When I meet with a potential client that I am bidding on a house for my presentation usually goes in this order. Keep in mind this isn’t our first meeting. It’s usually our second to fifth or sixth depending on if we design the house or they had the plans.
1. We look at the final plan. They’ve seen it before during the drawing stages but I want to show them the “final” design. This is only if we designed it or made changes to there plan.
2. Then I give them the price to build the house.
3. Then I go over the detailed spec sheet to show them exactly what is included and we discuss any questions they may have.
I’m wondering though should I be switching 2 and 3? Sometimes I feel like I give them the price and then they just shut down or feel disheartened if it’s more than they expected.
But on the other hand if I try to go over the specs first I feel that they just want to know what the price is, like a kid waiting to open Christmas presents.
How do you guys make your presentation?
Replies
I havn't been in your shoes yet as far as pricing a whole house. but am curious about your post, and the reponses.
One question I do have is, do you talk to your clients or have they mentioned a number that they have in mind as far as a budget goes. earlier in the process?
what I'm getting at is if they give you an idea of what kind of money they will have to work with, are you designing a house around their numbers. and if they are asking for certain things, then you are tlling them if you want this your numbers goes up?
I guess if they simply throw a plan at you, then the numbers will be what they are, depending on specifics.
also, you mentioned , they seemed disheartend. that may be the case , but in your experience, so far has that mattered? I mean have they proceeded with the project? in a any case, I guess people will not always like what they hear. stilll, is what it is, and if they can't proceed because they can't " afford" the numbers I guess it won't make a difference what order you present, but I get what you are saying.
anyway...looking forward to the other responses you get, to see what I can learn as well.
after plans, summarize spec sheet in two minutes or less, then the total price, then go to detailed spec
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On larger projects, I do a lot of homework as early on as possible so I have a ball park figure, at least in my mind. If I feel it is necessary, I'll mention the ballpark figure earlier, (usually padded a bit), rather than later in the process. This should always be verbal. This helps me to "take their pulse", and gets them oriented to where the final cost might land. If we get to the final price stage, I'd present the figure at the same time as the specs., then give them time to review. Schedule a followup meeting to discuss their questions at that time as well. Ideally, the final price will be somewhat lower than my ballpark, not too much lower though. If you are doing 2 and 3 during the same sit down, I don't see how it makes much difference.
If you are presenting both at the same time. why not ask them which they'd prefer, hearing the price first, or seeing the specs first. Tailoring the meeting to their concerns may give them a greater sense of comfort with you.
I speak only from the position of an outsider who has mediated and arbitrated hundreds of construction disputes, not as the contractor. I have heard the contractor's lament many times about how they told the client they were over budget, and the same number of times, the client lament about how the final cost was a surprise. (Admittedly, most of these disputes were post-contract, but I think the lessons apply to your pre-contract situation.)
Please do not be offended if I write things here that you consider to be obvious. I am merely trying to put my suggestions into context.
Most people, no matter how affluent they may be, hate (upside) money surprises. Most people interpret, rightly or wrongly, money surprises as "bait and switch," regardless of the cause.
I agree with the other posts: The client shouldn't be "surprised" by the final number ... If you update the client periodically along the way with reasonably accurate guess-timates, they should be prepared for the final price.
I also agree with the opinion that you should know (as best you can) the client's budget, up front. Each time that the client adds a budget-buster, I think you should inform the client immediately that the request will cost an additional $XXX (approximately) and increase the guess-timated total price to $xxx. Each time you sit down with the client to review the design and costs, you should have the starting numbers, all adjustments up or down based on design changes, and the new guess-timate.
If the champagne taste does not match the client's beer budget, you should tell them in very unambiguous terms. This is not the time to waffle or be vague. Client's always hear what they want to hear, and only remember what they wanted to hear.
On high-end projects, I can make a strong argument for written updates to the "guess-timate," each qualified that prices may be higher or lower based on the final design and subcontractor bids, etc.
If the final subcontractor prices come in above your guess-timate, you should be prepared to explain to the client why you were low.
Lastly, I would change your order as you have suggested. (1) Design; (2) Itemized costs so they client can see where the money is going with emphasis on client's budget-buster designs; and lastly, (3) the total, which should not be a surprise and should not cause the client to "shut down."
Between 1 and 2, I would give a "sectional" price breakdown.
I would select "sections" first on necessary items like foundations, frame to dry in, and so forth, then by those items that can be reduced in cost by selecting something else.
For instance, they originally wanted Sub Zero and imported hand painted Italian tile in the kitchen.
My presentation might go
The idea of labeling the 'sections' into hard costs like the foundation, and soft costs like extravagent materials and finishes is to put the idea that they are responsible for those costs into their
pointy littleheads and reduce their immediate reflexive tendancy to blame you.This would also identify any 'talking points' when it comes to negotiating a new plan.
I wish I were better at getting my thoughts to flow into this dang keyboard.
SamT
Anyone who doesn't take truth seriously in small matters cannot be trusted in large ones either. [Einstein] Tks, BossHogg.
I follow what you're saying. I like that idea to show them the large expense is on their end not mine. I've never been a fan of breaking down "my" costs but I think that works.
We show them a spread sheet showing three levels of quality in the selections and three different prices for the same house including dramatically different cost per sq ft numbers for the same floor plan. then we go over the specs and plans showing them how THEIR DECISIONS will determine the final cost of the house. Then we walk them through the decision making process to get them to show us how expensive a house they want.