Recently, I was asked to bid a large reroofing job (removing slate and installing copper, including box gutter relining). Before I submitted my bid, I was informed by a sub working on other projects on the house, that the company I previously worked for had already bid the job and what the price was. I did not solicit this info. When I got my price worked up, it was significantly higher (30%) than my old companies’. I have lower overhead, so normaly I’m cheaper. The guy that took my job (actually, I trained him to replace me) is a friend as are the owners of the company, so I called him after double checking my numbers and we compaired notes. He had miss-measured.
Fortunately for him, 30 days was 1 day away and he was able to pull the bid before it was acepted. I have not gotten the job (it probably will not get done), since the owner was fishing for a bid lower than the miss-bid.
Did I do the right thing?
Replies
If your former employer is a friend then you did the right thing.
If he was a-hole and desreved to get screwed you just missed a good one.
The potential customers didn't lose anything because TANSTAAFR(R=roof)
And if they don't want you to work for the price you gave them, You aren't missing anything. except maybe the cost of giving them an estimate. Education costs to!
Mr T
Do not try this at home!
I am a trained professional!
I think discussing pricing with a competitor is collusion, which is illegal. (But I'm not sure)
Of course, what is or isn't legal isn't always right or wrong. I don't think it was wrong, as long as you didn't try to "fix" the bids.
I generally wait until AFTER a job is done to talk to a competitor about it, to avoid any pretense of wrongdoing.
Men are Like mini skirts
If your not careful they'll creep up your legs.
You did the right thing, your old boss got lucky too. He'll remember it too.
Joe H
I think you did. Like M.r T said, whatever duties you owe the customer, you don't have a duty to help them steal a roof.
Being sensitive to the appearance of collusion is probably good, but think of it this way. Would it have been collusion if you had sent an anonymous letter with enough detail to convince the guy to re-check his numbers? I don't think so.
I would say you did the right thing; knowing their numbers didn't make you change yours. You did your old employer a favor by helping them find a potentially costly error.
I've been in this situation before and on both sides of the fence. If it was someone in biz for longer than me and a competitor I would keep my mouth shut - friend or not. After the job was awarded and completed then I MIGHT hint that it was a good practice to "X" - whatever would have corrected/ found the mistake.
If this person was new in the biz and my competitor but whom I was mentoring, I might call him/ her on it over a beer - but only after the job was awarded, so he/ she could correct the error in future bids beginning immediately.
The "buddy system" in biz is not the same as at summer camp. What you did was kind and noble. I have underbid (more than most) and would have embraced a heads-up. However it is MY responsibility to be certain my bid is accurate. That is an important part of MY job. Doing your friend's job has now put you in an awkward position. Are you a separate co. or a partner? If the deal had gone his way, becuase he called the Client and was able to come up with a plausible excuse for increasing the bid, you would have lost an oppertunity to get your biz off the ground.
Starting a biz is hard enough. Protecting your competitors is like giving them a leg up - over you. You can't afford it. If you expect to get referrals from him, the refferals should be because you're good at what you do and not because he's too busy due to you saving his butt.
Ethics require responsibility. Other business' are NOT your responsibilty. This is the way you make a living. Your family is depending on you. They are your first concern and most important responsibility.
Edited 2/7/2003 1:01:01 PM ET by Frankie
Twenty or thirty years ago I might have agreed with you Frankie. But you're wrong.
How does seeing his old boss get screwed benefit GreenCU's business or his family?
The guys I used to think of as my competition (and hacks, butchers, thieves, whatever) have survived or failed on their own. Seems like I've mellowed out, but letting someone else get screwed isn't on my "To Do" list anymore.
Joe H
greencu - Well that's a horse of a different color! I did not realize you all still work together in a variety of capacities. If that's the case, you will sleep better with your actions. I think it still might be collusion because your conversation had an effect on his bid, being that he withdrew it.
Mike - When one of my subs bids a job (regardless of under or over) we discuss it. I make sure he/she is comfortable with the numbers and everything is properly concidered. You are right, mistakes found half way through a project serve no one. But, this was not a case of the GC questioning the vailidity/ accuracy of a Sub's bid. It was between competitors. An important distinction. GC's and Subs should be on the same team, competitors aren't.
JoeH - Seeing someone get screwed is not on my To Do List either. I was just making the point that g is not responsible for other companies. I also don't think he necessarily "benifits" from someone else getting screwed. You want to give someone a heads-up - knock yourself out! But be prepared that the other guy could have resubmitted his bid while still underbidding g and g would be out of the game. One last point: As I stated before, I have been on both sides of the fence. I have been underbid by my comp by 10K and they still made $$. Thing is they did the job as cash, or didn't provide their crew with WC or SS or the Gov w/ taxes. Maybe they have a dif overhead or are desparate for cash flow. By contacting the comp you open yourself up to questioning their business practices. If they are tight friends whom you break bread with of share beers then it may be okay. But if they are only competitors let them do their job and you focus on yours.
Edited 2/7/2003 11:41:55 PM ET by Frankie
who cares if they underbid?
Ya give your price to do a job...if someone else thinks/or can do it for less....more power to them.
no one wants the lowest bid customers, anyway.
JeffBuck Construction Pittsburgh,PA
Fine Carpentery.....While U Waite
<who cares if they underbid?>
I don't care if they under..... or over bid. I just care that everything is concidered and included - when I am the GC. Otherwise I have other things to occupy my time.
I think you did what was right a fair to your friend. It just so happened that your friend was your competitor. I think being honest will help you in the long run.
At Darkworks Customer satisfaction Job One..Yea yea were all over it , I ll have it done by next Tuesday Oh yea I need another draw.........
frankie... there are competitors and then there are competitors...
some of those scumbags could die by the phone waiting for me to give 'em a tip.. others ... well, sometimes they work for me, sometimes i work for them.. sometimes we work together..
and what goes around comes around
Thanks for your reply ( and to everyone else). I'm not starting out in business- I left this company several years ago and I really was not dying to get this job. I'm already committed for the time frame this job is supposed to be done in, and would probably end up subbing my ex-employer for parts of it if I got it.
I have six or seven major competitors. In the last two years, I have subbed five of them and two have subbed me. I know my strong points and I know theirs. I have certain tasks that I'm exceptional at and others that I simply enjoy. I'm a good fabricator and have a better shop than some of my competition. Consequently, when one of them gets a big job, I get hired to bend the metal. If I get a large job, I call on some of them to install.
We seldom wind up bidding on the same job, however, and here I felt like I had crossed a line I maybe shouldn't have.
The way I understand collusion, is if we had gotten together before submitting. Both bids were submitted before they were discussed.
Thanks again to everyone who answered. I feel better.
it's a small world......and everyone needs a hand every now and them.....
I'd say you did right. Who cares about "appearance of collusion" except for the way too many lawyers the world has?
It was an honest mistake in the first place...nothing bad about righting a wrong.
I have "competitors" than know my prices......they tend to call me to sub for them!
You might have just help set up a deeper line of trust that'll send more work your way.
Jeff
Buck Construction Pittsburgh,PA
Fine Carpentery.....While U Waite
boss. .... i don't think you can have an illegal act of collusion on a private bid.... on public bids, yes.. but not on private bids..
and not only did he do the ethical thing , he did the right thing..
no bids should be based on errors.. if one of my subs comes in with a bid that is too low, i tell them they should check their figures.. and i'll go over them with them if they want...
it doesn't do anyone any good if halfway thru a project , an error is discovered , especially if it could have been red flagged at the start..
so, bottom line.. if someone i know makes an error, and i can correct it , damn straight i'll give 'em a jingle.. hope they 'd do the same for me
ALL
I think greencu did the right thing
True story/western Montana/early-mid 80's: Nasty reputation extreme greed multi-$$aire with ranch and huge home - screwed neighbors often - neighbor had been very kind to carpenter - carpenter was asked to bid helicopter hanger - carpenter knew who else had been asked to bid - went to the other two bidders and proposed the following: They'd tell him what their bids were and he'd bid way lower, but notify Mr Big$ in writing in the proposal that he could not start until December - way too late in MT winter to be letting your multi$$$$$ helicopter set outside
Greedy neighbor begged carpenter to alter schedule, to no avail. Carpenter plays it for all it's worth and eggs on the whining and begging.
One of the other bidders got the job
Occasionally what goes around really does come around!