Just for kicks, what are your thoughts?
Guy calls yesterday and says he wants a carport built on his house. No plans, no pictures but wants a good cost estimate. He describes how he wants it and all and we talk for about 20 minutes. He lives about 12 miles away so I figured I’ll ride out and have a look in the next day or so. He doesn’t live there as its investment property so he says he doesn’t want to spend too much. I tell him Ok, I’ll give him a fair price reiterating I am not the cheapest but I guarantee he will be happy and can provide references if he likes.
I will ride by and give him a quick estimate but honestly, its going to be a $15k-20k job. Not really all that great.
How do you guys handle things like this?
I want to be able to say “Sorry that job is too small” or “you at least need to have plans before I can give you any numbers” but lets face it, these calls are all I have gotten in the past 7 months (remember I already had to close up shop once and its only not finding another job and one or two jobs that brought me back)
Share your thoughts and no criticsim is too harsh. I want to be able to redo my business and reach a point where I don’t have to “compete” for jobs like this (these in my mind should be givens that customers just call you for and say “Build!” based on who you are but haven’t gotten there yet.
Mike
Replies
Mike, it would certainly be nice to be too big or too busy to take this job, but you aren't in that boat.
Price it fair, do it well and continue to build your new business.
Best of luck.
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Remodeling Contractor just outside the Glass City.
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You've created a competition in your own head. There really isn't one there at all but since you think it, there is one.
You've also created a negative feeling about the job and it sounds like you are already convinced that he's not going to use your services.
It's "only a 15-20k" job and "not really all that great".
I'd say you are doomed LOL!
My sales girl, oops, designor/estimater would be thrilled to chase this job. She'd figure out what the hard costs are on it, mark everything up 67% and give his the price in an enthusiastic tone and tell him "it's "only" $19,876. Before he saw that price, she'd walk him through the eight page proposal and contract and explain everything. She'd specifically mention everything he mentioned on the first appointment. Of course, this proposal would be delivered in person. She wants to look her clients in the eye when she asks when we can get started with a twinkle and smile in her eyes and voice!
The plans would be part of the hard costs on this deal.
We would be thrilled to land this job. It would represent about a weeks worth of work and make the company about 4k net profit and pay the guys their wages.
Bob's next test date: 12/10/07
I would drive 12 miles for a 5k job if we are doing nothing. Price it so you can make money, pay for the travel etc. And be glad to have something to eat with till the next good job appears. When we are booked 3 months or better out I typically add 10-20% to everything. If we are down to a month I start backing up a bit. Never to the point of not making money but certainly not as much as we like. In essence, read Calvins reply again. DanT
15-20k is too small for you? Where are you at? I'll take it.
Family.....They're always there when they need you.
Re.
107972.5 in reply to 107972.1
"15-20k is too small for you? Where are you at? I'll take it"
I dont like your attitude. Thank goodness you are a long way away from me.
You would be the only other guy in town who is busy.
I'll do a $1000 job. (and make darn good profit on it too)
At this point i'd go back to shoveling #### on the dairy farm I once worked at.
Even with that attitude i'm slow, not dead, but slow.
Family.....They're always there when they need you.
Keep the attitude.
the work will come back.
I was dead in March. Now I am quite busy!!
Stay positive and talk to everyone.
Don't ever be embarassed about a price. You need to make a living.
Tell the guy what it's going to cost, and let him decide if he wants to go ahead with the job.
And I think you've been pretty generous already by giving a price based on only a 20 minute discussion.
Are carports even legal there? Not allowed here and they're ticketing people in Kansas City Kansas that built them. Apparently they look tacky.
Mike
I used to run the ops sides of homebuilding companies. I was the big cheeze and the contractors jumped when I said jump. (I treated them well but everyone scurried behind me to take care of what I told them I needed taken care of)
Well times change. Now I go after every $15K job like it is my last. The market SUC*S and you have to earn the business every day, whether it is a $15K carport or a $200K redo.
Follow up and treat the guy like a king.
Plus, you can hammer out a carport in a week if you set your mind to it so what the heck, you might be able to pocket some nice money for a 1 week job.
You will do it right and I am pretty sure he is not going to give you a punchlist.
Just make sure his money is good.
Guys,
Oh, don't misunderstand as I am HAPPY to have any job but when I say "only" I mean that I have already figured hard costs to be around $12-14 so I can't say much more or I won't get the job. Things like the plans and engineering ($2k) and the permit ($1k) eat up so much of these small jobs, THATS what makes me dislike them. I can't afford to run this job and only make $1-2k
And sadly, I don't have anyone to present the proposal with a smile...its just me.
So yes, I like the idea I am just wondering how you can turn a job like this into less of a competiton between you and the five other guys he is calling and win it and still make money.
"So yes, I like the idea I am just wondering how you can turn a job like this into less of a competiton between you and the five other guys he is calling and win it and still make money. "It's not a competition between you and five other guys. It's you, selling your professional services, to him. THERE IS NO COMPETITION!Heres how we would price your job. You said there are 14k in hard costs, including the 3k plans and engineering. We would multiple the 14k by 1.67 and the retail selling price would be: $2,338.00. That's the proposal that we would deliver with a smile and a promise to do a quality professional job. The key to surviving isn't getting the job, it's getting the jobs at a price where you can deliver a quality product AND make a profit. What happens if the price is too high and we don't get the job? That leaves our schedule open for a different job, THAT WE WILL GET AT OUR PRICE.What happens if we take that job below our price? We would have that slot in our schedule filled and have to move the more profitable jobs back? WE DON'T WANT TO MOVE THE PROFITABLE JOBS BACK IN THE SCHEDULE!!!!Your best bet at surviving is the stop trying to get every job and start trying to sell every job AT THE RIGHT PROFIT NUMBER. Bob's next test date: 12/10/07
"I am just wondering how you can turn a job like this into less of a competiton between you and the five other guys he is calling"This is where the type model Mike Smith and I use works.You make your initial sales call selling your self and quality and service before getting into price.You quote a price to do the design and proposal and get paid for doing the design/estimate phase. He needs a design before ANYBODY can build it.Then he is committed - on the hook with you and impressed with you by the time it gets to the price estimate/ bidding phase. You are incontrol of the situation.It also weeds out the tire kickers who are wasting your time. If they are not willing to front design cost, they are not really interested in building legally and safely
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
Oak River Mike,
The last was really good advice.. don't bid it at a price that forces you to earn less than you should..
bid it where you can stay in business.
My only thoughts are where could I cut costs, replace materials with cheaper and provide that as an option? pay lower fees and etc. some how? (one of the guys I speak to on a regular basis has a design service out of Mexico that will send the plans to a printer hooked to a computer).
Plans that would normally cost $1500 to do can be done for $150.00 he used to have a service in India do it much cheaper but everything was metric and a lot of mistakes crept in.. the service out of Mexico seems to be based on actaul building experiance in America..
Frenchy,
Good idea with the plans but its Florida. Every set has to be signed and sealed by an arch or engineer registered in the State of Florida. And no one will s&s unless they draw the plans...
Oak River Mike,
Well then one less area to worry about..
Seriously if you sell yourself and the fact that you are licensed insured and experianced. you eliminate those who can underbid you. Assuming your costs and time are in line..
It's selling and some here don't think much of my profession but it means the differance between success and failure too often to be ignored..
Remember nothing ever happens untill somebody is sold.
I had to do a sales call today, alone. I haven't done one in many, many years. The guy was nothing but budget minded. He already knew all the wholesale prices for everything. I finally told him "you already have all this figured out...why do you need us?" Eventually, he gave me his budget. I promptly told him that I highly doubt that we would be doing business but I thanked him for allowing us the opportunity. Immediately, he started backpeddaling. I basically told him four more times that we most likely wouldn't be able to do the job. He backpeddaled and offered to postpone some of he work. At one point, I told him how he could get the cheapest labor around by advertising on Craig'slist and dealing with one man bands and unlicensed contractors. LOL...I did everything I could to steer the guy somewhere else. I didn't know sales could be so much fun! Bob's next test date: 12/10/07
Blue,
Excellant! What was the tell? How did you know he'd backpedal? Eyes, body language, what he said?
The tell? Hahahaha. Everything! By the end of the conversation, he was basically hoping he'd be able to afford some of our services and he'd just hire us for what he could afford in his budget. I doubt we will be doing anything for him though. We'll give it our normal treatment and do an honest proposal but I really can't worry about his budget or the competition. I have one master to serve...the bottom line and it ain't gonna be red! Bob's next test date: 12/10/07
I always find it amusing to talk to folks like that as somewhere they heard (probably from their brother-in-law who is "in construction") that if you talk money down and act like you know prices, contractors will bow.
One fellow a while back called and up front asked if I had lowered my prices as the industry was slow. I told him just the opposite, I RAISED them as I had fewer jobs to pay for my costs. Nothing on the other end but silence.
I think I should add Mike, that I was very polite when I was telling this homeowner that we wouldn't be able to meet their budget. This gave me the opportunity to sell my services in a backdoor kind of way. I explained that we ALWAYS gave every client our best price but we had the financial realities of the business: insurance, overhead etc. Also, when I urged him to hire the guys off Craigslist, I also explained that we also have hired workers and subs off craigslist and I explained that it was a giant crapshoot even when they were carefully screened. I went on to tell him that I had the advantage because I was bringing in these untested guys but they were supervised by my crew. If something went wrong, we broomed them immediately and fixed their mess. That implied to him that he'd have to do three things: learn to carefully screen, hire and watch them and know when they are screwing up, and fire them and fix everything after they left. Now, when he starts to ponder that scenario, he's got to be thinking...if I hire the wrong guy, and have to fire him, I'll be stuck trying to hire another just like him when the project is already started. That's not a good situation especially because this guy has a tight time frame. So, I agree that you and I need to be aggressive about how we deal with the clients and their ideas of pricing but it's important to use each moment to explain the benefits of using our services. In my case, I was explaining that Texas has a wide variety of semi-skilled workers who might put him in a bind. I made him realize that we also have that same concern but that we've sorted things out already and can also overcome a problem when they arise. When I put myself in his shoes, I realize that he's trying to save money and keep a tight budget. I acknowledged that with him and told him that I understand and don't blame him. He's got his financial limits, just like we have our construction financial realities. I explained that if it doesn't work for both of us, there's no hard feelings...we both have to do what we have to do. I was just thankful that he was giving us the opportunity to see if we could serve his needs. We are closing only about 30% of the leads so I don't mind cutting them loose right there in the opening appointment. Bob's next test date: 12/10/07
I think people should tell the homeowner that if they hire a guy at a low price, there's a good chance he won't show up to do the work.If another opportunity comes along, the other contractor is going to take that job and "blow off" the low paying job.I think it happens a lot.
mrfixitusa
What's worse is he may take several jobs and stretch out the time required to finish them. Putting two of his crew to work on one site and three on the other and try to run between them. Of course one job site might have one carpenter who knows a little and two grunts while the other job site is being run by the former grunts. Lots of potential for mistakes, a lot of unseen shortcuts etc..
Mike - why would you not give two approaches -- one with a truss roof, shingles, slb parkign pad (week of work) and one with a flat roof with EPDM roof that is supported by 6 8x8 pt posts, with a gravel parking pad (day of work) -- shows you want the work and will meet his desire to go cheap or a-little-fancy --
Mike i may be taken to task on this but your wasting your time.
No plans he wants you to come over and design it for free.
Investment Property????? means bare bones cheap.
You gave a price or will????.
No matter what price you give your the easy number to beat now..
I wish i could be more encouraging and i have been there where i had to run in hopes of landing a job.
I like to ask on the phone... How much do you think this will cost?????..
Now heres when i race out the door.
Hello bobby??? this is Mr Jones you did work for our friends and they bragged about you.
We have several jobs that need to be done, When is it convenient for you to come over,.
Mr Jones is calling you while your on a wild goose chase
"Investment Property????? means bare bones cheap."We just signed a deal with a flipper. Not all flippers are looking for low budget unskilled slap it on pricing. Bob's next test date: 12/10/07
bobbys,
This was kind of the feeling I got during and after the phone call but I said I would go look at it anyway. Nothing to lose but time....or that other job. ;)
Mike
I appreciate all you guys inputs but I have to ask, where do you guys work that this would be a one week job?
First off, the permit is going to take 4-5 weeks and then EVERYTHING needs inspected here and each inspection can be a two day delay. Footing, slab, framing, rough electrical, sheathing, roof, final electrical and final. You cannot call in the inspection for the same day so each requires at least one day lead. They "roll over" alot of inspections due to so many inpsectors being cut so if all the subs showed up perfectly (yes, I cannot do the electrical nor roofing myself) this is still a 2-3 week project once the permit gets issued.
Total time would be 6 weeks at the least.
Not whinming just wishing I worked where you guys do! :)
oak River Mike,
Inspections? What are they? Actually you only need inspections to get paid and since I refuse to pay myself anything I don't call for inspections.. <grin>
What you have is an investor not a homeowner. He is not looking for quality he is looking to enhance the property for the lowest cost to sell for the maximum gain. Unless you can sell him that your $15,000 carport will reap him a $45,000 profit the guy that will do it for 4 grand and add 20K to the price will get the job....
Unless of course you want to partner with the investor gaurenteeing some sort of return on investment.
For investors money talks and BS walks.... I'd suggest wearing your sneekers when you look at the job 12 miles is a long walk home.....
Edited 8/7/2008 8:36 pm ET by sledgehammer
You've hit upon the reason that the word 'customer' starts with the word "Cuss."
I really hate it when you get non-answers to questions you ask, or there are other indications that the customer doesn't know what he wants. Sometimes, it just sounds like they're spouting adjectives!
All you can really do in that case is look at how something is actually used, and the actual conditions, and make your best design. Then, rough design in hand, present it to the customer as a package. Sure, you can use it as a 'springboard' to learn what they really want ... and you can even give them a menu of options. The main thing is to get those lines of communication open.
One thing to avoid, however, is giving them anything that they can then present as 'the plan' to either the city, or other contractors. They want that, get paid for it first. Likewise, be extremely clear - meaning vague and broad in scope - that any numbers you toss out are for budgeting, and are NOT a bid or quotation.
When they give the 'go' signal, make sure it's in writing. Prepare decent plans, and get them to sign them. Keep them fully involved through the course of the job, and document everything!
Because, at the end of the job, it is simply amazing how these vague, easy-doing folks turn into sharks, with an exceptionally detailed memory, and a virile sense of outrage, at the way you've "cheated' them.
I don't agree. Until there is a contract agreed upon, no rough design should be penned. I wouldn't spend five minutes thinking about the design. If that guy doesnt care about designing his carport or paying for a design, why should I? I would give him that 23k price though and offer to do the drawings as part of the contract. Bob's next test date: 12/10/07
I's also offer to draw the carport construction docs so he can pull a permit. That's $3500. It might include the engineering on something that simple. Bob's next test date: 12/10/07
"I don't agree.
Until there is a contract agreed upon, no rough design should be penned.
I wouldn't spend five minutes thinking about the design. If that guy doesnt care about designing his carport or paying for a design, why should I?
I would give him that 23k price though and offer to do the drawings as part of the contract."
I love your attitude. Especially "wouldn't spend five minutes..." I subbed for a guy like you and I learned a lot.
Thanks,
Kowboy