ECN Electrical Forum - Discussion Forums for Electricians, Inspectors and Related Professionals
ECN Shout Chat
Top Posters(30 Days)
Trumpy 5
Recent Posts
What do you do?
by gfretwell. 09/18/17 08:17 PM
Supporting conduit bodies
by ghost307. 09/18/17 12:12 PM
Thermal Imaging Camera upgrade
by Potseal. 09/18/17 11:57 AM
Linear Power Supply Quits Under Load
by JoeTestingEngr. 09/15/17 11:37 PM
Recreational Trailer Power Supply
by David1. 09/14/17 01:55 PM
New in the Gallery:
Gallery Test
Popular Topics(Views)
240,835 Are you busy
176,591 Re: Forum
168,512 Need opinion
Who's Online Now
0 registered members (), 52 guests, and 9 spiders.
Key: Admin, Global Mod, Mod
Previous Thread
Next Thread
Print Thread
Rate This Thread
Page 1 of 3 1 2 3
#155735 - 02/03/05 12:30 PM Flat Rate Pros & Cons "Flat Rate Book Pricing VS Variable Spot Pricing"  
mustangelectric  Offline
Member
Joined: Feb 2004
Posts: 494
Bentonville, AR
Hi,
I am ironing out Flat Rate Book rates vs Variable Flat Rate Spot Pricing. I am chief cook and bottle washer at my place! (sole prop)

Sometimes a job is worth more than others.

If you have a preset flat rate for replacing a 200A panel this would seem to restrict you from keeping up with several issues like changes in fuel cost and commodities.

ALso it would prevent you from making more profit from the same task.

Say I get a job to replace a 200A panel burnout in an old house...the job is for a little old lady who is living alone and has no insurance or deep pockets.

then you have the same job at a newer house from a young couple who just bought the house and both are professionals and they have insurance to cover the damaged panel replacement.

you get the same call from another woman who is living in an old house that is filthy and cluttered, smelly, nasty funk.
it doesnt look as if the woman has any money at all to spend on the work. I shoot a high price because I do not really want the job..low and behold she accepts!( come to find out this lady just won the lotto for $250K and has plenty of cash) just goes to show that looks can be deceiving.

These three examples (the third is true)demonstrate where I can make three different quotes. Each paying different.

Whereas if I quoted all three the same price I am leaving money on the table.

The cost would increase with each case from the first to the last.

There is probably a name for this practice and I wonder how ethical it is?


I am sure there are those who will be SHOCKED! I am not the only one who uses this method am I?


regards

Greg


[This message has been edited by mustangelectric (edited 02-03-2005).]


Electricity has no respect for ignorance!

Business, Office, Estimating, Legal:

#155736 - 02/03/05 01:31 PM Re: Flat Rate Pros & Cons "Flat Rate Book Pricing VS Variable Spot Pricing"  
A-Line  Offline
Member
Joined: Jul 2004
Posts: 272
Utah, USA
Greg,

What are you going to do when you have 20 techs. Are you going to let each tech make his own judgement call?
You mention you want to set your business up like a franchise. This would not be a good way to operate a franchise. A franchise is a business system that produces the same results over and over again. You would never now what price a tech might qoute the customer.
Everyone should pay the same price unless they get a seniors discount, have a maintenance agreement or a coupon.
When you go out to dinner and a movie they don't adjust the price based on how you're dressed or what your car looks like.
If you find someone you truely feel needs help you could make an exception but I would not make this the norm.


#155737 - 02/03/05 01:48 PM Re: Flat Rate Pros & Cons "Flat Rate Book Pricing VS Variable Spot Pricing"  
mustangelectric  Offline
Member
Joined: Feb 2004
Posts: 494
Bentonville, AR
Hi,
I am the one considering setting up the francise not me buying one. I want to sell my ideas and methods.

There are PLENTY of Mr. Electrics out there. What there is NOT is Mr. Electric. The single guy. If a person decides to hire more people then that is ok.

Most companies do not allow the hands to bid on work. I know there is a book here but you are leaving the door open to losing your britches if you run across a couple deals where the book did not work out.

Most outfits will have a guy or two who will go ut and visit the job and come up with a estimate or proposal.

Your major income is not going to come by having the hands in the field quoting cost. Sure you will get this from time to time.

My situation is that I am the guy who is making things happen.

I just think that there are a lot of one man shops out there that could benefit from this method of pricing.

If I can bid $2000 on a $1000 job I will do it. Why not car salesmen, realestate, lawyers, doctors do it every day!

If I sell it great if I dont I move on.

I am sorry but I say you are sadly mistaken when you say "Everyone should pay the same price". That is in a perfect world.

We do not live in a perfect world. Thats not news.

There are very few contractors that log in the same amounts each day for work. No two receipts are ever alike!

If I get twenty hands, I will hold meetings with them and give each one a way to stay in touch. I will also share my profits with my hands. The employee can make or break you.

Regards

Greg


Electricity has no respect for ignorance!

#155738 - 02/03/05 01:48 PM Re: Flat Rate Pros & Cons "Flat Rate Book Pricing VS Variable Spot Pricing"  
Dnkldorf  Offline
Member
Joined: Dec 2004
Posts: 1,064
nowhere usa
That's where me and A-line differ.

The old lady gets a break no matter what. To me, she earned it.

However, she and the military folks are the only ones who get breaks, everyone else is the same price, give or take on the complexity of the job.

Giving breaks to the eldery and the military may not fatten your wallet now, but the return in word of mouth advertising is priceless, and to me, it is the ethical thing to do.

Aline, I'm not knocking you here, I'm just telling mustang what I do.


Dnk.....


ps. I have been known to pull into a driveway and noticed a POW tag on the car. All the work was free.

[This message has been edited by Dnkldorf (edited 02-03-2005).]


#155739 - 02/03/05 01:53 PM Re: Flat Rate Pros & Cons "Flat Rate Book Pricing VS Variable Spot Pricing"  
mustangelectric  Offline
Member
Joined: Feb 2004
Posts: 494
Bentonville, AR
Hi,
i do not mind giving breaks and I do all the time. I also know that EMOTIONS and business do not mix!

I can support the troops and help the ones who need it but I am in business to make a PROFIT.

I see no real problem with variable pricing.

I already know what T&M will do to you!

Cost Plus or Variable Spot Rates!

Regards

Greg


Electricity has no respect for ignorance!

#155740 - 02/03/05 02:05 PM Re: Flat Rate Pros & Cons "Flat Rate Book Pricing VS Variable Spot Pricing"  
A-Line  Offline
Member
Joined: Jul 2004
Posts: 272
Utah, USA
I didn't say don't give little old ladies a break. This is what a seniors discount is.
I give a seniors discount to all elderly people male or female. I feel they both have earned it.
You could also have a policy of giving a discount to military personel also.
The flat rate system I'm describing isn't something I made up.
It is a proven system that works and many successful businesses use it.
If you want to be successful why not do what the sucessful businesses have done?
They didn't get where they are by accident.
I want a business that can still operate even if I'm unavailable. I may get injured and laid up in the hospital or may want to take a vacation overseas somewhere. It would be nice to still have jobs being priced and sold while I'm gone.
I don't see how you can sell a franchise if you're the only guy that can make things happen.


[This message has been edited by A-Line (edited 02-03-2005).]


#155741 - 02/03/05 02:12 PM Re: Flat Rate Pros & Cons "Flat Rate Book Pricing VS Variable Spot Pricing"  
mustangelectric  Offline
Member
Joined: Feb 2004
Posts: 494
Bentonville, AR
Hi,
A-line..what do you mean I couldnt sell a franchise?

You said: "I don't see how you can sell a franchise if you're the only guy that can make things happen."

I do not even have the faintest idea what you mean.

If I have a good name, good practices, and can make a profit then what about that is not marketable and would be even more profitable?

I am working on a good name now!

Have you ever heard of tupperware or avon?

There are a lot of folks out there who are not doing so well in the EC biz and most of them would be willing to listen to a way to increase profits.

What part of that would not sell?

I know lots of sole proprietors who got twenty guys and 10 trucks and they are no longer with us. I also know a lot of sole proprietors who are making a living but want to make more and have a vacation and some extra money at the end of the month.

Its not all about twenty hands..

But I hear you...

regards

Greg

[This message has been edited by mustangelectric (edited 02-03-2005).]


Electricity has no respect for ignorance!

#155742 - 02/03/05 03:35 PM Re: Flat Rate Pros & Cons "Flat Rate Book Pricing VS Variable Spot Pricing"  
A-Line  Offline
Member
Joined: Jul 2004
Posts: 272
Utah, USA
Hi Greg,

Yes I have heard of Tupperware & Avon.
I'm not sure how they operate so maybee you could answer a question for me.

Does the founder of Avon visit each customers home and adjust the prices of the products based on what he sees or does a sales rep visit the customer's home and present the prices to the customer from a catgalog or book?

Does the sales rep adjust the prices in the Avon catalog based on what the customers residence looks like?

If there is a situation where the book will not work the tech can then call back to the office for help. Your techs do have to be well trained on how to use this system.

Edited for typing errors.

[This message has been edited by A-Line (edited 02-03-2005).]


#155743 - 02/03/05 03:39 PM Re: Flat Rate Pros & Cons "Flat Rate Book Pricing VS Variable Spot Pricing"  
A-Line  Offline
Member
Joined: Jul 2004
Posts: 272
Utah, USA
I used to work at a Coca Cola bottling plant.
2 elderly gentlemen pulled up to the dumpster in a beat-up old station wagon.
They started rummaging through the dumpster and digging out unbroken bottles.
I thought that they were going to cash these in for money. Looked as if they needed some. I found out they were the owners of the company and were digging out these unbroken bottles so that they could chew out the manager for throwing them away.

Looks can be deceiving.


#155744 - 02/03/05 03:39 PM Re: Flat Rate Pros & Cons "Flat Rate Book Pricing VS Variable Spot Pricing"  
Dnkldorf  Offline
Member
Joined: Dec 2004
Posts: 1,064
nowhere usa
A-line, where do you get these books you speak of?

I would like to get one and see how you guys in the resi market are doing it.

The curiosity is killing the cat here.

Dnk......


Page 1 of 3 1 2 3

Member Spotlight
HappyElectrician
HappyElectrician
Penn USA
Posts: 31
Joined: December 2011
Show All Member Profiles 
Featured:

2017 Master Electrician Exam Preparation Combos
2017 NEC Electrician
Exam Prep Combos:
Master / Journeyman

 

Shout Box
Powered by UBB.threads™ PHP Forum Software 7.6.0
Page Time: 0.044s Queries: 15 (0.027s) Memory: 0.8246 MB (Peak: 0.9988 MB) Zlib enabled. Server Time: 2017-09-20 21:54:00 UTC