At this point, this is all just thinking aloud (or, in print, as the case may be).
I’ve been thinking about this a lot. Like I guess we all do. I invest a lot in putting bids together. Without a doubt, bidding is the hardest part of being a contractor. It takes experience, time, physical and mental energy, emotion, sometimes even money (gas, blueprint copies, whatever), to put a bid together. And yet, I cannot charge for bids. Because no one does here.
Now, estimates off the top of my head are different. Sometimes I’ll tell people, Well the last one I did similar to this cost $123.00/sq. ft. (or whatever). No charge for that information, let me know if you’d like me to bid it.
I’ll qualify that. On insurance jobs, I do charge to prepare a written bid. And I tell them, the money paid to me for preparing the bid is deductible from my bid price, if they hire me. Because I’ve learned that the odds of me getting hired on an insurance job are almost nil. Often, they need a licensed contractor to submit a written bid to the ins. co., but once the check is in their hot little hands, they’re going for Mr. Lowballer, licensed or not, insured or not. And my price is usually more than the insurance companies want to pay, anyway. ONE TIME someone actually paid me to put a bid together! (they didn’t hire me).
So, I always feel a little taken advantage of, when I spend hours perusing plans, meeting with potential clients, asking questions, answering questions, explaining options, calling subs, meeting with subs, making materials lists, shopping prices at the supply house, crunching numbers, soul-searching, etc. etc. – and I submit my bid, and the h.o. says “OK, thanks, I’ll think about it.”
And that’s it. Sometimes (less than half the time), I get the job. Usually, they hire a cheaper guy, or they already had someone lined up and just wanted to check their price, or maybe they won’t end up doing the job at all. Just change their mind, decide to spend on a vacation, new car, etc., whatever. And guaranteed, after all the time and energy I’ve given them, after all the rapport we’ve built up, they won’t even grace me with a phone call to let me know what’s going on, or why.
So I’m just doing free homework for these people, which aggravates me. Because a bid is prepared in good faith, but many people do not request a bid in good faith. These people are looking for a PRICE, not a CONTRACTOR.
——————————————————
So here’s what I’m thinking. I prepare a bid, as usual, no way around that. Then, I write it down and put it in an envelope.
I meet with the client. I set the envelope in front of me. I tell them, This envelope contains my bid price. Its down in writing, I can’t change it. Now, tell me what price I have to meet or beat, to get this job. If you have any other concerns, lets address them first. I can provide references. I can discuss time frames. I WANT TO DO THIS JOB! I can answer your questions, that’s what I’m here for. I think I’m the man for this assignment.
BUT, we don’t open the envelope, and you don’t see my price, until you tell me what price I have to be at or under, for you to sign a contract, write a small deposit check, and get this job on the calendar. If you agree that my bid, if under $X dollars, is within your budget, and you will sign a contract and write a small deposit check, and we can get you on the calendar as a definite job…THEN I will show you the envelope.
That is, IF my bid is within your budget. Or, IF I’m willing to do the job within your budget. Or, if I can modify the job a little to meet your budget, in a way that’s acceptible to you (i.e., formica instead of tile OK with you?, paint grade instead of stain grade?, etc, in order for me to do the job for your stated price.)
If so, here’s what I figured your bid at, go ahead and look at it, now that we’ve agreed that you will sign this contract, once I make the modifications here to get the price in line.
Or… Great news! My bid is within your budget – go ahead and check it out, and lets get this contract signed, you can write me a deposit check, and I’m putting you on the calendar! You won’t be sorry, I have a great team, and a great track record, and we’re gonna do a great job for you!
BUT, if my bid is not within your budget, and I’m not willing to do the job within the budget you just stated, then it really doesn’t matter what my bid is, does it? – so I won’t waste your time or mine any further. I thank you for meeting with me, and giving me the opportunity to bid this project. I wish you the best with it. I’ll just take this envelope with me, and be on my merry way.
Oh, you say there’s some flexibility in the budget? OK, let’s talk about that. Or if not, no hard feelings. Believe me, I understand inflexible budgets as well as anyone. Have a nice day.
—————————————————————-
So, I’m gonna work on this. I just came up with this out of my head, but I’m thinking its probably not too different from the way new car sales are done. They don’t just throw out a price, they sit down and discuss it. “What price to I have to get this car down to, for you to sign a contract today?”
That way, if they’re serious about wanting me to do the project, and if I can meet or beat their budget, we’re on! If not, then I’m not giving them anything but my time, but certainly NOT my bid price. Well, I suppose, unless they want to pay me for it!
View Image“…everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile.”
Edited 6/22/2009 11:02 pm by Huck
Replies
Well, if you are going car shopping
Go see Cal
http://www.youtube.com/watch?v=QOsLdT4slsk
Approach it from a monthly payment deal. Line up financing prior. 24% interest ought to cover you. Sell the financing not the remodel
But, I like your thinking. The envelope is almost irrestiable. Who could NOT look. Just like poker. You have to know what the guy had
Edited 6/22/2009 10:58 pm ET by Scrapr
You make an interesting case. I will be interested in hearing how this works out. I think that the great buying public has little, if any, idea how much work can go into a bid or a job.
I like it.
You know what your number is. Suppose their number is a lot lower, and you know you can't get down to it, and they will not/ cannot make changes to reduce the scope ... do you still show your number?
"Put your creed in your deed." Emerson
"When asked if you can do something, tell'em "Why certainly I can", then get busy and find a way to do it." T. Roosevelt
You know what your number is. Suppose their number is a lot lower, and you know you can't get down to it, and they will not/ cannot make changes to reduce the scope ... do you still show your number
No. What's the point? At that point, you tell them you just can't do it, but thank them for giving you a chance, and wish them well.
The way I look at it, my bids are always free to my customers. If you're not interested in being my customer (because my bid wouldn't be in your budget anyway), why would you want or need my bid?
If they want your bid, breakdown, etc, of course they can have it, if they are willing to pay for the time spent preparing it - and I can say, with a clear conscience, it will be money well spent.
Again, I plan to try this out soon, but its really just in the thinking stage, at this point.View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
I'm not promoting this for everyone, I'm just trying to find a system that works for me. I've been in this business for 30 years, been a licensed contractor for the last 20. I've just come to the obvious conclusion that I'll never be a "git 'er done, cheapest price in town" kinda guy. Even 'tho I'm practising in an environment where that is the norm.
Here's the thing: we (contractors) are expected to prepare a bid - a fixed price that we will put on the line, and state we will do the project for. Thats a big commitment. OK, I will do that.
But the h.o. has a decision to face also. How much are they willing to spend to do this, and do it right? They can do their homework (if that means get another bid -or bids, OK), whatever they have to do to make a decision - and I'll do my homework, and make my decision. Then we'll meet, to see if our numbers mesh.
My work (remodeling) is varied enough that each project pretty much has to be bid on an individual basis. Some things, like a kitchen gut and rebuild I can estimate with a square foot price. But most projects require a lot of work to actually put a firm price tag on. A decent sized remodel/addition can take hours to prepare, and that might include a certail level of stress, even a few sleepless nights.
I know that there are plenty of contractors out there who do the "low bidder" thing, and that's cool. Its just not me. I'm trying to find those customers who are a good match for me - for my personality. These are clients who want a contractor who does good work, is conscientious, maybe even meticulous to a certain degree (I've been called that - although I do not claim to be, or even attempt to be, a perfectionist!). Who is licensed, bonded, and insured, and who is solvent. Who will do the job well, and will charge enough to be able to do so. And they understand this guy will seldom be the lowest bidder. That contractor is me.
If you are looking for someone like me, then I am looking for someone like you. If you are looking for the cheaper price, there are other guys out better suited for the job.
View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
Edited 6/23/2009 2:49 am by Huck
y'know - sometimes I wish you guys would just accept that darn near everybody wants a "cheaper price" whenever they can get it.
We work hard for our money - and lotsa folks gotta make it go a long ways towards items a, b, c and bills x, y, z.
Paying attn to the bottom line of costs is NOT a sin nor definition of a cheapskate.
Folks here have whole threads about "what deal did you find today"? and post with glee about sale prices found on their Tool du jour.
It's just natural.
I'd ask you to consider that folks want and need to keep an eye on the bottom line but always always always they're buying YOU and if you are a match for them, then they will find a way to give you your price.
ok?
ok
"Is it February yet?"
Two most excellent posts here Miz !!!
Thanks.
I gotta admit I'm torn in 2 directions simultaneously whenever I venture into threads up here above the Tav.
In my dayjob - I am called upon and frequently I am personally requested to sit on Bid Review Boards for Govt projects with Life Cycle Costs in the $1B+ range; due to my background in Project Management in chemical weapons disposal for - what - 12 years now... And I note those technical proposals and bids are in response to listings our agency places in the Commerce Business Daily - and all those proposals are significant work efforts - but their costs are adsorbed by their companies as part of doing and getting business.
THen I go home and try and maintain and fix things - learning from you gents here those things I wish to tackle myself - or have no option but to tackle myself because I can't get a contractor to show up!
and so it goes
"Is it February yet?"
Huck, I know the feeling so well. Although I've only been in business for 5 years or so, I could have written most of that myself. Your proposed solution is certainly intriguing; let us know how it works out.
let us know how it works out.
I had a job I was gonna try it on. Little bathroom remodel. I called to say I have your bid, when can we meet to discuss it? No response. Another time waster!! Gets downright frustrating, if you let it! =)View Image
it absolutely does that!
The hardest part that I have to deal with is that I am constantly trying to educate the client.
This is probably part of where I differ from most contractors around here. My bids are full service, high end, and I try to leave nothing out. In the past, I have told the client that I don't typically have much , if any in change orders/increases. But, that is up to them, not me. I don't low ball either. If they want a lessor price, then somthing is going to be cut and I don't recommend doing so. Because they have already told me what they want.
I am not a salesman by nature, and I tell them that. I also tell them that I work hard for my money and my work shows it. I have referals to prove it.
now, the hard part. In referal cases, my sucess rate is >85%. My cold call is probably less than 25%. These are the ones that I usually have a hard time with anyway. The failure rate is almost always due to low bidders, unrealistic costs. Very, very few are because I missed it by a percent or two.
Welcome to California, where low price is king!
No. What's the point?
Here's what I would do: Follow your plan, and in the envelope are two pieces of paper: one is a detailed or semi-detailed breakdown of the costs so you can show how you got your number. The other is just the bottom line. After they reveal their budget, say it's way low, open the envelope, show them your numbers and whay they are higher, and leave them with the total-only sheet. Maybe it has the scope of work too. Then if they get other contraftors to present prices, they will have your name and number as a reference point.
On the other hand, after you show them your detailed proposal, it might lead to a discussion about the scope and details, and you might get a modified contract."Put your creed in your deed." Emerson
"When asked if you can do something, tell'em "Why certainly I can", then get busy and find a way to do it." T. Roosevelt
Huck,
I guess one problem is being in California. I fortunately can offer a design contrat and capture the client to the building stage. If they already have plans then I ask them to meet me on an ongoing job and point out things I do others don't . If they won't go to one of these jobs then you've called their bluff and they are checking someone else pricing. I added a trick one of my JLC peers said..look em right in the eye and tell them they can trust you with their money. Remodeling is , after all, one of the biggest rip off games played. The few who can do it right are often the ones who hate being a salesman.
I like it.
You will have be careful, of course, to present it in a very friendly way. But, if you can pull that off, the idea sounds dynamite.
Keep us posted on how it works. We might wanna plagerize a wee bit....lol
Naive but refreshing !
You know - there are OTHER things that do happen to folks (the old "shid happens" syndrome).
An example.
I contacted couple of outfits to try and get bids on some work. One showed up quickly - I liked the dude well enough - his price seemed a little high - I told him I was seeking to collect 2-3 estimates and make a decision.
Contractor #2 never showed.
The monsoons of spring arrived instead.
contractor #3 showed up when I was out of town
Mom had 2 back to back heart attacks in one month...
I end up outta the state for weeks on end - months go by.
I finally come up for air - gave up on concept of collecting more than one estimate/bid - and called contractor #1. Told him was ready to move out if he still wanted the work I had funds at the ready. He gave me lukewarm response - told me to call him when I was ready to do something? I told him I just had; and asked if we needed to re-meet to go over the scope of work and estimate again? He said he'd call me when he was in my neck o'the woods.
Now - Am I a schmuck of a customer because I originally wanted to try and get more than one estimate for some work that I have NO background at doing myself?
Am I a schmuck of a customer because I had other situations delay my returning to this planned project because it fell off of my top 10 "things to attend to" list for a few months straight?
Maybe.
Maybe not.
I'm just saying. Sometimes your potential customers are not being schmucks - they're just dealing with "STUFF" that happens to them...and by extension - some of that happens to you by bleedover effect. But that doesn't mean anybody's being disingenuous or uncourteous or anyother adjective ya wanna add onto this here sentence.
"Is it February yet?"
Not at all. Say we meet, discuss your job. I put together a bid for you, and we sit down. I say my piece, you tell me you are collecting two other bids. I would ask, Are you really just looking for a good contractor, who does good work, and who can do the work within your budget? Do you think it would be possible to make that decision tonight?
Let's say you want someone like me, and might even be willing to pay a little more, if need be, to hire me. But you don't want to pay a LOT more, and don't want to make a decision until you have a reference point (meaning the other bids). I think that's OK too. I'd say Get your other bids - then, based on those bids, decide what number is the absolute tops you'd be willing to pay to hire me. Maybe its the same as your lowest bid, for that matter. Whatever it is, you decide what it is, then call me, and we'll sit down. Tell me your price, and I'll have my written bid in an envelope. If its in your budget, we're in business. If not, well, at least we tried.
View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
Edited 6/23/2009 3:00 am by Huck
huck---- I don't think your proposed method is a good idea
1)-- it's very confrontational-- not a good way to start out
2)---- it puts HUGE emphasis on the price---the very thing you want to avoid
3)-- I have every confidence you do excellent work----but how do I KNOW you do excellent work?- Certainley OTHER contractors do excellent work as well----and might be prepared to to do the work for less than you------- so you can't fault the consumer for looking around
4)- you mentioned in another thread that you think with your heart--and I think with my head---fair enough---that's the way you are--let it show through.I think you have to get in front of the customer---and let your care and enthusiasm for the project show through. If all the contractors in your area act in manner"A"( free estimates)-- there is a definite market for you to act in manner"B"---- your proposed method is overly confrontational---and sabatouges what presumably would be your main selling point-----your care and craftsmanshipgotta run
stephen
What is needed (and I still haven't figured it out yet) is a foolproof way of screening the customer before taking the time to bid.
It may sound that way, but does it have to done that way? I'm thinking not.View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
You wrote: "I say my piece, you tell me you are collecting two other bids. I would ask, Are you really just looking for a good contractor, who does good work, and who can do the work within your budget? Do you think it would be possible to make that decision tonight?"
But the underlying premise that doesn't work is this - sometimes when I'm collecting bids/proposals/quotes - I am trying to find out what it is going to cost to get something done. In other words - I've not yet established a budget because I'm not yet knowledgeable about the costs afffiliated with the SOW (scope of work) so I'm seeking the pros' feedback to determine that.
Now - I've had cases where contractors show up for other items I'm thinking of having done. Had case last year where first guy showed up and started spitting tobacco juice at my feet, then swapped to cig's and dumped them on my yard everywhere we walked. As an ex smoker, I NEVER treated other folks' property like that. So while I appreciated the $ he was citing, and made mental note of it - I wasn't inclined to do business with him. NExt gent showed up few days later - he was clean, courteous, made a good mix of chitchat and down to business discussions. Then he cited me a price $100 above the first dude. I asked him: If I pay you cash, can you knock a C note off that price? He looked at me for 2 seconds said - "and do the work this month?" I said "yeah - asap per your schedule!" He said "OK" and we shook hands. He called next morning, showed up, got the work done and I paid him in cash.
So even when I don't exactly know what budget I'm faced with for a task - I am prepared to find out what's a "going rate" round here, and make a decision and close the estimate/proposal portion quickly.
It's just sometimes things don't work out that smoothly.
"Is it February yet?"
sometimes when I'm collecting bids/proposals/quotes - I am trying to find out what it is going to cost to get something done. In other words - I've not yet established a budget because I'm not yet knowledgeable about the costs afffiliated with the SOW (scope of work) so I'm seeking the pros' feedback to determine that.
that's the reason I titled the thread as I did - you are looking for a price, not a contractor. The only work you want done at this point is the legwork involved in pricing, and while its difficult enough that you wouldn't attempt it yourself, you are looking to get it done for free, under the guise of a "bid". So my scenario should work as planned, from my viewpoint. Once you decide on a budget, and are looking for a qualified contractor to do the job, call me. Or not. =)View Image
I think Shredder wants both a price and a contractor.
mizshredder,
I certainley understand that life gets in the way sometimes
however----I also know that in 21 years in this business less than 5 people have called back to tell me they are going with someone else. I don't think you are a schmuck------but is EVERBODY in your situation?- they certainley act as if they are.
stephen
in 21 years in this business less than 5 people have called back to tell me they are going with someone else.
I had one do that the other day.
On the other hand, I've had many tell me I had the job, they just weren't ready to start yet (Mom had a heart attack, the dog yacked on the carpet, what ever) only to drive by and see the job finished a month later. Their pants were on fire.http://www.quittintime.com/ View Image
Stephen,
121606.15 in reply to 121606.7
"mizshredder,I certainley understand that life gets in the way sometimeshowever----I also know that in 21 years in this business less than 5 people have called back to tell me they are going with someone else."
Did you want them to? I admit I've not ever done that but would happily do so if I understood that's a courtesy you guys would appreciate? (Just like I'm one of those rare people who gives POSITIVE feedback to CSRs at retail entities, and online, when behaviors warrant positive comment).
I don't think you are a schmuck------but is EVERBODY in your situation?-
Although I don't know everybody, I would say that at some point, every body on this planet has to deal with the issue of an ailing or dying parent. It's more a matter of WHAT is happening to any individual, at any point in time. Sometimes you're just never really going to know. Dont' take it personally.
they certainley act as if they are.
Really? Then perhaps the ones you've encountered - ARE. Quite the thought, that.
"Is it February yet?"
Thats about the same here, I might point out though in Roofing it only takes 10 minutes to come up with a price as days with remodels. I went for a long time getting sub bids and presenting detailed estimates only to have the phone slam, After awhile my subs would not want to bother, They dont want to go over plans for price shoppers either. Funny i gave bids then asked if i did not get the job what the bids came in at. Then its a state secret. Ok for them to wave my bid around but i guess its not OK to tell me even if i lost it{trying to get future reference}
Bobby,
it typically takes meabout 1-1/2 hours counting drive time each way( 8 blocks, lol.)you can bet your house that if it took much over that----- I would be doing it EXACTLY as mike does BTW-- I note that Mike is in rhode Island--- one of the Few states with currently a higher un-employment rate than Ohio---California ain't even on the list so----- I figure if Mike can do it in Rhode Island-----it can be done anywhere
stephen
After years of roofing once i get to a house i measure it and it takes just a few minutes to figure it out, I useally sit on the roof and check my messages or gaze over the neighbor hood as if i go to fast they think im not taking enough time, What takes the time is im a big BSer and do tawk to much but its not all bad , If they tawk i know weather there good people to work for or not, So im interviewing Them, If they say things like they threw the last contractor off the job or dont go on the evil neighbors yard flags go up. I have been known to ask the neighbors if there good people or call other contractors to see if they got paid.. I know the bid but sometimes dont tell them right away i may tell them i have to go home and figure it all out. Whats hard for me though is that a lot of homes are vacation homes and i never even meet the people so if there getting bids its just numbers i dont have a chance to sell myself, Like you i can point to any house in any given neighborhood and tell them i did 2 houses on there block, That helps.
I think you might be over-estimating the importance of a "budget". Yes, many people may think about having a certain project done provided that it's less than a pre-determined amount, but I don't think most people approach their wish-lists that way.
I think most people get an idea in their head and then without giving much (or even any) consideration to cost, start bringing in contractors to see what it would cost. Then, once they know what it would, they re-visit the decision as to whether or not they want to proceed.
If I'm right, then your idea is just putting people on the spot and would make them very uncomfortable.
most people get an idea in their head and then without giving much (or even any) consideration to cost, start bringing in contractors to see what it would cost. Then, once they know what it would, they re-visit the decision as to whether or not they want to proceed.
true, that's part of the problem. They just want to see what it would cost. So we do their homework for them. If making a commitment to an acceptable price makes them too uncomfortable, I will never get the job anyway.View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
"So we do their homework for them. "Honestly, how do you expect them to do their homework.What resources do they have to find a price?Just look at any question asked here about cost for a project.If you have some handy way for people to get a price RANGE for a job without asking a conctractor.And I am not even talking about an exact cost. Even a guestimate of +/- 25% is hard to come by..
William the Geezer, the sequel to Billy the Kid - Shoe
"So we do their homework for them. "
Honestly, how do you expect them to do their homework.
What resources do they have to find a price?
You missed it. Their homework is to pick a budget number they can afford. What this project is worth to them. I think a schoolkid could do the math, but so many homeowners won't.
-----------------------------------------------
They want to know how much to do the project? I can generally give them a very rough ballpark estimate based on a verbal description. You don't think anyone has friends or family or workmates who have ever had work done on their house? You might be right.
Like the guy who called me for a room addition. Said his budget was $4K. I told him we could probably get a slab poured, and wait until he could afford the rest. He wanted the whole thing for that price!View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
Honestly, how do you expect them to do their homework.
Yeah, like how in the world could anyone decide how big of a room addition they want, where the walls and doors will go, etc, without a contractor working for free, holding their hand through the options/decisions stage.
Oh, and choices. What floorcovering do they want? What appliances? Finishes - tile, granite, marble, etc.? People can't make these decisions without a contractor holding their hand? We have to volunteer our "free" time to give a bid, and then walk them through the options and wait for them to make decisions?
Come on.View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
I know that I have spoken with my last real estate agent, and the next time I step foot on an insurance job- I'm turning around. Learned my lesson on both counts.
(Potential) customers expect the information for free. I hate it too, but do not have a solution as no one else seems to charge for bids.
Those customers focus on a number, yet do not know about or do not care about the details behind that number. Sometimes, trying to explain is like pulling teeth... I can almost see the eyes glaze over. Other times, even after the customer understands (or seems to understand) why hiring the low bid person is bad... they still don't call.
I have a great deal of time invested in some bids/quotes/proposals... whatever you want to call them. They are on the computer... which makes it easier to keep some blocks of information the same... and it is becoming faster and easier to generate the paper the customer needs.
Your envelope idea sounds interesting, but I think putting the client on the spot then and there will backfire more often than not.
Some people will always be interested in just the number, and not care about the how and why of it... and search for the lowest one.
If you think you can get people to pay for quotes/bids/proposals... go for it.... never happen here. That would be the fastest way for me to lose almost all instead of some potentials.
I don't have an answer. If you come up with one, let me know.
For now, I will focus on getting the jobs I can do right... and keep fixing the lowball stuff later when it doesn't work.
:)
Getting several bids is your perogative .
If you tell me you are getting several bids i naturally move on to the next potential client as it seems most people wave the first guys bid to see if the others will beat it !
The fact you had several personal problems andhe did not hear back from you he probally moved on to other potential jobs
Also sometimes you catch a contractor when he needs a job to fill in a empty slot and he may have given you a good price wanting your business at that time
At the moment he may have a vumber of jobs lined up and isent so keen on yours so the shoe is on the other foot
This spring i helped a lady in the purchase of a home in a nearby town
She was calling me nearly every morning at 7am and discussing all the pros and cons
I helped her to write up the offer and on the counter bid saved her a few thousand , i did a home inspection at her request & allowed her to tell the bank i was doing the work (thats what she told me )
The deal went through and she gave the job to her brother !
Now she is calling me for the roof portion ( the worst part ) and leaving messages
I am busy now ( couple of months of work ahead ) so now i dont bother to call her back as the shoe is now on the other foot & i charged her nothing for my previous efforts , now you see the other side perhaps ?
I find most contractors around here are quite fair to their customers and as a result their previous customers stick to them like glue
ive had some of the same customers for over 30 years and all of my dealing with them are nearly always verbal
The number of contracts i have signed could be counted on my fingers with spares
The woman i mentioned above would of been a first timer but i have known her for 20 years , she does house cleaning and one of her best clients is one of my oldest customers ( i got her that client ) so as i say " lifes a bitch then your dead " LOL.
My challenge in this neck'o'the' woods is they know I'm not a native the minute they hear my voice on the phone. ANd if I don't have a name to drop of somebody we're both related to or church attended etc, I'm hard pressed to get some of them to even SHOW UP.
I've listed to what you guys post here and have even specifically stated on more than one occasion (like last summer's high gas prices time): "I know your time is valuable and gas expensive, I'm willing to pay for you to come estimate the job" and I stopped saying that after about 3 times had the dudes say IMMEDIATELY "oh NO, that's not necessary" like I was some nut job.
So there's some geographic disparity - cultural "ways of doing things" that change from place to place in the country - and I'm still trying to make my way thru that morass here in central AR. (please remember I've lived in about 12 US states at some point or another in my life so it's a process repeated over and over of what goes over ok in locale A, doesn't always do so well in locale B).
ah well
"Is it February yet?"
"why hiring the low bid person is bad"I always chuckle when I read this type statement.If you get three bids from the three best guys, one will be the lowest.
bobl Volo, non valeo
Baloney detecter WFR
"But when you're a kibbutzer and have no responsibility to decide the facts and apply the law, you can reach any conclusion you want because it doesn't matter." SHG
What the homeowner hopes will happen:3 bids within 5-10% of one another in which all three of the contractors make the same recommendations, build the same way, get same materials from the same place. Furthermore, all three contractors are great guys with 30 years experience and 100's of references each. The HO just chooses the cheapest guy and moves forward.What really happens (from my perspective):3 bids with three prices that aren't even close. First price is unbelievably low but what the HO wishes he could get it done for (or even less). Second price is twice as much as the first and more than the HO wanted to spend. Third is 30% higher than the second. One guy (doesn't matter which one) is 22 yrs old and shows up in a brand new rig, another is 33 and showed up in a rusty old pickup, the third drove a buick?, All three have different methods they suggest to build the project and all recommended different, I mean totally incomparable, materials. They ALL say they have 1000's of references. Also, usually, one is an elegant talker who sounds quite educated, another is gruff/to the point and ready to attack the project, third is funny and boisterous but not highly educated sounding. HO is confused, feels like the high number bidders are taking advantage of him but is scared to go with the low bid so he thinks about getting more bids, thinks about not doing the project or doing it himself calls the high bidders to see if he can wheel-an-deal, gets mad, calls the low guy to do the work but the low guy says he missed something in the bid so the price needs to be much higher. HO gets more mad. HO Goes with the middle guy whom he already offended by trying to nickel and dime lower. Its sorta a game to some people.DC
Am I not supposed to arrive for an initial meeting with the homeowner in my Buick? If I only need a tape measure and a notepad, why drive across town in my 14 mpg, manual-transmission truck when I can drive my comfortable 30 mpg car?:-)http://www.moritzcarpentry.com
What happens if the three bidders are requested to bid on the plans, specs, and scopesheet docs that were prepared for the owner by a design pro?
Furthermore, the three bidders were prequalified, in that they were asked to provide references before coming to discuss and pick up bid docs, they were asked if they had time to bid the job, were asked whether they would actually bid it if asked, were asked if they could perform the work in the approximate timeframe needed, and their references checked out.
Couple of things in the scope, just typical stuff, the cabinets are all called out to be Brookhaven "Mission Two," and that cab line is available from two well-know dealers in the area. The siding is called out to be Hardiplank Cedargrain 7.25, 6" exposure, blind nailed using SS ringshanks, factory finish color specified, one coat SW (type and color specified) applied in field after. These examples may have errors and typos in them, but the real specs are good, tight, clear, and complete.
The specs go on like that, so that the bidder has little or no opportunity for making substitutions. All materials specified are readily available from local sources.
The owner took the time with each bidder going over the scope docs and answered whatever questions arose at that time.
Describe the scenario now, after all three have bid.
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"A stripe is just as real as a dadgummed flower."
Gene Davis 1920-1985
".....Hardiplank Cedargrain 7.25, 6" exposure, blind nailed using SS ringshanks, factory finish color specified, one coat SW (type and color specified) applied in field after."Often specs like that are just a dream, other times they become nightmares."All materials specified are readily available from local sources."Maybe in New York or California, but here in MI where lumberyards are going extinct unbeknownst to architects (who probably get their ideas from NY publications) many products must be special order if they are spec-ed so precise. I am sure the other contractors here can offer a myriad of stories about having to hunt down a certain spec item or otherwise how the spec caused them to perform a task backwards or upside down. Not saying specs are bad....but it seems like good (useful) specs are rare.DC
So everything is so bad in MI that nothing at all is available, right?
Legitimate builders have no commercial sources at all for building materials, millwork, plumbingware, lighting fixtures, etc. Right? They rely on barter and garage sales for their sourced supplies. Check? Total pot luck. Sounds bad!
Sounds like a post-apocalyptic scene to me. Cormac McCarthy's "The Road," chapter one.
Let's say the design pro is from Novi, MI, has been in the biz for quite a while, does work as far up as Petosky and Torch Lake, and knows her stuff. Her head is not in the clouds, she understood clearly the client's budget situation, and the materials in the job are all readily available. Even a couple places in Howell can get the fibercement she specified. Sure, it's special order, because of the factory finish, but what is the big deal?
So what is the doom and gloom situation now?
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"A stripe is just as real as a dadgummed flower."
Gene Davis 1920-1985
"So everything is so bad in MI that nothing at all is available, right?...........Sounds like a post-apocalyptic scene to me."Whoa, hold on there. I didn't mean to make it sound that bad. The fact is that many lumber companies and contractor supply houses have closed down. Lowes, HD, and Menards are often the only options for supplies. In fact, in my local area, HD is the only place to get lumber and most other supplies. It's not as dried up as your over blown thoughts of it but it is dried up enough to cause some concern."So what is the doom and gloom situation now?"I never declared anything to be doom and gloom, just more difficult. When pricing special order items I have to pass the time and hassle along to the client. Special orders usually take 10x more time to find, 10x more time to price out, 10x more time to get to the jobsite and on top of that I have to depend on others to get it to me when they say they will, I have to hope that everything is delivered as advertised (and I don't need to go back and order a special install kit), I have to make sure the item matches what the archi had in mind ("oh, I thought it was going to be all metal contruction!"), I have to order just enough or extra because it would cost me too much to re-order and wait, then before I can install I have to read all the special instructions for recommended installation, finally I have to insure that the item chosen by the archi will work properly or it's on ME to replace it. I have to do all this for each specialty item and I have to do it, or at least think about it and put a price on it before I even get the job! Oh, then there is the times when I go through all the trouble to price all this special junk out but nobody else ever imagined that it would cost so much ("wha....$75 per tile?). So it all goes back to waiting for the designer to make a new selection before I can start the process over again.Architects have it easy. When someone calls an architect, they know they are going to pay a lot for a little; when they bring in the contractors to bid they expect to pay the least for a lot.DC
Similar here in many ways. Terry Lumber is gone. Stock Building Materials is gone. Haywards Lumber opened, then shut down, all within a year. All that's left is 84 Lumber (a joke) and the Big Box stores. Of which Lowes is all right, and Home Depot seems like they don't really give a rat's a$$, even in these slow times. The customer is last on their list of priorities.
My client picked out a formica countertop at H.D. the other day. They had something like 20 in this particular finish - but no end piece to finish off the end. Have to drive across town 15 miles in the opposite direction to try to find one at another store.
Between his indecision, and their poor planning of inventory, it takes 5 trips to buy one little (6') piece of countertop. And time is money. Some of those trips were wasted because at first he picked out a special order item. I went in to order it, and found there is only one employee in the whole store who can do it, and you have to plan your visit to the store around that employee's work schedule. And of course they didn't tell him, when he inquired about selection, that a $66 dollar countertop is $250 when you special order a different color. So then were back to square one, and I had to meet the client at the store yet once again, as he went through the process of deciding on a "acceptible" finish. He finally picked one that he doesn't like, but will accept. And I've wasted untold hours on a little countertop.View Image
Gene,
In the last ten years that I have been building in Austin, I have yet to have a set of plans handed to me that had even close to a complete set of specs. I have been given at least four sets of plans that did not even have sections or measurements-just lines of the floor plan-all done by licensed architects and they were signed and stamped.
That is the reason I just started doing design/build. There was no way to do an apples to apples bid on this projects. Everything was TBD or no call out at all.
I had one commercial remodel that had a decent set of specs and we bid it by spec and then did some value engineering and saved the owner $200,000 and got the project.
That is what I run into every day.
Bruce
"Its sorta a game to some people."yes it is.but statements like about low bids always have a bunch of assumptions that go along with it, that are usually never stated.
bobl Volo, non valeo
Baloney detecter WFR
"But when you're a kibbutzer and have no responsibility to decide the facts and apply the law, you can reach any conclusion you want because it doesn't matter." SHG
One problem I see is you are still putting all the same effort into preparing the bid - no time or work saved there.
You are hoping that your presentation method will close a higher percentage of bids, but I don't see that happening in any sizable way.
You are still preparing a price for the same customer that may be looking for a price rather then a contractor.
What is needed (and I still haven't figured it out yet) is a foolproof way of screening the customer before taking the time to bid.
I've heard all the arguments for charging for a proposal, but it won't work in my market. Way too many contractors advertising free estimates. I am able to generate most of my work from repeat customers or their referals, so I am a little better off in my closing rate.
I've had very poor luck trying to get a customer's budget prior to my putting together a proposal. The closest thing I have been able to do is have suggetions at the ready to cut costs. Sometimes, just having alternate pricing has impressed the customer enough that even when the progect has to be drastically rewritten, they have more faith that I am being honest with my pricing.
Terry
huck.... couple things...
prequel.... i don't do bids.... i prepare Proposals
1st.... ("no one charges for bids here" )..... well, so what... you're not "no one, you're huck
2d..... you're assuming you are not the only bid... i always assume i am the only bid..... maybe my assumption creates the reality... but most of the time.... i wind up being the only bid
if my Proposal is above their budget..... they increase the budget, or we reduce the scope
did I send you one of my Proposals ?
times are tough.... competition is fierce.... last three jobs i did not charge for a Proposal..... one was a referral from the neighbor next door.... i knew i was getting the job and i didn't need a fee as a qualifier..... signed that one last night
2d was a previous customer ..... i will sign that one up this week
3d was a Project Manager on multi-million dollar projects...
his scope was beyond his budget.... we reduced the scope and changed it to phased construction... we'll sign up phase 1 next week
now ... about the fee....think of it as a qualifier... if you can sell the "Proposal Fee"...you can sell the job.... if you can't sell the Proposal Fee........you were not getting the job anyways...so move on
and .... never offer to give back the Proposal Fee....that's part of the test... if you "give" it back... it means you didn't need it.... and it devalues it......OR...
it means you are going to give it back but you've added it into the cost of the job anyways...so it's dishonest to say you'll give it back
we're bidding job # 26 for 2009
Mike Hussein Smith Rhode Island : Design / Build / Repair / Restore
Excellent and concise. I like the thinking on not giving back the proposal fee. Customers almost always think like this. Those who aren't never do.Great job in this building/teaching stuff. And I love the building/managing pics!!!dan
Mike, I admire your work and your business model. But we are in two vastly different markets.
I used to work in the Ventura / Oxnard / Ojai / Camarillo area of So. Cal., and while only a couple hours drive, it was worlds away. That area was much more like yours, in terms of the types of jobs and mindsets I encountered. In fact, from your photo threads, I would say the contractors I learned from operated very much like you, for which I'm thankful.
Where I'm at now is so different, that nothing that worked for me there works here. I guess you'd have to be here, to understand. Its different here.View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
OK, you guys brought up some good objections. I still have to spend time preparing the bid. It might come across as confrontational. The h.o. might be uncomfortable, being forced to reveal a number that they would accept.
Sooo, (still just thinking aloud), what if I explained up front - I will prepare a bid and pin down a budget price for me to do the job, if you will pin down a budget price that would be acceptable for you to hire me. We can meet again, you bring your price and I'll bring mine.
Its the "just curious how much it would cost" people I don't like giving a written bid to. Those jobs just never happen for me. The two best jobs I've had in the past year or so were with people who had a pretty definite budget number in mind already - they were serious about doing the job, and had given thought to how much they'd be willing to spend. In both cases, we had a little give and take juggling on some of the details and finishes, but we met in the middle and arrived at a contract amount that was acceptible to both parties.
I have spoken with both, its been some time since the jobs were completed, and both are still very pleased with their new space (one a kitchen, one a bath).View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
One of the first questions I ask during the phone interview is what kind of budget did they have in mind for the project. Some of the objections I have received from the client answering that question are:
Objection 1:
Client: " That is your job to tell me the cost of the project. I'm not going to tell you what I want to spend"
My response:"The reason I ask is to make sure you have a realistic cost in mind for the scope of work we just discussed. A remodel of that sort usually runs between $XX and $YY for me to complete. If your budget is in this realm, then it makes sense for us to get together and develop a design and final cost for the project. If your budget is not, I would be happy to meet to help you get the scope of work to meet your budget.
Objection 2:
Client: " I have no idea what this type of project would cost"
My Response: "We have complete these types of remodels with ranges between $5000 and $100,000. There are lots of variables. What do you think the most you would like to spend on this project is? We can develop a scope of work to fit that budget.
Objection 3:
Client: "I know how much this project is going to cost-I already have three bids-I want to know what you will charge"
My response: "Since you have three bids, may I ask what your primary selection criteria will be and do you have a complete set of plans specifications for the project?"
If cost is the single factor in their decision making process, I know I will not be cheapest so I bow out gracefully.
Just some thoughts based on my experiences of avoiding wasting time with dead leads.
Bruce
excellent information - thank you!View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
Huck,
I can't add a lot of wisdom to the post but will share what I do. During the initial meeting I ask all the pertinent questions, sell myself, then explain to them: I do not give estimates, I prepare a Specification and Cost Analysis, which has the detailed job description with a fixed price quote of what it will cost. There will be no surprises, you will know exactly what the project will cost.
Do a search for Sonny Lykos, he posted on here and JLC about his "Process". Good information.
I get referrals from online lead services, so everyone expects "free estimates". After I set an initial appointment, I e-mail with a confirmation of that appointment. In that e-mail, I let them know they need to have a budget in mind. Unfortunately, not many people want to share this information.
I think you have some good ideas, keep the brainstorming going.
Mitchhttp://www.freewebs.com/glenndalepedalplane/
huck... everyone tells me that " it's different here"
but truth is people are pretty much the same and american culture is fairly universal
you want to play russian roulette with your "sealed bid"...
i've been on both sides of " sealed bids" both as the bidder, and as the government official receiving the bid.... all it does is level the bid numbers
the successful bidder can stil be incompetent, they can still be shysters, they can still have a strategy of bidding low and getting it back with Change Orders
shellbuilder hit on part of it... doing Design/ Build will separate you from the herd
it certainly is our forte'
but at least half of our work doesn't really require "design" our Proposal system still locks them in
i don't care what economic level you're operationg in.. the customer YOU are looking for is looking for a RELATIONSHIP...
giving "free estimates" is not going to attract that customer..
where do you take your truck for repairs ?
who do you call for a plumber?
how did you pick your insurance agent ?
do you look for relationships in the people you do business with ?
if so... then place yourself on the other side.. how can you attract customers who want a relationship ?
it's NOT by using the same business model as "everyone else "
now think about this
suppose you decide that for jobs in the $3K to $10 k range your are going to prepare a Proposal for say $300
next job you go on..... have the initial meeting... get all their wants and needs listed.. then tell them
"OK.. i understand what you want to do.. and i will go back to my office and prepare a written Proposal, to do that I get a fee of $300, half now, and the rest when I present the Proposal"
if they liked your spiel, they will give you a check for $150.. if not they will say "no thanks"
if they say no thanks... you're done.. you don't have to waste any more time with them or their project.. you can move on and devote your efforts to the next call
if they say Ok... as long as you treat them fair, woul will have pre-sold the job and you can bid with confidence...
or you can continue to try and compete against all the other contractors advertising " free estimates "Mike Hussein Smith Rhode Island : Design / Build / Repair / Restore
OK, I respect you, so I'll go through this punchlist here. First, I can't respond to what "everyone says", so no comment there, other than to say, Please try not to judge my comments by what others have said.
People are pretty much the same and american culture is fairly universal - but the contracting / business environment here is as different as night is from day, compared to the Ventura coastal area I came from (which is probably similar in many ways to your area). I guess I can't convince you of that - you would have to live here and experience it for yourself. I don't want to put a lot of energy into why that is so, all I can ask is that you believe me, or at least, don't post a response based on the assumption that I'm wrong. I'm not.
I never said anything about a sealed bid. I said it was a written bid.
I take my truck to a local mechanic who is not cheap, but whom I know to be thorough and honest - qualities more valuable to me than low price. He specializes in restoring antique cars, but does general mechanic work also. My plumber is an associate I have known for twenty years. Again, he is someone who's work and business ethics are above reproach. My insurance agent, on the other hand - I really don't recall. My wife or office girl (when I had one) probably had something to do with that decision. There is really only one worker's comp agency in the state, so that one was a given.
Obviously, by my initial post, I'm not trying to attract customers who want a relationship by using the same business model as "everyone else ". But if I said anything like "OK.. i understand what you want to do.. and i will go back to my office and prepare a written Proposal, to do that I get a fee of $300, half now, and the rest when I present the Proposal", that would be the end of it, right there.
I do not advertise " free estimates ".
View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
Huck, you are a talented contractor and artist. The expectation of 'not' getting what you ask for might come from your own experiences with those you select to work with and have work done by.Whenever I fail to sell or market myself correctly I find it is because of my own thinking. The process always, always, follows the thought. This is a wildly changing environment for doing business and only those who are changing into professionals will survive. You are not only a survivor but a leader in the field. Go forth and win new customers and don't bother with those who don't appreciate the level of your expertise. Be well; have fun...
dan
BTW, I believe everyone charges for estimates and quotes. Call them what you will, but where they are factored into your business model means that they are paid for.You may have to determine the value, of your time, but pay for these we do. Any buyer of any service or goods.dan
Thanks. Marketing is not my forte, but I'm working on it. Trying to find a system that works for my personality. Anything you post here, a few negative types will try to pi$$ on your thread with their hackneyed insults lacking any real teaching or imput, its always nice to hear a positive voice in the crowd. And I do get boatloads of good advice and constructive criticism here, lots of talented people are willing to share and teach. I love this place!View Image
This is terrific advice for the individuals who are having 'Marketing/Sales' problems.More asking for money, if you are ethical, will never hurt the relationship btw Builder and Customer. Stand proud my friend and teach, teach, teach...
dan
What is your "normal" operating area, Mike? Give us a feel for your territory, by saying the average drive time from home to one of your jobs.
The reason I ask is that you may be operating in a relatively small market, where word of mouth travels well. Furthermore, you have been operating in that market for twenty years or more. A superior reputation in a small market is a great combination.
We've friends and relatives in various spots around Chicagoland, a great big metro market. No one there that we know of has ever had a contractor seek to charge for doing a proposal. Admittedly, that data base is small.
But few of those experiences had by our contacts there, were for design-build scopes, something you specialize in. Combine design-build, great and long term reputation, and small market, and you are even more special.
Your method just may not be possible for Huck, simply because of who he is, what he does, and where he is.
Huck's described scenario, in which clients are often taking competitive bids, suggests something different from design-build, something for which the clients already have a design, and drawings and specs. I'm guessing that you don't "bid" work where the drawings and specs are done and zipped pretty tight, and that if you do, you find it hard to charge for a proposal for a scope like that.
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"A stripe is just as real as a dadgummed flower."
Gene Davis 1920-1985
even from the "customer" point of view, I agree with you on this:
and .... never offer to give back the Proposal Fee....that's part of the test... if you "give" it back... it means you didn't need it.... and it devalues it......OR...
Just stick to the concept that preparing a proposal is WORK
Getting paid for work is a valid concept.
the end...
"Is it February yet?"
mizshredder------I think it would be a spectacular line of coincedence if every one of the THOUSANDS of roof proposals I have written in 21 years----involved a prospective customer whose parent died during the process----- a pretty spectacular string wouldn't you say?
stephen
but not every one of those THOUSANDS of written estimates provided by you, ended up in no call backs or jobs - right?
So I'm not sure what point you're making since the scenario of "stuff happens" that causes delays in callbacks or customers committing, only applies to a subportion of the population of potential customers you see and provide bids to, to begin with.
"Is it February yet?"
I think it would be a spectacular line of coincedence if every one of the THOUSANDS of roof proposals I have written in 21 years----involved a prospective customer whose parent died during the process----- a pretty spectacular string wouldn't you say?
Man, you must be really hard on other people's parents to be killing them all off like that ;-)
I notice some people fall over when i give them the price!!!!
Hopefully you have a personal injury rider on your insurance to cover that... head injuries are expensive to treat!
I notice some people fall over when i give them the price!!!!
That's funny. I notice the same phenomenon at work in my presentations! Kinda reminds me of a line from Father of the The Bride. Fronk (Martin Short) hands Steve Martin the bill in an envelope, and says "Don't open this for a few weeks", or something like that.View Image
Had a potential client approach me about bidding on a job
He had gone to the building inspector and got the names of a number of local contractors whom he submitted his requirements in writting to ( trouble was he dident really know much about construction ) At the time i thought it was a neat idea to get a contractor A red flag went up when he told me the work that needed to be done inside the house could not be shown to me because the current home owner hated him and wouldent let him inside the house again till after closing ( hed reported him for not having a permit for the back deck sunroom to get the price down ) While were talking in the laneway in comes another contractor so i asked the proposed owner what was going on and he told me he wanted all the contractors to be there at the same time so they would bid on the job and the lowest man gets it
I explaned to him that i wasent interested in that game & where he could file his papers
My business has no listing in the phone book so i tend to interview anyone who wants work done
Due to not beeing keen on new customers i probally turn down as many as i take
About 90% of the people i deal with are women and they are fussy and usually only have a rough idea of what they want so i spend a lot of time with them to clear things up ( have one currently that has gone through 5 archetects for a addition so far)
By spending time with current customers i rarely get into the bid syndrome
I had a former customer approach me for the second time this week as he is selling his house and the buyer wants work done by someone reliable in the community & is coming in from Montreal Sat 2 pm & would i meet him IN the mean time i was offered a job renovating a condo 25 miles away at 3pm & would i please go look at it ( buyer is a former university student who worked for me for 4 years & is now moving up the food chain ) unit cost them $ 285 . 000 and they are looking to invest about 50,000 in reno work im told by his mother also a customer
Being a full service renovator i find cuts out a lot of the bs from jobs
i often deal with current & x police officers who are quite extreme in their attitude & rarely have any trouble with them but they dont waste words so i dont believe you could be any worse to deal with you just need someone you can rely on & trust
I sold a lot to a officer last year on just a hand shake ( he is im told 5 from the top in our national police force ) he told my lawer where he was from a hand shake was a contrack so quit screwing around & give him his title ( it was a touchy scene to say the least)
You find a good GC stick with him & thus avoid a mental breakdown
Bye i gotta go to work & best of luck in your quest !
"...so i dont believe you could be any worse to deal with you just need someone you can rely on & trust"
BINGO!
"Is it February yet?"
that's funny right there!!! :>)
wanna know the harsh truth?---- I have had a few die 6 months or a year after I did their roof-----and about the second thing to enter my mind was" that's a warranty I don't have to worry about!"
stephen
gene ... last time i bid tight plans and specs..... the job went to a guy who didn't meet the specs... they had a 4 month completion date with penalty
they waived the completion date....
so much for tight plans and specs.... it's a game... and i ain't playing
my golf partner still bids architect's work... they never win..... the job goes to someone bidding below cost.... just another gamerMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
We understand perfectly, Mike. But somebody has to do that work that the architects crank out.
To each his own.
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"A stripe is just as real as a dadgummed flower."
Gene Davis 1920-1985
What is needed (and I still haven't figured it out yet) is a foolproof way of screening the customer before taking the time to bid.
yeah, still working on that one.View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
There is a foolproof method for handling this. Get paid for the work you do.If you cannot get paid for the work you do, then don't do the work.That means your proposal needs to be much faster and looser if you are going to do them for free, perhaps with a "stage two" refinement after the initial bid is accepted with caveats and a deposit, for you to lock in a "real" number. Basically, you need to separate estimates from quotes. Estimates are easy. Quotes are hard. Estimates can be free. Quotes are not. Part of the Estimate should simply be identifying the things that would screw up the estimate significantly. Estimate could even be a range from best case to worst case, with a few notes on the kinds of things that would change it from one to the other. If you're going to provide something of real value for free, then you're going to keep getting mad at people who "take advantage". But they have no way of realizing the value of what you do if you don't charge. If you are doing work at a level that no one around you wants, then you need to move, or change the level of work you are doing.-------------------------------------
-=Northeast Radiant Technology=-
Radiant Design, Consultation, Parts Supply
http://www.NRTradiant.com
Edited 6/23/2009 7:21 am by Mooney
my brain does that in the morning sometimes too!View Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
I apologize.
I wrote an answer but erased it .
Mike has a successful business model and I disagree with him. I dont work for the public anymore but I hire work done . They dont charge for estimates here either . I would not pay for a written proposal. But Mike is speaking on your behalf by telling you how to separate yourself . Im actually agreeing with Mike too. Crazy huh? As long as we are speaking on your behalf and not mine . So Im gonna tell you a story on how its not done here .
I got into the rental business which took me away from what you do. I needed a business plan that worked . Im a pretty strict landlord and dont get caught up in excuses and stories. I knew the money I had to have for a nice product but no one was charging that much. That was my first problem. I have always bought houses that are about 4 to 5 years old and put them back into new condition except the obvious roof and such. They still look new. I get a premium for that product because it doesnt have competiton. You sell a nice place and you need a nice place to rent . Im the guy. I charge more than anyone in town and it dosnt bother me one bit because they arent going any where and finding better unless its freak accident . I got the reputation from the realators . That was one of the most successfull keys to my business I didnt even figgure on. Every agent in town will tell you Mooney has the nicest rentals in town. Its now a calling card so to speak. So and so said to call you and ask if you have anything because you have the nicest rent houses in town. So the stage is set and they send me referals all the time . One agent I laugh at what he said was ; "Tim has the best houses in town but he aint cheap." Dead sure of it I figgure they expect a nice house with a high price ATTACHED . They still come and I tell them before they sign the lease that I evict in 5 days after being late if we dont agree to arrangements. No pets and all my houses are non smoking and Im full up with people still calling . So Im sure Mike is right . Dead sure of it if you can separate your self . Im just a tight #### myself. I dont want to pay enough and I charge too much.
"I dont work for the public anymore but I hire work done. I would not pay for a written proposal. "I am guessing that you are getting estimates from "basic trade" people. That would be ones like roofing, carpet install, concrete drives, etc.Which is what Steven and bobbys does. And it is much different from a remodel, addition, or new house. Which is much, much different in what it takes to do a proposal.As a customer I am willing to pay for a proposal, if I feel that I am getting something out it. That can be plans or detailed specs. But it is information that I can, but does not mean that I will, use if, for some reason, I decide not to continue with that contractor.But I would never pay for an proposal for a bid on a roof or other basic trade unless it was something unusual such as I wanted a bunch of options or there is some difficult problem that needs to be solved.Now I just got estimates from 4 roofers for a new roof. When I call I asked for proposals for replacing a roof. None asked for any fee and I would not have paid for any.I just got an estimate from a tree guy.He was highly recommended and when I talked to him I like what was saying about what and where it would trim. And after he gave he his price I immediately said OK.Now on the other hand I getting ready to do a furance(s) and AC unit replacement. It has lots of complications and What-If's. I see at least 4 options. And that is after I already computed the loads. But, while I think that they are accurate, I will listen to their recommendations.Now after I talk to them and then I think that they are listen to me and understand my needs and concerns and and I think that they can come up with workable solutions and they want a fee to doing a proposal I am fine with that..
William the Geezer, the sequel to Billy the Kid - Shoe
Over in Woodnet I also posted my comments on HVAC load software.One of the persons, who is an HVAC contractor in TX, said that HVAC contractors in his area are starting starting charge for designing the ducts and sizing the equipment. Too many people are getting that info in estimates and then finding somebody that can do it on the side..
William the Geezer, the sequel to Billy the Kid - Shoe
Bill----- let me ask your opinion-----
you mentioned that ordinarily you wouldn't pay for a proposal for a roof---- lets assume it's a standard 30 square ranch Tear-off and re-roof with 30 year dimensionals would you pay for the following---
1905 house---tile roof---needs repairs in several areas---- existing tile is out of production( hasn't been made in years)-------- but he repair needs to be done and it MUST Match-----would you pay for THAT proposal---keeping in mind that the tile must be located SOMEWHERE. how about----- you have an older home(let's stick to the 1905 vintage)----slate or roof----- needs repaired---- lets say a problem on a dormer---you live out of town----you can't even GET someone to take a look at your problem--then you call me.--would you pay for a proposal under THOSE circumstances? thanks-- i am really interested in your opinion.
stephen
I am not close it enough to either one of those situations to say what I would do. Again I want to know what I will get for my money. I don't pay several hundred dollars to just get back that you can't find any matching.I first want to know what you know about such a cases. Not just being able to to tile roofs, but have done working trying to match.Now if you said something like I have several yards that I know that have old tile, and several forums where help match up tiles. I also have contacts with people that can custom match old tiles, but I will warn you that it can be very expensive. I will also check on new tiles that while not match exactly could be used to replace the of the old tiles in a location in the back of the house. Also finding ones that have a similar color, but not the same size that does not match exactly, but could be used on a dormer and then use those on the dormer to do the repairs. And to do this I will need to get exact measurements of the existing tiles and how many are needed. Also take one as sample and to use for matching up.For that I hope to be able to give you several proposals for different options to repair your roof.Yes, I would pay for that..
William the Geezer, the sequel to Billy the Kid - Shoe
Let's examine the situation that exists when a couple want to do an addition to their existing home, and instead of seeking a design/build contractor, look first for a qualified designer or architect to work with them to develop a comprehensive set of plans and specs for the work.
My brother did this a couple years ago, hiring an architect, and working with the archy until he had a really good set of construction docs on which to take bids. He was able to successfully contract the job to one of the bidders, and everything went swimmingly.
None of his bidders asked for a fee for preparing their bids. Each contractor had been asked to quote on the exact scope as described in the con docs.
I am not an architect, but I do plans for either new work or remodeling, pretty much like what my bro had his architect did.
Here are three small part-page snaps from a set of nine 22x36 sheets that describe the work scope for a kitchen addition to a house. Not my work, but similar. This is typical stuff gotten from a competent design pro. In addition to the drawings, which schedule out all the cabinets by manufacturer codes, hardware, and more, there exists a five-page scope sheet describing all finishes, products, selections, and the nitty gritty of the demo scope.
The homowners were able to do all their selections with the help of the 3D walkthrough renderings provided by the designer, who convinced them to get as much on paper as possible, selections-wise, so as to be able to effectively bid out the job.
Whaddya charge to bid this?
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"A stripe is just as real as a dadgummed flower."
Gene Davis 1920-1985
i'd charge about $300.... and i'd come highly recommended
Mike Hussein Smith Rhode Island : Design / Build / Repair / Restore
as has been stated... preparing bids ( Proposals )..... takes time... and time is money
it took me about 20 years to develop the nerve to ask to get paid for my time
i've heard the scuttlebutt around town.. i think i've been described as "expensive, but worth it "
so.... the prospective customer has a choice... pay a fair fee... or take a passMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
I dont believe in paying for proposals . Im all for Mike getting it done . Salute, atta boy.
Ive done several goverment bids that took a lot of time . I knew going in that it was a bid. One time my bid even got opened and they let another contractor match my bid. No one gets paid for turning in goverment bids that I know about .
I think it goes with the business.
I got asked a question one time why I didnt pay more money to this employee. Since you asked you deserve an answer. Because I can replace you for the same money.
As long as people are doing the same service for price C , Im not paying price A for the same thing .
Unless things are not comparable . Then all the rules change . Ive had the only piece of equipment in town that would do the job. Theres one tree guy in town that has ALL the equipment . None else comes close. He gets all the big jobs and the hard ones because hes set his self apart from the rest. That guy is worth paying money for an insurance bid or what ever he wants . Thats what IM saying . I rent new houses to people that need a nice place to live after selling their home . No one else is doing it but me . If the guy sets himself apart from the rest then he can demand . If he cant , hes like Cool Hand Luke with out a hand .
Tim
I dont want to pay enough and I charge too much
...another guy I'm not looking to do business with!View Image
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121606.91 in reply to 121606.48
I dont want to pay enough and I charge too much
...another guy I'm not looking to do business with!"
Thats surely true . Its also true its the way of life . Otherwise Walmart wouldnt have been successful. Its funny to me all the people who gripe about walmart shop there as well. In the old days people didnt shop where they disaproved. Ive heard old merchants drive that scheem for years. Walmart wont make it because they dont have personal service like we do.
Its also interresting to examine the stores that have stayed in business that set themselves apart from Walmart and remained in the hunt . Theres a few people that want quality, or specialty. There should be some people that offer it as well.
Theres a lot of ways to separate . The two best individuals I ever saw in my own home town was a politician that never lost a race running locally and a real estate broker. Ive always thought their mind was on selling 24/7 and Im not alone in my thinking . Both have exceptional people skills and memories. They are both highly motivated and high strung.
Tim
Thats surely true . Its also true its the way of life . Otherwise Walmart wouldnt have been successful.
That's a weak argument.
I don't shop at Walmart, and its not my goal to imitate or emulate them. BTW, if you recall, Walmart grew successful with an entirely different business plan. Then Sam Walton died. He's probably turning over in his grave right now.
Substandard workmanship and disingenuous sales pitches are the way of life, too. Does't mean I'm joining that club.
If walmart is your business model ideal, methinks you should be looking for a website that focuses on inferior products made with third world slave labor, pricing to undercut the market, and cut-throat business practices.
Fine Homebuilding is a whole different direction. View Image
Theres no argument there. Not for me .
Ive studied business plans for a long time . I think its interresting .
No Im not like walmart . I have a specialty product . Ive got the only game in town with what Im doing . Still my bottom line is made by being high on the selling side and tight with out going . No excuse necesary. Thats solid business. Im not a tradesman for the public so I dont sell labor like I explained before. This thread got into business plans which IM always interrested. Im flipping two houses and a cabin right now working every day doing remodeling which is my specialty while my rentals are paying the bills . I think IM at the right site .
Tim
I have seen in the news that Walmart is starting to get a lot of new customers. People that where shopping higher scale in the past.And they have noticed this and want to keep them. So they are upgrading some of their merchandise. .
William the Geezer, the sequel to Billy the Kid - Shoe
I enjoy threads like this. They make me evaluate and look at how I do business.I find that I differentiate between estimates and quotes.Estimates are always verbal and for the quick ballpark price or vague scope of work/ specs. And are said something along the lines of; “A similar project I have worked on cost x amount. Some of the differing factors that will affect the price are…†And I end the conversation making sure they understand that cost x is not the amount and as more details for their project come in then I can nail down a price.Doing a quote is when I sit down and spend the time going through the details (figuring out the ones that builders always seem the have to do), hunting material prices, sub price and doing the math I thought in high school I’d never need. And this becomes my price I use to bid on the project.I never charge for an estimate but do sometimes for a quote, depending on the project at hand and the time needed to put the quote together. Clients with projects of that scope can afford to pay (I always credit the price paid for the quote back into the project). It is a matter of selling them on you. In short you need to say my efforts are valuable and from the start I want to give you the best I can. Make them understand that this is part of the cost design and preconstruction. At this point I am working for you and need to be compensated for it.
Most of the time though I get those low and mid range project with tight budgets where I can’t charge, the quote takes to long to figure out and the lowballer ruins my day.
All very well said!I especially agree with this:"In short you need to say my efforts are valuable and from the start I want to give you the best I can. Make them understand that this is part of the cost design and preconstruction. At this point I am working for you and need to be compensated for it."and this:"Most of the time though I get those low and mid range project with tight budgets where I can’t charge, the quote takes to long to figure out and the lowballer ruins my day."Finding the right point between a job that necessitates a quote charge and one that does not is the difficult part. However, it sometimes happens (35% of the time maybe) that a small job with a low/lose quote leads to a large job with a high/lose budget. The next hardest part is being able to tell when a small job has the potential to lead to a large job. If I were better at that then I wouldn't mind losing money on so many small jobs as I seem to do so often. DC
I know that most people are being forced to live on less money than before or they have lost money over the recent past . Fixit is doing the same flipping IM doing and its working but its goverment loans . No one has any money is what I keep being told so if its not goverment loans its dead in the water. I think everyone here is shopping at walmart but we were never a fancy pants area anyway.
Ive noticed mechanic shops doing well fixing cars they werent fixing before . Thats the most noticeable step down Ive seen . Thats the way it used to be when I was growing up. You didnt "think" about buying a new truck. Your mind fell on fixing the one you were driving .
Tim
SkillsUSA is in town this week.http://www.kansascity.com/703/story/1276161.html"Some jobs are in greater demand because of the recession. Kansas City Kansas Community College Technical Center last year started a major-appliance technology program to teach people to repair refrigerators, washing machines and other big household appliances.“When the economy’s chugging along and everybody’s got disposable income, people think of appliances as a throwaway item when it breaks down,†said Jake Carmack, the program’s instructor. “But when there’s a downturn, people are more likely to repair it rather than replace it.â€Five students were enrolled in the program’s first year. All have found jobs, and one is entered in the national SkillsUSA competition.Two Whirlpool Corp. executives at a booth at Bartle Hall hope similar programs sprout up around the country. “We’re here representing the industry and hoping to convince more colleges and vocational schools to add a major appliance technology program,†said Craig Parks, Whirlpool’s regional market manager. “There are major shortages in many parts of the country for service technicians. If we don’t have a technician in your area, guess what? You’re going to have to wait for service. It’s not a good place to be.â€"And the article also had this sidebar."Wanted…
The Top 50 in-demand occupations and the need for employees from 2006 to 2016. Among them:Registered nurses 1 million
Police officers 243,000
Electricians 234,000
Construction supervisors 178,000
Plumbers, pipefitters, steamfitters 157,000".
William the Geezer, the sequel to Billy the Kid - Shoe
I like it!
One little fly in the ointment however is you (and the potential client) has to be sure apples are being compared to apples.
For example, I work closely with an excellent homebuilder whom I always recommend to my all my clients (I'm an architect). With a recent house my homebuilder guy came up with 350K. Well another builder had 335K. The client said to my guy "If you can match the $335, we'll go with you". Well upon a closer look at the numbers, cabinet allowances were different by about 8K and the 335 guy had no landscaping budget, almost making the two bids equal.
So how do you analyize with a potential client a number sealed in an envelope?
But like I said, I like the idea.
Runnerguy
I dunno, its just a thought. But the reason your price is in the envelope, is so that you can't revise it up if their budget is more than your number (seems to be everyone's fear these days).
Its really kind of a chance to sit down with them and see if they're serious or not, and see if you can work with them in a business situationView Image"...everyone needs to sit on a rock, listen to the surf, and feel the ocean breeze in their face once in awhile."
cambriadays.com
Well upon a closer look at the numbers,
That's why I always have my archjitect look at the proposals, and then we compare notes. Sometimes one of us will see something a little different."Put your creed in your deed." Emerson
"When asked if you can do something, tell'em "Why certainly I can", then get busy and find a way to do it." T. Roosevelt
A lot of what you describe is unavoidable as 'businessmans' risk."
It certainly helps if the customer knows what he wants, if he is serious about getting the work done, and has the money available. And yes, there are those who abuse the situation, play games, or simply waste your time.
As an example, a previous customer contacted me about dividing a retail space into multiple spaces. I spent a good three days researching the types of businesses he wanted to put in the building, and had numerous 'sit-downs' with the guy.
Alas, the guy decided to go with an unqualified party (as in not licensed for the work he proposes to do), whose plan is patently inadequate.
Now, it was impossible for me to quote the job without having some sort of plan. It was also necessary to explain to the customer just what I proposed to do. The information is there, should the hack wish to use it.
What the customer did NOT get was anything that could be filed with the city. For that, he needs a properly licensed contractor.
Is the customer, or the other contractor, playing dirty? Perhaps. That's one area where participating in a local trade association can help. Belonging to such a group makes it a lot easier for the job to be monitored, and brought to the attention of the proper authorities.
Again, in this instance, the hack has already 'made an impression' on the relevant parties; they know him from previous jobs. It's just possible that this particular job will be what's needed to shut him down. Even if he survives, he will likely have learned a little discretion in who he screws.
As for the customer .... I have little sympathy. Sure, money is tight for all of us - but that's no excuse to cheat. At the minimum, his expectations are unrealistic. You can't get even a Chevy at a Yugo price - nor will a golf cart reach highway speeds.
If I have sympathy for anyone, it is for the future tenants. As it now stands, they will be leasing quarters that are simply not adequate for their businesses.
As a homeowner who sometimes hires contractors, I would not accept that arrangement. It's too much like the sleazy tactics car dealers use.
I understand your concern and frustration. I also understand the HO desire to get competitive bids. I often get three bids and get wildly different pricing and solutions to the problem. In talking to the contractors, I get better insight into what might be the real solution to the problem. Typically each contractor will understand part of it, but none of them will have the whole picture.
What would work for me is a "ballpark quote". If you can talk to me for 30 minutes and tell me my job will cost between $15K and $20K and tell me generally what you would do, that would meet my needs and minimize your time commitment. If I'm thinking this is a $7500 job, I'll know that either my estimate is way off or you aren't the guy for the job.
FWIW, on a recent job, I got bids of $2500, $12,000, and $16,000. Which one do you think I hired?
Sorry, no I did not hire any of them. None of them fully understood the problem. The high bids were from "chain" basement waterproofing contractors and were clearly overpriced - they estimated 2 man-days of work. The low bid was from an independent who did not understand the problem. I ended up hiring a PE to do the design work and a general contractor I had used before to do the work.
Reading through this thread brings much to mind but it all seems to boil down to having good people skills; I am personally still working that out for myself.
Overall, I feel that a sealed bid is still impersonal even when presented in person. I try to be as personal as possible during the estimate/bid process.
In doing so, I make sure to ask the client questions pertaining not only to the project in mind but also about their knowledge base of the project, industry standards, contractor business practices, and about their lifestyle habits. I want to know exactly who I am dealing with and in turn let them know who I am. Through this method I begin to better establish a working relationship to develop trust and understanding. They must trust that I am who I say I am; not the other guy who may declare that they only produce the highest quality, always have the lowest price, and can do anything/everything. I usually end up at least educating the client on a general basis: "this is the most economical rout but this is the better way and this is why".
When beginning to talk about dollars, I rarely ask about budget because in the past when I have asked I got poor results [lies]. If you say "how much were you thinking" they say "$1.00" and laugh to steer around it. Press them further and they may get scared. Instead, I inform them about how serious I take the bidding process. I let them know where I see potential problems, what often missed bid items may be, how I am firm with my price because it is very precisely derived, and how I may not be the cheapest price if they are just shopping.
Lastly, and this is something I often brag about, I am just really good at giving on the spot estimates. I put off making a contractual bid for as long as possible by giving estimates that I am confident of or otherwise uncannily can come close to in the actual bid. On average, my estimate is within 5% of the actual bid. Essentially, giving a better estimate has saved me loads of time/effort and by the time we are ready to contract a bid, the number is pretty well nailed down.
My point; easier to invest your time into getting to know your potential client than to crunch numbers.
DC
it all seems to boil down to having good people skills
amen to that!View Image
Hi Huck,
Reading over your idea leaves me with....wow he's really thought this out.....and wow he's had a lot of his time wasted........
As I continued to contemplate this I climbed out of my little box and here's what I'm really seeing in your post....."I understand I won't get every job and I accept that I'll prepare bids and never see a dime. I can not accept that there are people that will intentionally use me and I haven't figured out a way to figure out who's who."
Based on this I would focus on a personable easy quick way to cut to the chase. Something like....."Hey, folks it's nice to meet you. You called me because Mr. Smith told you about my firm and he loves the project I did for him last year. I gotta tell you, in a way it's sorta of easy money.....because I love my job so much it's like I get to go off to play every day and I do play hard, I play to win! But like everybody else I still have to pay my bills. Listen, the last thing in the world I'd ever do is somehow intentionally say the wrong thing to cross somebody but I have to level with you. In this business I get so many calls that all someone's looking for is a price. Something they can shop with and if that's what you want I can give you a quick run down sheet that'll cover most everything you need for a shopping price. But if this is a project you want done right from start to finish for a price that fits the quality standards you deserve then I'll delightfully spend the necessary hours to put together a detailed project list just for you. I can assure you that I won't be the least expensive but no one is more dedicated than I at producing the finest results available. Again, I want this job and will earn this job but if you're simply shopping right now, let me give you a quick list and we'll both be happy. I'm here to serve however I can."
Gotta be your words, gotta leave them knowing you want that job but leave them knowing it's no hard feelings......easy out.....if all they're doing is shopping.....and smile with eye contact a lot....but if you use this approach....you'd better be that good with the approach and your work!
Pedro the Mule - Mama taught me to be nice, Granny taught me to be direct
....."Hey, folks it's nice to meet you. You called me because Mr. Smith told you about my firm and he loves the project I did for him last year. I gotta tell you, in a way it's sorta of easy money.....because I love my job so much it's like I get to go off to play every day and I do play hard, I play to win!
But like everybody else I still have to pay my bills. Listen, the last thing in the world I'd ever do is somehow intentionally say the wrong thing to cross somebody but I have to level with you. In this business I get so many calls that all someone's looking for is a price. Something they can shop with and if that's what you want I can give you a quick run down sheet that'll cover most everything you need for a shopping price.
But if this is a project you want done right from start to finish for a price that fits the quality standards you deserve then I'll delightfully spend the necessary hours to put together a detailed project list just for you. I can assure you that I won't be the least expensive but no one is more dedicated than I at producing the finest results available.
Again, I want this job and will earn this job but if you're simply shopping right now, let me give you a quick list and we'll both be happy. I'm here to serve however I can."
LOVE IT! - ThanksView Image
hate to say it ,but i'd tell you to just keep your envolope,if i wanted to play the price is right i'd go on tv. i'm not going to tell anyone to the dollar what i want to spend,home improvement,cars etc. when i was selling cars the worst thing a customer can do is say " i have 5k what do you have?or i want a payment of 400 a month."let me assure you i could fit you in a car,might be a 3k car but at 5k you got what you wanted.
i'd be much less offended for you to tell me it was going to cost ####$ or 1% of the bid to write it up.
maybe i'm odd duck out,but i don't do anything with a firm"budget". maybe most people do. but really i never get into anything that doesn't cost more than i thought. when i buy lunch tomorrow i hope i can eat for 5.00,at 10.00 i'll pass and eat supper early! signed alwaysoverbudget
YOU ONLY NEED TWO TOOLS IN LIFE - WD-40 AND DUCT TAPE. IF IT DOESN'T
MOVE AND SHOULD, USE THE WD-40. IF IT SHOULDN'T MOVE AND DOES, USE THE
DUCT TAPE.
I like what you wrote. I'd also tell him he could keep his envelope.
I'd also tell him he could keep his envelope
I'm not your kinda contractor anyway - don't build for saps! =)View Image
keep your envolope
Not really looking to do business with anyone that is always overbudget anyway, I try to avoid them folks (bad planning skills!) =)View Image
"I meet with the client. I set the envelope in front of me. I tell them, This envelope contains my bid price. Its down in writing, I can't change it. Now, tell me what price I have to meet or beat, to get this job. If you have any other concerns, lets address them first. I can provide references. I can discuss time frames. I WANT TO DO THIS JOB! I can answer your questions, that's what I'm here for. I think I'm the man for this assignment."
It sounds hokey to me but I understand that this is some raw brainstorming and you are looking for some refinements in your technique.
The problem I have with your approch is that you aren't willing to stand up and state that "I am the best VALUE". Instead, you are instantly stating that you are willing to be the lowest bidder in a bidding war. Do yourself a favor and look around the next time you are out on the road. Do you see all Yugos?
If you see all Yugos, then you are most certainly residing in an area where everyone shops for only price. But, if you see any more expensive models, then again, you can be assured that there are buyers that shop for VALUE. Yes, they spend more but they also expect more.
Therefore, I think a better approach is this. Keep your number hidden and make your presentation. Remember, never discuss numbers until you have established the value. Your presentation should establish the value. The number is almost an afterthought. Now, with your number hidden, ask this question: "If money was no object, and you could choose the best contractor without worrying about what that would cost, have I adequately presented you with enough evidence to choose us?"
If they answer affirmatively, you then have a basis for an agreement. The numbers discussion will become a series of compromisis....some from you, some from them....if their budget is less than your proposal. In any event, if you have presented yourself and your firm properly, you'll have the inside track to win the business.
Thanks Jim, I always learn from your "sales oriented" approach. I'm just a student here! - HuckView Image
You know, Jim, I don't really mind going for "low bidder" - but only in a situation where I'm bidding against legitimate licensed insured contractors with a track record.
If its "anything goes", lowballers, unlicensed, uninsured, cash under the table crew, etc., I don't even want to waste my time bidding it.
I really do best when the client tells me they want to hire me, levels with me about their budget, and lets me work out the best possible job I can give them for the price. I've had some really nice jobs that route, and turned out beautiful too.View Image
Huck, I don't mind going low either. It's simple economics...I'd rather have the crew working that sitting home. The difference is that I'm fully anticipating the sale, at full price, as I make the presentation. After the price comes out of hiding, I can tell by the questions and responses how the deal is going. Sometimes it's a no-brainer and you just have to push the contract, with the number, across the table....THEN SHUT UP!!!!! If they pick up the pen....CONGRATS! You don't sell....you SHUT UP! But.....not everyone is going to buy on the first date. You might have to wrangle a bit. It depends on your business model on how you proceed. We've closed a few dozen jobs in the last few weeks and some of them have been low bidder deals. Yes...sometimes,we are the low bidder. But, we didn't start out low...it just happened that we had to be there to get the deal. You learn that in the presentation and trial closes. Should we walk away from the deal because we are low bidders? I don't think so. We know what our range is when we walk in. We know what our "bottom line" is. We are willing to take the deal at the bottom line....but we aren't going to start out there. Inciently, if we only close one deal, at the bottom line, every day, I'd be a very happy man....especially when I leveraged that production rate by adding salesstaff...because....if I can sell one, then two of us could sell two.