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Re: t&m vs. flat rate for service? [Re: macmikeman] #184873 02/24/09 06:56 PM
Joined: Aug 2007
Posts: 853
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leland Offline
Member
Oh Ya, "free estimate" (my back side!). It is always rolled in.

Even T&M, I (most)always give a 'not to exceed', so that is probably as close to flat rate that I have come.Usually I do ok,But.. Sometimes...
Just trying to fine tune things now for reasons beyond my control.

necessity breeds invention (or modification at least).

Business, Office, Estimating, Legal:
Re: t&m vs. flat rate for service? [Re: jdot77] #185917 04/04/09 04:28 PM
Joined: Jan 2005
Posts: 71
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sid123456 Offline
Member
Doesn't really work so great here in Florida in my opinion. Too many different situations and too many little guys out there to compete. Free estimates or t&m work for me.




www.pewiring.com

Re: t&m vs. flat rate for service? [Re: sid123456] #185920 04/04/09 08:19 PM
Joined: Jul 2004
Posts: 272
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A-Line Offline
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Originally Posted by sid123456
Doesn't really work so great here in Florida in my opinion. Too many different situations and too many little guys out there to compete. Free estimates or t&m work for me.




www.pewiring.com

Check out page 20 in this magazine. It's about a flat rate contractor starting up in florida. http://www.thesuccessfulcontractor.com/backissues/08_WINTER.PDF

I wonder how he's doing in florida.

Re: t&m vs. flat rate for service? [Re: A-Line] #185921 04/04/09 08:54 PM
Joined: Jan 2005
Posts: 5,316
renosteinke Offline
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Member
Amazing how hard it can be to have a productive discussion, when definitions keep changing!

"Flat rate" is simply telling the customer "I will do the job for $X." This is essentially what Mr.Sparky does - with the addition of a service charge to go look at the job. No free estimates there.

Just where does that 'flat rate' price come from? Invariably, there is some reference to your past experience, and allowance for whatever complicating factors there might be. Given a large enough sample base, you can fairly state that a certain task will take "H" hours, use "$P" in materials, require the use of certain equipment (surcharge there), and come up with "$X" as your price.

The advantage to various software and franchise operations is that they allow you to draw upon a larger sample size, and have a support system to help keep material costs up to date.

T&M is an arrangement akin to a blank check; that's something you won't trust to just anyone. It has its' uses - especially when an established contractor has a project of unknown scope and duration.

For example, painting the Golden Gate bridge is an instance where T&M can work well - that job never ends! By contrast, painting your house ought to lend itself to 'flat rate' pricing.

Another key to the Mr. Sparky approach is to have the guy doing the estimate arrive in a fully stocked truck, ready to do the job RIGHT NOW. There is pressure- if nothing else, that service call fee- to get the customer to commit right now to having the work done. Such immediate service can allow you to charge a premium.

Re: t&m vs. flat rate for service? [Re: renosteinke] #185926 04/05/09 12:12 AM
Joined: Nov 2005
Posts: 507
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mahlere Offline
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Originally Posted by renosteinke
T&M requires a great deal of trust between the customer and the contractor. It can only work after a long standing relationship has developed.

As for "flat rate," we ALL like to know ahead of time what we can expect to spend. Would you roder at a restaurant, without knowing the cost?


reck roh...:D

that being said, i've been to a bunch of restaurants in NYC that you do order without a menu and without pricing...some of the best italian restaurants are like that...

Re: t&m vs. flat rate for service? [Re: mahlere] #185930 04/05/09 03:46 PM
Joined: Jul 2004
Posts: 272
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A-Line Offline
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Originally Posted by mahlere
Originally Posted by renosteinke
T&M requires a great deal of trust between the customer and the contractor. It can only work after a long standing relationship has developed.

As for "flat rate," we ALL like to know ahead of time what we can expect to spend. Would you roder at a restaurant, without knowing the cost?


reck roh...:D

that being said, i've been to a bunch of restaurants in NYC that you do order without a menu and without pricing...some of the best italian restaurants are like that...

Often times when people are spending money on entertainment and recreation they have a tendancy to not worry so much about the cost.

They're out having a good time, they don't want to spoil it by stressing over how much it's costing them.
That's why they'll pay 2 bucks or more for a hot dog.

Generally they'll stress over it the next day after the hangover wears off and they realize how much they spent. smile




Re: t&m vs. flat rate for service? [Re: A-Line] #186066 04/14/09 09:48 PM
Joined: Jan 2005
Posts: 71
S
sid123456 Offline
Member
He won't survive here. Too many local contractors. How many people can you sell a 6500.00 panel upgrade to? Can anyone say ripoff. I lived in Atlanta when he started. I just don't think it can work here. When I moved here I thought it would be a great model but I don't think that anymore. Time will tell.

Re: t&m vs. flat rate for service? [Re: sid123456] #186067 04/14/09 09:58 PM
Joined: May 2003
Posts: 1,154
dougwells Offline
Member
Originally Posted by sid123456
He won't survive here. Too many local contractors. How many people can you sell a 6500.00 panel upgrade to? Can anyone say ripoff. I lived in Atlanta when he started. I just don't think it can work here. When I moved here I thought it would be a great model but I don't think that anymore. Time will tell.


I didnt see where Mister Sparky charges 6500 for a panel upgrade/swap out,if he wants that for the Panel I wonder How much the 200 amp overhead service upgrade is on top of that 6500.00

Last edited by dougwells; 04/14/09 09:59 PM.
Re: t&m vs. flat rate for service? [Re: sid123456] #186071 04/14/09 10:51 PM
Joined: Jul 2004
Posts: 272
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A-Line Offline
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Originally Posted by sid123456
He won't survive here. Too many local contractors. How many people can you sell a 6500.00 panel upgrade to? Can anyone say ripoff. I lived in Atlanta when he started. I just don't think it can work here. When I moved here I thought it would be a great model but I don't think that anymore. Time will tell.

At what price point would it no longer be considered a ripoff?
6000.00?
5500.00?
5000.00?
4500.00?
4000.00?
3500.00?
3000.00?
2500.00?
2000.00?
1500.00?
1000.00?
500.00?

Who determines whether it's a ripoff or not?
The customer?
Other electricians?
Other electrical contractors?



Last edited by A-Line; 04/14/09 10:59 PM.
Re: t&m vs. flat rate for service? [Re: A-Line] #186072 04/14/09 11:02 PM
Joined: Jan 2005
Posts: 71
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sid123456 Offline
Member
Market average. Walmart sells 4 tires 4 $400. Sparky sells same 4 tires for $3,000. ????

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