The nature of the beast is that low-bidding to get work is totally self-defeating. Either give it away entirely or charge your regular rate.
WE ARE NOT MANUFACTURERS.
We have essentially no control over material costs. Like wheat farmers we must operate as price TAKERS -- not price SETTERS -- when it comes to our inputs: our cost of living, job risk and routine materials.
Unlike farmers we cannot borrow against the farm to tide us over while we cut our price to move out the grain. Every dollar of contract price reduction comes out of our income -- quite promptly -- and in this credit contraction no one can fudge cash flow
Our business is contracting massively. With the loss of contract volume profit margins must go UP -- not down!
Survival dictates that additional income must be generated in non-traditional areas. A shrinking pie plate means that you MUST find another pie.
Right now that might be solar arrays. It might be Title 24 upgrades. ( California ) It might mean foreclosure operations wherein you function as a GC.
What ever you do -- do NOT increase the supply of electricians. That means fire all of your apprentices ASAP. Any compassion that you may feel must be balanced with the reality that any attempt to 'carry' them will bankrupt you.
Trends in technology have crushed the need for wire jockeys. Alarm and security systems have gone wireless. WiFi has ruined the retro-fit cable-fishing craft. Wireless X-10 and its analogs (digilogs?) have eliminated our craft as well.
Hence we have three or four guys chasing each job opening.
Here abouts wages have collapsed 40% for j-men; i.e. non-union shops are paying $17/hr vs $27/hr. By comparison the local cost of living has not dropped at all.
All of the older troops have been kicked to the curb.
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I watch CraigsList every day to keep tabs on the latest players to liquidate their businesses. Prices keep dropping on all construction tools and assets.
Just as shocking is the rise in stolen professional tools on offer.
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In this kind of environment putting additional trades under your hat makes perfect sense.
It also makes sense to network with other tradesmen and form a 'reference co-op.' Every team member maintains a stack of b-cards for himself and his buddies. The co-op scratches each other's back on the cheap. Significant work discovered is rewarded with a spiff.
An example: you're swapping out a Hunter fan. You see lousy cabinet faces/ tired faucets/ handyman eyesore 'repairs'. Whip out the b-cards.
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Create a 'line card' with skills listed instead of products.
Stuff like landscaping electrical -- sticking solenoids at the irrigation valves -- compromised wet connections....
Pitch exterior receptacles -- garage circuit extensions -- more wrap fixtures over the tool bench.
Have such materials at the ready and bid them to reflect ONE service call efficiency.
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I shun painting because color match and pre-prep is such a challenge. But I don't mind closing up my penetrations on a rough/semi-rough basis. In this manner the customer can either perform the 'eye-wash' finishing or contract it out without huge time pressure.
Last edited by Tesla; 11/28/09 04:53 PM.
