ECN Forum Forums General Topics of the Trade Business Related Discussion views on pricing

I can get downright uncivil when it comes to protecting my family and employees.

I don't care if you charge flat rate, t&m, wampum, crack rocks, or whatever,

just know your costs. your true costs. don't assume. do the calculations.

Last thought (publicly anyway) on this subject.

Dnk doesn't do residential service or installations. How come?

There isn't enough money in it for him.

So, rather than letting other people fill the needs and voids and make a good living doing it. He'd rather advocate the exact behavior that caused him to decide there isn't enough money in it for him.

Now, if that is not convoluded thinking, I don't know what is.

By the way, I don't have a million dollar home, or a private jet or any of the other things that you "rip-off" contractors own. However, I also don't want to work 60 hrs a week to cover my bills. I can just as easily go work for another contractor if I wanted just enough to cover my bills and go fishing on sunday. Plus, I wouldn't have the headaches.

Good luck and fight the fight. Read, learn and move beyond guys that just don't get it.

Well it seems to be getting worse...

Ad hominem attacks are usually a last resort when one can bring nothing of substance to a debate.

I can't imagine what the logo on someones truck has to do with their competency.


Anyway,

It has also been implied that us "non-ESI" types don't return phone calls promptly, don't stand behind their work and that most customers want same day service and are willing to pay a premium for it.
I have no dispatcher, but I have a cell phone. If I'm not carrying it, I check it hourly. Most missed calls are returned within about an hour, the others are returned by the next morning. I can only think of a few times in the past 5 years when a customer couldn't wait for my service, and I'd expect them to go elsewhere. I'd even refer them to someone else. Some people will pay a premium for faster (not necessarily better) service, but all things being equal, I personally would wait a few days and pay $2,000.00 for a service upgrade than pay $4,000.00 to have it done today.

I have one full-time man with benefits (medical, hoildays, vacation) and I am on the verge of hiring my second one. So far, I haven't needed gimmicks.
My overhead costs are simply not that high, and my prices reflect what I need to sustain minor growth. That is all I'm after right now. If things change, maybe I'll change.
Until then...

"Why can't we all just get along"



[This message has been edited by Redsy (edited 04-17-2006).]

(Moved here from General Area)
Please continue civilly.

[This message has been edited by Webmaster (edited 04-17-2006).]

Redsy,

I haven't given into any ad homimem attacks. I just get downright uncivil when someone who has a history of not understanding, publically calls a large segment of our industry liars

I also get angry when they essentially tell consumers (consumers who they do not want to deal with because there is not enough money in it for him.) that they should not have to pay for our time

I also get pretty pissy when someone doesn't comprehend that not knowing your costs = being a bad business man

I might even tend to get upset when he calls a good percentage of hardworking contractors greedy

Or when he doesn't realize that the law says we have to pay employees for every hour they work, even travel time between jobs

Maybe even a little frustrated when he doesn't realize that there is a difference between running a company and owning your job. Might be better off working for a contractor A.

I might even get ticked that he tells consumers that our work is a commodity and there really is no difference between any of us

Or that he doesn't comprehend the fact that a good portion of the going rate contractors can not afford the things that "rip off" contractors can
(I'll tell this to the 25-30 contractors I see daily who are in this situation. See, in NJ it costs $800-$1000/month for an individual to get medical insurance for a family of 3-4)

But if I was going to actually get mad, it would be when they tell consumers that they shouldn't have to pay for our services

I mean, to generalize and use ad hominem attacks on an entire segment of our industry. That would just be wrong.

Redsy, if you are able to pay for your employees medical benefits, give him paid holidays and vacation, pay him a above average salary and whatever other benefits. Yet still pay yourself a good salary and cover your families benefits, take vacations, etc. And do it on the going rate. Then more power to you. You are the only person I've ever met who is able to do it. No lie.

First of all...I'm not the Dave that some are commenting about.

In regards to pricing, the central issue IMHO is about trust more than price. Does the client trust that you will be professional and provide a quality installation at a FAIR price?

This is rarely an issue on repeat jobs, but is a major issue on first jobs. It is confusing to first time clients when they're trying to find a good contractor and aren't sure how to compare them. This is where you get questions like "What is your hourly rate?".

When someone isn't trustworthy T&M or Flat Rate can be abused. IMO T&M is stress-free for the contractor (if it takes longer, you still make your rate). IMO Flat Rate is stress-free for the client (if it takes longer, the price remains the same).

On the issue of price, there is no guarantee which system will save money for the client or be more profitable for the contractor.

I've done both & prefer Flat Rate. I prefered T&M when my estimating skills were weak. My #1 & #2 skills now are high-quality installations & estimating. I'm able to very accurately estimate the variables of an installation.

A contractor fears working for nothing & if you underestimate, you're working for nothing on part of the job. That's a good reason to use T&M, but to repeat myself, I don't use it because I think it adds stress to new clients & I don't have significant problems with estimating.

I should add that almost all of my work is residential service.

Dave

First off, let's get something straight...

My response was to Veronica, and all my views expressed are my opinions, just as these are yours...

The views and opinions that are expressed on this board, should stay on this board. The idea of posting on various boards, with the intent of slamming someones ideas or opinions to justify an opinion of your own, is outright childish (for lack of a better PG rated word). Grow up......

Why don't any of you here, post a topic on that site, in regards to contractor pricing?
Why is that sites topic here, it was started there and should stay there......

My views on large add advertisers and charging fees to show up are well know here, and documented. It is not my idea of running a business, nor will it ever be. Does that make me a business guru, probably not.... Should I go complaining to everyone, that everyone should go to T&M, because otherwise your all bring the industry down, probably not....
Should I say, that I can't make any money, because of the rest of you, so therefore I'm leaving this industry..probably not....

I stand by everything I write, and I am not interested in fighting any fight.

Now let's take on the personel stuff...

Aline:
The quote you posted is my thought. I stand by it, and will always state that a Large page advertiser is going to cost more than most everyone else. They have to pay for that advertising, and we all know who is getting billed for it....And yes, to me..if someone wants my money before doing anything..this is a red flag to me..shame on me once, not again..Do I have the right to share my thoughts and experiences with anyone else..absolutley...the same guy that gave me that right, gave you the right to tell me I'm nuts....

Rich R,
My business plan is simple. Contractor B.
Does that make my plan any better or worse than yours...doubt it...
Should I increase my overhead, so I have to raise my prices, so I loose my competive edge? No, we both know that won't happen...
As far as employees, read some earlier posts. When I first started out I did resi remodels and service. I know all about it..There was 4 of us, and yes, all recieved health benefits, vacation pay, ect... I am not a slumblord contractor making a killing off employees backs.... I don't think anyone at this site is. There is too high of a class of people here...
The shazamm thing? I had a marketting guy come up with all that for me.....The bolt isn't trade protected so if you want to use it, go ahead...

Capt al, don't want the job, got too much work of my own...still looking for a camera though...

Les, once again the voice of reason..Thx..

Mahlere, I have no itentions of defending myself at the other sites that you felt so inclined as to bash me. Pls, go there and tell them I didn't start a thread there, reply to a thread there, so I have no need to get involved with your antics..Where a thread starts, it should stay and stop. If you feel as If Myself, redsy, John, Dave, mark, ray, dave S, and other contractors in my area don't get you, I don't know what to tell you...If you feel the desire to shout at the top of the mountain that we are causing the decline in the electrical contracting industry, and because of us, you can't make a living....so be it...you were given the same right as myself and A-line were...

Now having been long winded here, I have to go bury my brother-in-law...After that I am spending the rest of the month in Aruba tuna fishing and playing golf...

Keep it civil...

Dnk...

maherle,
The ad hominem comment was not directed at you.
Anyway,
My situation is different than yours. I continue to personally work in the field and I hire trainees, who probably don't cost me as much as "seasoned technicians".
Besides, based on the electrical work I see from "electricians" who preceded me, I am reluctant to hire someone and send them, unsupervised, into a customers home. Remember, here in PA, ECs are not regulated. So the guys who have 5 years experience often have it from working with a hack who is only licensed because he paid a $100.00 fee to the township. (Overstuffed / ungrounded boxes, mini breakers where they don't belong, PVC conduits underground with NM cable inside, service upgrades without GEC upsizing, etc.) Last year I got my NJ license, and since I have some opportunities to use it, I'm hoping it isn't as bad over there.
Also, about 50% of my work is new construction, so on average, my unbillable hours are quite a bit less than a service-only outfit.

Good luck!

DNK,

Can't argue with your opinion.

Sorry about your BIL, never fun.

But DNK, I still think you did the entire industry, and all the hardworking contractors everywhere, an incredible disservice with that post. Pushed us back a couple of years.


BTW, reread LK's post. I read that he's telling you to run your business how you want, but don't screw those of us that want to run it differently. Ironically, that has been my contention all along.

You and I have disagreed on most everything, but never once did I start a topic calling you out. I simply answered your questions and attempted to show you my point of view.

[This message has been edited by mahlere (edited 04-17-2006).]

Redsy,

you're last line is the crux of the issue. New construction and service work are 2 different animals.

I get upset with guys who don't understand the service industry, telling those of us in it that we are greedy, and telling customers that we charge to much.

If you want to do new construction with yourself and a couple of helpers, that is your decision. But, please don't equate your costs/overhead/etc with those of a service contractor. They are different.

Read Plumbing and Mechanical Magazine (Randall Hilton, Maurice Maio, Frank Blau - he retired, but his old columns are archived-, Ellen Rohr, etc) They are light years ahead of the electrical industry for service work.

Read them, understand service work. Then decide if it's for you or not.

But to take a new construction mentality and tell people to never believe a contractor. That there is some mythical going rate - who set this rate and based on what?

Redsy, your business is your business. You will run it how you see fit. But please read the people I mentioned, it will give you an incredibly different perspective.

Good luck.