ECN Forum Forums General Topics of the Trade General Discussion Area Making Money

I do charge $50 extra for the first hour but don't have the stones to ask the customer to pay for my ride back to the shop like Shortcircuit does. Gonna have to start cutting overhead somehow. Exel is a mystery to me, so I don't know how to track everyting using it. Maybe time for computer classes too. I did get back into the Nosecrets site today without a password. Did google search for main site index and went in from there.

Pat,
"Gonna have to start cutting overhead somehow."

Yup, just cut your overhead, give up some of those frills, like your insurance coverage, stop wasting money on truck maint, Find a cheap Accountant and do your own payroll, Cut back on ad's , print up a flyer and take it door to door, cancel your comp insurance, what's chances anyone will get hurt, Oh don't use call forwarding or any phone features they cost too much, just put an answering machine on line, customers like them.

If your rate is a little higher then others, it may be possible, you have some needed expenses, that they do not have, so compete on good service, not price.

It used to really bother me when a customer would question my price or tell me they could get it done cheaper. It doesn't any more. I have to make a profit. If I don't, I won't be in business at all. The "good" customers, the customers you want, will pay your price without question because they know you do quality work and if they have a problem on that installation or need something else, you will be there to help. The guy working for wages without insurance won't be there and probably will have a new phone number later.

You can,t take it as an insult when your prices are challenged, it is just business nothing else.how many of you whrn your vehicle breaks and you get a quote say theres no way,I will take it some place else,how can it cost that much,well just do the minimum to keep it running.I would bet more of us than you would like to admit,so what is the difference.

I guess I've been avoiding those challenges by keeping my prices lower than they need to be. Now, with everybody's help here, I feel like I am totally armed to meet any challenges to my prices with clear, logical and rational arguments. All your posts have also helped me justify raising my prices to myself---no matter what somebody else is charging. Thanks again everybody.

Anybody out there working for a residential service company that works out of a flat rate pricing book?

Pat

Pat,
Are you asking if there is a flat rate calculator or book for residential?
I will more than likely catch *#@& for this but Home Depot gives away a CD that has their pricing in it as well as a little estimating package that gives labor hours to install any given item. You can adjust the labor dollars, taxes and mark-up. I think it is one of the best free estimating software packages out there. I don't use it since it does not fit my end of the electrical biz but I did find it to be very close to the labor hours I used when estimating commercial work.

[This message has been edited by kentvw (edited 09-03-2004).]

We don't quote residential, except for new construction. Too many surprises when you get into what the "previous owner" did; and, they try very hard not to understand that a quote to change the fixture doesn't include relocating the light.

I'll look for that software at H. Depot thanks.
I know that some of the bigger residential service shops (read franchises) have their own flat rate pricing books/software that include the vast majority of situations you will find in most homes. I believe these companies charge a service call fee to show up and diagnose the problem----THEN give the customer the flate rate prices to fix or replace the problems they found. If the customer says the prices are too high, they collect their service call fee and away they go. Close rates for this type of service are around 80-90%--- Meaning that the customer says go ahead and fix the problem while you are here 80-90% of the time.
The books/software they use are based on the material costs and average labor time to perform any given task. You just program your own mark-up % and labor rate into the computer and it gives you the prices. You avoid complaints from the clock watchers about hourly rates because the customer really doesn't know what labor rate you are using, and doesn't feel he is being charged by the minute.
At the business chat last Wed. night, somebody mentioned that the company he/she works for calculates it's flat rate prices at $275 per hour for labor. That would be $2,200 per eight hour day (assuming that all 8 hours are billable). Not bad, right?
I have to assume that there are separate line items for replacing a light and MOVING a light. Those darn customers can be very confused when they want to be, can't they!

Pat

sooner or later HD inspectors will probably be available too, just like insurance companies that own the facilities and the doctors these days

some call this the invisible hand of capatalism, or that which sets the tone for all whom constitute supply / demand....

all they really need do is lobby the NEC, and we'll all end up with orange tool belts...

~S~

There was an interesting sign at my supplier that showed an ad from Home Depot regarding electrical installations. My supplier's comment was that they would never compete with us for business.

Dave

[This message has been edited by Dave55 (edited 09-04-2004).]