Here is a scenario that I have been coming up against a lot recently.
A contact will ask “do you do _______ _______?” In the blank it can be anything from wood floors to electrical to tile work to painting, etc.
My response to date has been to refer them to our trusted subs who do this work. My thinking is that I’m not sure how customers would react if we sent out a painting sub to do their house instead of our employees doing the work. When multiple trades are involved or our employees would be doing a significant amount of the work I feel completely comfortable?
Am I forgetting the advice to “not be afraid of the money”? Are the customers asking me because they feel comfortable with us and just want me to handle the whole job and bill them whatever it costs?
So what do you do when a customer approaches you with an opportunity like this?
Replies
If it's something I don't have time to do, or my crew doesn't have the skill or the equipment, sure, I'll use subs....just remember that whoever does the work, your name is on it.
Sometimes I'll even use one or two of another subs guys....make sure the sub knows about it....do the right thing financially (I'll carry them on my own payroll and W/C)....some guys (and gals) are always happy to get some sidework.
I usually mark up 12% to 15% for those jobs and all the paperwork and billing goes through me.
Same problem here. I refer people to good subs. If they hire a good sub to do the work, there's nothing I can add that makes my markup worth paying. If I were going to do as Notch suggests, and actually hire the workers on my payroll to perform the work, that would be different.
It depends on the nature and size of the job, but generally speaking, I would do everything to encourage your past contacts/customers to think of you as the first person to call for anything they want done. I'm guess that in most cases, it's immaterial to them whether you or your crew does the actual work -- they just want the job done right.
They have faith and trust in your work, but they presumably also trust your judgment -- so if you farm the job out to a sub, they know you are picking someone who is competent to do the work. That frees the customer from trying to find the right person, and that service is where you earn your mark-up.
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"I tend to live in the past because most of my life is there."
-- Herb Caen (1916-1997)
In the past and with the owners permission, I have given their number to a sub and let them get on with it.
Now I am thinking I will treat it as any other job, only I wont be doing any of the work. I will call the right sub, arrange day and time, make sure HO is happy and collect the money.
As my subs do excellent work and are trustworthy, so far I cant see a downside.
Everything, 100% of it, depends on how you look at it.
DW
AJ,Do you ever meet resistance from a client if the job is very small? Let's say a customer wants to paint two rooms.If I have to make an initial site visit, a visit to get the contract signed (I always present in person and at this point do not write contracts on carbon paper or anything like that) and schedule the job the markup has to be pretty good for us to spend the time and assume the risk.My concern is that some customers won't like the upcharge for our services. On the other hand I'm sure there are some that are ecstatic to pay because they trust us and know we will back up any work that is done.
Jon Blakemore RappahannockINC.com Fredericksburg, VA
Jon - You are assuming the risks once you take on the job. You may share it with the sub, but the customer is going to be looking at you when something happens (and inevitably it will). You need to make sure you are financially justifying the risk with your "reward". That reward may be partly the extra $ charged on the job, it could also be in the form of having a broader base of customers. The couple that wants the rooms painted this month could have a daughter or friend in church who is going to renovate the kitchen a few months down the road. The goodwill can go a long way. Even a referral (to another quality guy) can generate goodwill.
I noticed you said you don't use "carbon paper" for the contracts, etc. If you aren't using your computer for the office stuff, you're killing yourself. You should be able to generate as many copies as you need with the push of a button. On small stuff, consider a simple "letter agreement", 1 or 2 pages. I am a horrible typist and the computer has saved me a bunch of times.
Don
>>"I noticed you said you don't use "carbon paper" for the contracts, etc. If you aren't using your computer for the office stuff, you're killing yourself."I do everything on the computer which is why I have to go out to the site a second time to "get the contract signed (I always present in person and at this point do not write contracts on carbon paper or anything like that)"
Jon Blakemore RappahannockINC.com Fredericksburg, VA
Jon,
Big or small, the customer gets a number to do the job. No break downs etc. If they want it done then fine. If too pricey for them, it doesnt happen.
They wont ever know what I make out of it.
I just figgured that once I have taken the call, gone round to see the 'bathroom job' and discovered it is in fact a plumbing re-do, then I should make something for my trouble.
I will get a price worked up, call my plumber and have him go round and do it and send me the bill. I bill the customer. Everybody is happy.
Everything, 100% of it, depends on how you look at it.
DW
AJ in NZ
That's the way most smaller contractors got big, say yes to everyone for everything and you never know where it will lead..
As soon as you say No to a customer, he has to look for a new source.. That new source may do well enough and wind up with the job you thought was yours..
'Sactly................ :-)
Everything, 100% of it, depends on how you look at it.
DW
We do exactly as you do.
Unless there are multiple subs involved or some other reason why we should be involved (such as the homeowner being out of town or out of reach), everyone (including us) is happy with a simple referral.
Exactly how we handle it depends on our past history with the customer. Some customers are so good to us, that we will take care of them for a nominal cost. Most customers already know our regular subs and may use them on a regular basis, without any knowledge on our part. A few customers I steer to our competition, maybe they can satisfy the sob's.