s here) per job, 2.5 hours slacktime per job, and they sell %50 of your jobs. and you cost them $100 per hour wages/salary, they are adding $2500 +%XX markup on to every job you do that sells.
If they don't, they are losing money on you and you will be out of work 'cuz they will be out of business.
No matter what they think, no matter what their policies are, no contractor is giving "free" estimates. They are just earning less per hour on average than they think cuz, they are not counting those estimating hours as "work."
If they put in 60 hour weeks for 50 weeks a year and 20 of those weekly hours are office work and estimating and they take home $60,000 a year, they are making $30/hr for office work, . . . and for estimating, and, . . . for the time they are "working" on a job they successfully "bid."
The cost of their bad estimates is spread out over the paying clients at $30.00/hr times the ratio of successful/unsuccessful.
Thank you Sonny Lycos and Michael Stone for making me see this.
SamT
I know for a fact that we can't bill out something to a client that's not related to a particular job. Non-billable time includes time spent on things like preparing scopes. Sure you could argue that if I make $30/hr and I'm 80% applied, I'm effectively getting $24/hr for my company (20% at no revenue plus 80% at $30/hr) but that's accounting for you. It amazes me how many ways accountants can cook the books. Bottom line is that we don't get paid for that other 20% of non-billable time.
stonebm, I did not say nor imply that your company lists slack time or time on a non-sold job to any sold job.
What I said was that your company charges the sold jobs enough to make up for the unsold jobs, and that can be figured using your total paid hours and the ratio on sold/unsold jobs and their overhead and desired profit.
The accountants mayl have some esoteric formula, but it breaks down that way.
your company MUST make a profit on your TOTAL time, not just the time you spend on sold jobs. And that profit comes EXCLUSIVLEY from sold jobs.
Just as a contractor must figure his wages on his TOTAL time if he wants to be honest with him/herself.
Sam,
If I understand what you are saying correctly---then I agree with you wholeheartedly.
The way I see it-----trying to get " paid for an estimate" is really a wasted effort---poor use of my time.
As you have described---- am already being paid for the estimates in a sense.
Each year---I will spend less than 1000 hours on "production"
About 300 -400 hours on misc. estimating,bookeeping etc.
I track all this time. Because I want to spend as little time working as poss.
all the time must be paid for by the less than 1000 hours of production.( thisyear will probably top out under 800
It is,for me---MUCH more effective to concentrate on increasing what I can charge and earn during those 1,000 hours of production than it is to beat my head against a wall trying to convince people to "pay me " for an estimate.
And each year---more effective screening of tire kickers gets that 300-400 hour average lower and lower. Next year I will be shooting at about 260
260 hours. Good on. Keep it up. Eventually you will arrive at a"floor", but still keep trying to lower it. It is good to have a target even if that target is unatainable.
SamR
Edited 9/6/2003 12:27:03 PM ET by SamT
It's simple: your company is putting the cost to them of your unpaid, unbilled hours into overhead, and therefore charging all the customers that do pay them something for things they are not getting, i.e.: services you gave away free to somebody else.
The only thing that's 'good' about that, is that it enables them to employ you--and that's good only from your point of view.
Now, if you want to see it get complicated...follow the line of reasoning down the line, and see how much more you have to pay for consumer commodities you buy all the time because the manufacturers of those products are paying extra for your unbilled estimating time.
I say again: don't charge Peter for what Paul got.
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
But Stone, even you must know that your hourly pay is not the hourly fee that they are charging the client, yes?
My "billable rate" was 6x what I was being paid per hour. Sure maybe .5x of that was for benefits. But the company was making 4.5x my hourly rate of pay. Out of that they paid my admin, marketing/sales (client development), legal, PR, real estate, financial and corporate taxes. And were still able to put some profit back into the company and/or pay it out to partners.
If a consultant gets paid a salary of $60K, they are billing (on average) 2000 hours a year. (Our consultants were "required" to work at least 50 hrs a week, bill at least 80% of their hours, were not paid overtime and I'm deducting 80 hours for vacation for the year.)
In Human Resources language, the consultant makes $29 an hour. ($60k/2080 is the standard equation.)
In Sales language, the consultant is billable at $174/hr + expenses.
By the way, I would say $60K is for a mid-level consultant in my old world. The seasoned vets in their 30's with a Master's Degree were pulling down more than $100K. I won't even venture into PhD or 40+ territory, especially partners. So for those folks, the client paid a whopping $288 per hour minimum. More...since experienced consultants billed at 7x-9x their hourly rate. Since consultants and service providers require less costs (few materials or suppliers or contracts or union problems or equipment compared to manufacturing or construction), that is a pretty tidy margin.
Enough to HAPPILY send you to the client on their dime to sketch out a detailed estimate.
I think the white collar management consulting world is ridiculously overpaid, btw. WAY more than most of them are worth. And the work is soul-sucking and demeaning a lot of the time. So, go them.
However, the philosophy is still the same. Your employer pays you an hourly wage that is much, much different than what they are charging the client. And that more than pays for client development.
Edited 9/5/2003 7:01:35 PM ET by jmo
“I hate the selling part the most. But, we are not all the same. Not everyone is a good sales person and I guess the thought that everyone can be doesn't sit well with me. Do I think I can be adequate, yes. But really good, no. Why? I don't like doing it. And my experience is that people are good at the things they enjoy."
Dan, I hated wall papering, electrical and framing, but ask me if I forced myself to learn the above. And guess why. I also hate getting up at 7 AM. I‘m a night person,and have always hated getting up before around 9AM. And 7Am is sleeping late compared to some of my peers, probably “most” of my peers. I hate this and I hate that, but I’m also a realist. I so what I do to get to the point where I can do what I “enjoy” doing.
“If they put in 60 hour weeks for 50 weeks a year and 20 of those weekly hours are office work and estimating and they take home $60,000 a year, they are making $30/hr for office work, . . . and for estimating, and, . . . for the time they are "working" on a job they successfully "bid."
San, you’re welcome. I get paid $83 /hr to drive to check out jobs.
It took me years to confront my problem of being too scared or embarrassed to charge for my “productive” time, and yes, it is “productive” time that benefits my customers. It has value! But one day I just said to myself: “Enough of this crap. From now on I’m going to ................” No more whining to my wife. No more getting myself all upset, and no more spending hours upon hours what it takes to put a detailed Proposal to paper.
And I was scared s**t. They say courage is not the absence of fear. Fear still exists, but it's "courage" that forces one to go on anyway, in the existence of fear.
I leaned how to “sell” enough to “sell” myself first. Selling the job is a piece of cake, but selling yourself 1st is the 1st task at hand. And that was how in Michigan, and agricultural and blue collar worker area, i routinely got roughly a 20% premium on roofing jobs, and with a closing rate of at lest 90%.
Again, it’s the difference of between thinking as a tradesman and a businessman. Tradesmen build 1st.. Businessmen sell 1st.
I was told it cost well over $10,000 to buy the electronic piece of equipment that my Chrysler dealer used to determine my electronic problem, and charged me $146 for the diagnostic “service.” Changing the electronic board was and extra charge. And I brought my problem to “him.”
Well, the piece of equipment I use is called my brain, comprised of my experiences, expertise in the trades, and the running of my business, and cost me a hell of a lot more than $10,000. And my equipment improves daily, not having to be upgraded from time to time, at additional costs.
BTW, my SCA fee is “not” credited to the job price. It’s a separate fee for services rendered. It it was credited, then I would not reallly be getting paid for it, would I? I don't believe in that "rationalization" that it's covered in my "overhead." Besides, why should Joe, who did hire me, pay for my time on Bill's job who gave the job to someone else?
And that's just fine...
as a car salesmen ....I didn't like people wasting my time any more that I do as a remodeling contractor. Spend time with the spenders, as the saying goes.
As to a contractor not leaving you hanging...maybe if you paid someone for an estimated they'd show a bit more interrest in you as a potential client?
They'd already know for sure you were serious.
Works both ways.
Both profession get's tons of tire kickers...neither profession likes to waste time with them.
I'm not here to change your mind, but if you are looking for top notch service, you may be limiting yourself buy not paying for a professionals services.
Like I said, I don't chrage for estimates...but all you're getting for free is a big wide ballpark. As soon as someone implies they don't wanna invest any money upfront to detailo their dream remodel .....I walk.
What's the beef with a fee that's usually gonna be rolled back into the project anyways?
Never understood that one.....unless you are shopping for bids and don't intend on using the info as intended?
JeffBuck Construction Pittsburgh,PA
Fine Carpentery.....While U Waite
The original post was for a reroof job I thought- hardly a dream remodel. As I said in an earlier post, I understand fronting some $ for detailing out a $50K kitchen remodel but this whole discussion was about a reroof. Also, as to your "tire-kicking" argument, the problem with "tirekickers" is that they will end up buying and you can't always tell who's serious and who's not. I don't know about you but when I'm at the point at a car dealership and asking about best price, I'm definitely not kicking tires, I'm buying and that's why I want best price.
Sounds like you have a lot of expierence at getting estimates. Got any expierence at hiring contractors? Matt
I'm probably going to step on a few toes with my thoughts but here they are....
I'd answer your points, but Piffin's already done it for me! Thanks, Piff!
One thing though: in fact the HO in this case never had a clue how much his job would cost until he called me in. His story of a quote 2 grand cheaper than mine is pure malarky--there just isn't enough slack in the size of the job. Nobody around here capable of doing a professional job would touch it for that price. I'm generally a good bit less expensive than the big contractors; but I'm up near the top of the small/individual contractors in this area. Still, there just isn't enough juice in it.
What I found out (Later, of course) was that the guy had gotten my card from the local tool-rental house about a month ago. He asked the manager about me and got a good referral. He didn't call me until three days ago. What he was doing in the meantime was trying to figure out how to do it himself--make it a family job: himself, his son, his father, the BIL and the DIL and so on. Plus, I found out his son has a job working at the yard he specified I had to use. (I happen to know employees there get -10% and I'm sure he was counting on having his son buy the materials once I told him what he needed....)
So that's what the deal was. Pure bull.
So I wasted my time and that was right from the git-go. Only I wasn't awake enough to see it 'cause it looked like a nice easy job, I had an opening big enough to finish it with no problems, and it just sorta fell into my lap.
Duuhhh. Well, one more HO on the permanent S list, and the ol' Dinosaur is gonna be a little less trusting next time, so you or one of your brother HO's is gonna pay for this guy's nonsense. Is that fair to you? No. But it's not fair to me the other way, either.
Challenge for ya: Find me a solution that only penalizes the guilty party.
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
My solution: Steer clear of these types of people. As you know, it takes time to visit a job and put together an estimate and no one wants to waste time. I'm sure you get calls from people that you just don't pursue for whatever reason. The first step on your part should be (and probably is) to assess the job and the client to figure out if it's worth your time. Sounds like you just misread this one.
all that I expect from a contractor is that they treat me like they would want to be treated themselves.
.....
My solution: Steer clear of these types of people.
I'm not sure if there isn't an inherent contradition in your two different answers here.
Of course, there are slimeball contractors out there, too. They're the same type as this mongolian anthropoid HO I've been whining about, and if any one of them tried to hire my outfit to sub part of one of their jobs, I'd be smart to get cash up front from them, too. And to charge 'em for an estimate--ha, ha, ha, fat chance....
I'm sure you consider yourself an honest, serious homeowner, one who wants to be careful only to do business with reputable contractors who will never do anything other than his way, and who feels entitled to control every 2d nail that goes into the job or to adjust the billing unilaterally if there's any argument. In short--and I'm not trying to be insulting here, this is the correct psychological terminology--it sounds like you're anal type A, and maybe (maybe, I said) some of those contractors who didn't call you back sensed that they probably wouldn't 'bond' well with you and decided just to 'steer clear' of your project.
I could be all wet, here. It's just the impression I get from reading your posts. I'm definitely not trying to start any pi$$ing contests.
I do agree with you one hundred percent about calling back--in both directions. In fact that's my major beef with the beetle-browed HO in this case: he didn't communicate with me and thereby let me do a bunch of useless work when I could have profitably have been doing something else (like sleeping! I had to work until 2am to finish off his paperwork properly, because I'd had an emergency service call the afternoon before when I had counted on doing the estimate originally.).
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
As i stated on the JLC thread about the same issue, how does a manufacture get so many people who only want to buy their particular “brand” of products. Things like Chevy, Sony, Cadillac, etc. Or more specific, why do so many people only buy at Dillards, only eat at a certain favorite restaurant.
The key is to give people reasons to “want” to pay you for “all” of your services. Or rather, the key is in creating the “demand” for you, and only your services” that create such of a “perceived” attitude of what your name represents.
Most contractors hate to sell, only wanting to ply their technical trades. Consequently, we look for any way (rationalize) possible to avoid having to enter into what’s called the “selling” process.
Let’s at least admit that fact that as humans, we simply do not want to do what we don’t like to do, preferring instead to incur all sorts of things including bitching about the customer who never even calls us to say they hired someone else. Even that disappointment is easier to take than actually learning how to sell, and then actually selling.
By God, that’s my price. They can take it or leave it! And so if they leave it, your ego is still intact, but you still left several hours on the table that you spent in meeting with them, figuring out the estimate, typing it and returning to their homes to present it. And they’ve lost nothing, but gained one hell of a lot of information supplied by you - for free.
But your ego is still in tact, as you bitch about one more potential customer who never even had the courtesy to tell you: “No thanks.” Seems to me that our egos, not the public, is the enemy.
I am continually amazed at the innovative way people come up with to justify “not” charging, rather than using that same innovative intellect to develop a system whereas they can charge to get paid for their “valuable” services. It’s like digging a hole by hand with a shovel because it’s too much trouble to learn how to use that back hoe.
And so our industry peers continue to work their asses off for comparatively nothing, and bitching about it each week - but their egos are still in tact. I can live nicely if I only got a buck for each guy across the country who works 60 hours per week for less than $1800 - $2000 after expenses per week.
Hmm. I think you are right about the sales deal. I hate the selling part the most. I think sometimes my only goal is to get big enough to hire a sales person. And I agree that at times I, and others I know of do allow the ego to get in the way when a good sales moment would have been the better point in judgement.
But, we are not all the same. Not everyone is a good sales person and I guess the thought that everyone can be doesn't sit well with me. Do I think I can be adequate, yes. But really good, no. Why? I don't like doing it. And my experience is that people are good at the things they enjoy.
So I guess the only answer for some of us is to be adequate until we can grow to the point of hiring someone.
The charging for estimate thing is I think a decision based again on what you believe is fair in your own mind. And what you believe you can sell or justify.
I fully agree with the statement about money. No reason to do this if you can't make a good living at it. DanT
I've partially solved this problem by adding a line item on my bid form for how many hours the proposal took. Its the last number I punch in and my bid rate is double my fabrication rate. If I get the job my time is compensated. If I don't, my time is compensated as long as I get better than 50% of the projects I bid on.
I've partially solved this problem by adding a line item on my bid form for how many hours the proposal took. Its the last number I punch in and my bid rate is double my fabrication rate. If I get the job my time is compensated. If I don't, my time is compensated as long as I get better than 50% of the projects I bid on.
Do you have anyone bitch about that, or do you make that clear in your first face-to-face? Or do you just deliver a bottom line figure without the details, as Piffin suggests?
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
It's honestly never come up. I present a proposal to do a set amount of work for a set amount of dollars to be paid at set percentages of completion. I offer a 2% discount for prompt payment and a 2% penalty for late payment. I don't present a line item bid to the customer, though that's how I arrive at my total. I use unit pricing with modifiers for pitch, height, hips, landscaping, distance, and other difficulties including gut feelings about bad customers. When I add bid time at the end, it is representative of the time I spent on site and at the desk. If it takes me 45 minutes to take-off on a set of plans, that's what I charge. Four hours spent for a complex bid, it gets added on.
Now, to qualify this, I seldom bid against anyone else. Less than half of my work is sold to homeowners. The majority of my work is as a sub. This was not always so. I developed my reputation, as you probably have, trying to do better than average work for average price. At some point, I finally realised that if I was gonna do better than average work, I needed to be compensated. Charging for my time (all my time) was one of the things I changed.
Now, back to the original question: how 'bout if I hold the guy while you hit him?
Now, back to the original question: how 'bout if I hold the guy while you hit him?
It's tempting, bro--but then we'd have to pay some lawyer up-front just to tell us she was too busy to get our butts out of the clink....ROFLOL!
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
Dinosaur This ones for you!
My time. My expertise, which comes from “experience”, should be respected. I am a professional, & in a profession which is the single reason why I was called in the first place. Let me repeat that…the single reason why I was called in the first place. Otherwise why call me or any of my peers? I wish I had a ten dollar bill for all the times I spent hours creating a proposal & not even receiving the courtesy of a phone call telling me a simple thank you, but we decided to hire somebody else. Too embarrassed to tell me that someone else was hired, but not to embarrassed to call me up and ask for “free” time, “free” educational information about their proposed project.
That money represents “respect” to me. I like knowing that what I do, and what I provide has value, and it does. I like that because it proves to me that I represent value for the combination or sum of my experience, time and talent. It’s my life and my time. I earn respect, and I deserve respect and each time I visit a new client charging for proposals is my way of saying to them, I am a professional. I expect to be treated, and paid accordingly.
I have often thought about the anomaly that the public considers us “professionals” while we are working with our hands, but apparently when it comes to working with our brains, design talent, financial talent, construction management talent, ECT, we are worthless, not worthy of payment. It’s amazing how the public thinks nothing of dropping a $20 tip on an $80 dinner and drinks, but ask for $100 for the tremendous benefits they derive from a detailed proposal and look out!
I could not have said it better.
I re read my previous post & I forgot the most important part Where I got the 3 paragraphs from. The post origionated from a post on a thread at the JLC forum written by Sonny Lykos. Sonny I apologize for not putting that on the first post. It's me Carl from the JLC forums. I use the name siding guy over here.
For all you who dont know Sonny let me sum him up. I have learned more from him in the last year & a half than I had learned in the 8 prior years of being in the trades. His whole philosophy should be studied by all. I still to this day thank god that I stumbled acrosss these forums. The amount of knowledge that is given here is immeasureable.
Let me explain that value and respect another way.
Sonny taught me to think of myself as a professional first.
Then I learned to get others to think of me as a professional with due respect and honour.
Then I learned to begin turning that respect into dollars.
now some folks think money cheapens things...
Not I.
Because I see money as the things it represents, knowledge, experience, honour, production, time (which is a part of my life - and life has value)
But there's more -
My wife and daughter have both had severe medical needs/expenses in the last couple of years.
If not for the self-respect I learned from Sonny, I may have let that burden overwhelm me.
If not for the increase to my income resulting from following his advice, the medical bills would surely have overwhelmed me. I dance a step ahead of bankruptcy as it is, but I'm sure that a good third of my income has resulted from his advice.
My philosophies and mental outlook are such that I fear to think what I would have done without enough income to satisfy those creditors. Which comes around again to self-respect. Many of us find it hard to hold our heads up high and look other men in the eye if we cannot pay our due.
So - if we don't hold ourselves and our profession with respect and honour, who will???????????
ps - I use the archaic definition of honour here, for those who want to look it up.
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Excellence is its own reward!
Sorry to intrude as a HO lurker, but I want to speak up and tell you that I agree with you. You not only get paid for your services but also your time. The time spent doing "free estimates " is time on the clock that you could be earning "real money." I don't object to paying for estimates, and as a matter of fact it tells me the person and their firm is more professional and proud of their work.
That's not an intrusion--it's a welcome comment from the 'other side'.
Dinosaur
'Y-a-tu de la justice dans ce maudit monde?
Dino,
First time I've visited this forum and right away someone pushed a very sensitive button!!
My wife and I have a paint contracting business and I can definately relate to your anger with regard to the estimate game.
We get a lot of calls from real estate agents who want a paint bid. We spend our time, energy, talent and computer frustration to get it to them and we never see any work. They simply use the number to lever a deal.
If you have a thriving business with plenty of work, I wouldn't hesitate to put your plan to charge a deductible fee for an estimate. We, unfortunately, are in a trade where free estimates are just another "necessary evil" of doing business. Keep telling the wife we need to cash in our chips and go home.
Don't let the bas***ds get you down!!
Regards,
Mac
Mack-
RE agents are one group I would definitely charge for providing estimates to. As you've seen, they use and abuse contractors to get pricing for their "deals", many of which never materialize, and you'll never get any work out of them.
When I did remodel work, I'd get calls all the time- "My client is thinking of adding on to the house they're considering buying", or "can you give my client an estimate on a kitchen remodel?". After the first dozen or so, I started charging $150 minimum for these consulting services. Several of the agents got offended, and never called again (oh well- no big loss). A few still called, and the clients were glad to pay for the advice- it filled in what the home inspector never covered. Really, though, how much effort can a buyer really expect you to expend for them, when they don't even own the home yet?
Just my two cents,
Bob
I don't like the idea of agents getting an estimate for other purposes. To my mind, it's simple: if you are interested in having the work done by a pro, communicate that information, and you should be able to have a discussion about pricing for free, even if this is one of those times where you are trying to pick a finalist out of NO MORE than 3, I'd say. The level of detail may vary, but you should at least be able to establish the concepts and quality level. If, on the other hand, you are getting a price for legal or negotiating purposes, and you really have no intention of hiring someone to do the work, it is UNETHICAL in my mind to get estimates and not pay for them. You are essentially misleading them deliberately, and that really isn't right.
If, on the other hand, you have narrowed down to say three GCs that you think are the best three to do your new house, I think its reasonable to expect them to spend a couple of hours in meetings and preparing some sort of estimate. Then you pick your finalist, and flesh out the details from there.
Mack,
I am a roofing contractor and formerly felt I was being "USED" by real estate agents.
I know for a fact that over the years I gave well over 100 "estimates" for roofing work which never resulted in a single dime.
I will admidt I am a slow learner---but eventually I learn.
Several years ago I decided to simply refuse to give estimates to realestate agents,landlords, people buying or selling a property etc.
EUREKA !---what a simple solution.
Now sometimes,even now ,my screening process fails me----and I arrive to figure an estimate----only to see a " FOR SALE" sign in the yard.
In that case I will simply call the prospect and verbally give him a high number-----nothing in writing. Years of experience tells me that there is ZERO chance of a house being bought or sold resulting in business for me.
And if my screening process gives me the slightest hint that the "prospect" is a rental---I ask straight out " Is this your personal residence sir?"
Land lords will try to gussy up the answer by replying ,"no---it's an investment property"
I simply respond---" OH, I am sorry sir---I am only insured to work on owner occupied properties----But thanks for calling".
Shazlett,
I am surprised by the landlord exemption. I don't do my own roofs. I have a roofer in my area I work with. Of course I don't get bids from him either. I just call him with an address and tell him to handle it. DanT
I have a number of clients just like yourself. I've worked for them numerous times and I know the check will be in the mail the day they get the bill. For that they expect me to drop what I'm doing and take care of their problem asap. What they need done is usually not my favorite thing to do and they respect that. When they refer me they know the type of jobs I like. They had to get in my club, just like I had to get in theirs. One hand washes the other.
Dan T,
what can I say? I am by NO means the most expensive roofing contractor in this area( not by a long shot)----but I am working on it. LOL
My bread and butter comes from very ordinary middle class folks who have lived in their homes for years,and INTEND to live in their homes for a long time.
that's who I seem to relate well to,and do well with----so that's who I concentrate on.
Landlords are definitely looking for someone cheaper.Not to insult anyone---especially you---but almost every landlord I have EVER talked to tells me" I am not interested in the cheapest price---I just one the job done right"----But in the end,doing it "right" always seems unreasonably expensive to landlords. No sale.
You have to make a concerted effort to become a renaissance man, who feels comfortable in jeans with a tool belt, or a tuxedo and those who routinely wear them.
Also develop a different sales “system” for selling to the white and blue collar families. I did that back in Michigan where he ended up having a roofing division. Our typical customer was a white or blue collar worker or a farmer. We lived in a typical small town area.
I also routinely got between 15% - 25% more than my competitors. I did that by forgetting that I had competitors. In fact, in my mind, I had no competitors. I explained what I proposed to do and why - each operation - and backed up what I said with documentation so they didn't think I was just flapping my lips. If I could do it, you can.
Sonny,
in general I would agree with you on this.
But-----
I am really quite happy with my "bread & butter" customers.
I have a little niche---and that's what I concentrate on.
I am 41 and will be easing into semi-retirement in about 6-8 years.
In fact, once my tuition paying days are over, I think I might quite like working for someone else in a completely different non-trade related job.
I know a number of landlords in my area. Some that are the slum type do fit that description. But a number of them are like me. Want a good basic roof. No frills but a solid job. I know the premier roofer in our area and my guy is about 15-20% less than that. I can get cheaper, but thats what I get. Cheaper. DanT
This may be the exception to the rule, but I've got one landlord customer who owns properties in more upscale neighborhoods (mostly 4plexes, some duplexes). When they need reroofing, they get 40 year shingles minimum, copper flashing and gutters. He uses the same approach on interior & mechanical repairs. Appears to work. Tenants tend to stay longer - less time spent finding new ones, less repair calls putting bandaids on bandaids.
On this whole idea in the last few posts, I have always gotten a portion of my work from real estate people and from landlords.
With the RE it is a matter of up front communications and selling the idea and measureing whether they are serios or not. Instead of doing a free estimate, sell a written inspection report that references possible pricing for various solutions.
With landlords - I remmeber once in a small town I did a lot of work for two older sisters. They had married brothers who partnered a business empire there and owned half the town between them. The sisters inherited, of course.
One of theser old gals believed in taking care of her people and property and not charging too much for rent. I loved working for her ( except for the part where I went to present a bill and had to have tea and visit for an hour or two)
The other sister was a cheap old hag. She always wanted to chisle me down, kept raising her rental rates, booted people out for little reason, etc. She ended up losing some of her properties while the other was blessed with expanding borders.
The contrast was amazing between the two.
So I learned not to generalize too much.
.
Excellence is its own reward!
Yeah, this subject of what people spend on their rental units is sort of fascinating. I try to reduce the amount of time I have to spend on upkeep, so for stuff that protects my investment in the building, like roofing, exterior paint, bathroom fixtures, utilities coming in, or waste going out, I try to invest in the best quality I can.
But for stuff I know stands a good chance of getting beat up over the time rented to any particular renter, disposables like countertops, carpeting, interior paint, window shades, light fixtures...I am more interested in utility than quality.
It's amazing to me how many landlords you hear complain about the amount of upkeep they have to do, then make a point of using the cheapest goods and services they can find on those same buildings.
I don't know how you bill. I do over 80% of my work on T & M, so this won't work for me. But if you can bill by the square foot--which a lot of painters do around here--when one of those slimy realtors calls looking for a number, you tell him "$1.25 a square foot for the ground floor, $2.25 a square foot for the upper stories, and $3.25 per linear foot for trim. Per coat. Plus/including materials. Plus/including scaffolding rental. Plus/including prep. 50% deposit to schedule the job."
When he asks, "Yeah, but how much is the whole job gonna cost?" tell him to swing by your office and you'll loan him a measuring tape and a calculator....Dinosaur
'Y-a-tu de la justice dans ce maudit monde?