Don't you love it when unlicensed, uninsured hacks price themselves so low it hurts the market?
One of my previous employees, a 22 year old nice guy but not reliable, came by the office today to tell us how things are going since we let him go. It seems he's working for himself and covered up with work. He showed me a flyer. These were his prices: replace a 2 story foyer fixture $75 dining rm chandelier $30 ceiling fan up to 12 ft $55 flood light replacement $20
I'm sure he's making a decent wage at these prices, but he's hurting the market. I could turn him in, but I got started in much the same way. I just hope his customers know the risk they take. I warned him of the risks he's taking.
Here in Jersey it's amazing to see how HO's will spend $70K and up for a top-end European import yet throw their own safety to the wayside and have unlicensed, therefore uninsured, people wire their homes. With all the laws and regulations on our books, I see poor and unsafe work almost daily. I was in a rental today and among many atrocities found five plastic countertop boxes fed with BX pushed through the NM slots and of course all had grounded duplexes that weren't grounded in a remodeled kitchen...forget about GFCI's. How 'bout some plastic boxes had the backs cut off because the wall depth was too shallow for them, yikes! Not too long ago, I had an emergency call from a guy who let his painters wire his bathroom. When I got there he complained about what lousy painters they were...did he think their electrical work was going to be better! There's always going to be kids making a buck on the side, we all did once, but to see all these home improvement guys doing electrical work for peanuts is a real killer.
I think it's a typical transfer from working for someone else to working for yourself. I charged the same as I was making at my last job and earned a whopping $2400 my first 6 months. I gradually raised my rates, but still had no clue about overhead and billed hours. I stuck with it, but it's the reason most people don't make it more than a year or two.
As for the people that hire someone like this...I'll be here next year to cover the warranty...will they?
Russell, you need to move a few miles south. I'd be in a diferent business if I had to truely compete with these prices. Luckily the homeowners in our area are upper income and most go the pro route. The only customers I'm losing to guys like this are the cheapo's I don't want anyway.
Re: Price Busters!#155316 12/23/0412:07 AM12/23/0412:07 AM
I think a lot of guys start that way. They don't understand the differance between running a business and colecting a paycheck. No taxes are taken out of what they get so it seems like more. Sooner or later they will figure out it's a lot of work and they have no $. So their next step is to copy the rates of the local shops. And maybe that's still not enough.
It's one thing if they work legal and cut their throat with low prices. What I hate is when they don't meet legal requirments with insurance, taxes, permits, bonds, etc.