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  • #16
    Re: Flat rate pricing

    Crappy,

    As I said I am not totally against flat-rating as long as everything is up front and you are using real world man hours.

    I am not from Utah I am from Los Angeles. I own some recreational property in Utah and I am the President of a Water Company in Utah. I am a Plumbing Contractor in California and Nevada and had a plumbing contracting business in Los Angeles until 1999 when I sold my shop to an employee of 20+ years.

    I have also worked as a Plumbing Expert for Construction Litigation since 1988 so I have a pretty good feel for what it cost to get stuff done. The sad part is many of the flat-rate shops I have to defend have a shop full of kids who should still be riding with a journeyman learning plumbing and instead they are out there working like they are a journeyman. Having a truck full of materials and a pricing manual does not make you a plumber.

    Many of my former employees have started their own businesses and some are flat-rate companies. Some are out there protecting the trade and their customers and some are not. I have no problem with an $85 per hour rate for a service plumber if you can get it as there are additional cost for a service plumber over a production plumber. I do have a problem when a shop uses a guy who takes 4-hours to do a 2-hour job and then bases a flat-rate book on him. There are plenty of real world cost estimating books out there, it seems odd none of the flat-rate companies use them.

    Mark
    "Somewhere a Village is Missing Twelve Idiots!" - Casey Anthony

    I never lost a cent on the jobs I didn't get!

    Comment


    • #17
      Re: Flat rate pricing

      basic math 101
      A water heater (50 gal) $400
      Time to install with delivery and disposal 2 Hours
      $1040.00 charge customer

      I can charge $320.00 per hour don't have to have any more education and or experience than 90 days watching the guy driving the company van.

      All straps,valves,basically anything other than the water heater itself,is an extra at $120.00 per hour,plus 40% mark-up on material,Then I can go slow.

      Wow sounds to good to be true.How could I be so foolish to charge t+m

      Comment


      • #18
        Re: Flat rate pricing

        I have been building houses and garages and addition for years now. I do not use a flat rate, never have never will. I also do not mark up materials just to make more profits (which helps win bids). I do well enough and I'm not trying to get rich in this business. But that is what I chose to do. I have dealt w/plumbers and electricians, ect who uses flat rate. I will decide who gets the job by their reputation and bid, more so reputation. I don't see any problem w/flat rate as long as I can keep the bid down in order for us to win the bid. I do think Josh summed it up very well, and it does come down to the home owner, if they are pleased money wise and work wise you should be getting more work from them and their friends. But if they hear 6 months later that some other company would do the same job for less, you may never hear from them again. Competition is the name of the game, not everybody can go by flat rate, I might be hungrier then you, so I'll have a better chance to win that job.
        Great Link for a Construction Owner/Tradesmen, and just say Garager sent you....

        http://www.contractorspub.com

        A good climbing rope will last you 3 to 5 years, a bad climbing rope will last you a life time !!!

        Comment


        • #19
          Re: Flat rate pricing

          the big issue is flat rate and emergency repairs.

          a flat rate shop is not going to win bids on a real contract job. a job that the homeowner actually has put out to bid.

          what i see is that the homeowner that does not have a plumber, is going to look in the yellow pages, call a few companies, non of which will give a price over the phone, not even an hourly price, tell the customer they will be there in under an hour, and then the "desperate housewife" will get sold on a repair without even knowing what the actual cost of the job really is. no break down of the material or labor.

          sure there might be legitimate flat rate co's, but all i ever see and hear about from new customers is this flat rate scam.

          when they can sell you a $7.00 fluidmaster ballcock for $600. installed, do you think that they will show you the break down of $593. labor

          or how about the $800. thermostat

          these are just 2 examples in the last week.

          the ballcock guy got taken.

          the desperate housewife was smart, she called her husband at work. not only did he have his wife to throw out the 2 techs form the house, she didn't pay them their inspection fee.

          keep in mind that this goes on all day with these 2 different co's. even if they do just 1 in 5 jobs, they made up all for all the jobs, they didn't get. that 1 homeowner just made their day

          crappy, that 74% is very interesting in you polled clients wanting flat rate.

          i would like to see the percentage after 1 job for for them.

          i can raise my hourly rate at any time. typically once a year starting jan. 1st. my customers know this and are not blown away by the $5. increase to go along with the cost of doing business.

          now if i switched to the flat rate system that the local shops are using, i would have to raise my prices 300-400%

          sure, i would get rich fast, but the phone would stop ringing after the first job for them using the flat rate system others use.

          of course i give fixed prices on larger jobs. but it's all based on my estimate of time and materials. still waiting for another co. to under bid me.

          and yes my customers can afford to spend more. a persons wealth is not how i base my prices.

          i don't do apartments. i work in condos, homes and commercial complexes. i even do a large percentage of work for other plumbing co's.

          i think i do approx. 25% of my residential work for doctors and lawyers.

          to sum it up, nothing wrong with a fixed/ flat rate. just along as it is realistic and competitive.

          all i ever see from new clients are the ones that are not.

          rick.
          phoebe it is

          Comment


          • #20
            Re: Flat rate pricing

            I think some people are missing the piont. I look at flat rate as any other tool . If used properly it will benefit everyone, If not then evertuone suffers from it. Also anyone who is a new constuction plumber could not possibly under stand where I'm coming from. I understand in new construction large remodels pricing is much different. However in repair there are alot more cost Vehicle, gas advertising, so on . When I look around me at the phcc meetings most of the larger service and repair shops flat rate in someway. I bacame self employed to live well, and spend time with my family. Besides my wife went to the ear doctor the other week , waited almost two hours after her appoinment time and then paid 145.00 for him to vist with her 10 minutes. I know im just as qualified in my trade as he is in his trade. Im not a work out of the pickup truck wearing jeans smokin a butt plumber. I run a professional shop. If people want cheap they can look in the pennysaver.
            THE GLASS IS ALWAYS HALF FULL

            Comment


            • #21
              Re: Flat rate pricing

              Crappy days I think your going the right direction, and it takes courage to make the step. Yes you will lose some customers but they will come back if you provide good service and clean people. Go just about anywhere and flat rate pricing is used and NOT BROKEN DOWN FOR THE CUSTOMER TO PENNY PINCH. like mc donalds yes i would Like a Big Mac no pickle how much will taking that pickle off save me in money. Re-place toilet wax ring 185.00 Customer (hey re-use the bolts and my supply that's been there 6 years and don't grout it to the floor. How much will that save me.....Mc Donald don't cut you a break so why should you start chopping your price figure out what it cost to run your bussiness and make a GOOD PROFIT.
              You go into bussiness to make money for you and you family to live a better life. If you are charging what it cost you to make a living and PROFIT. You do not need to explain it to other plumbers. They'll never get it. be ready for the name calling Flat Rapist HA HA HA I'am laughing all the way to the bank baby.

              Comment


              • #22
                Re: Flat rate pricing

                yes but mc donalds dosn't cost me $185 for a big mac either i can get then for just a $2.50. so i would be dammed if i would pay you or any one else $185.00 to come out to my house while i miss a day of work, turn a valve off take out 2 bolts scrap out the wax ring replace the wax ring intall 2 new bolts reinstall the water line turn the valve on than toss the old wax ring in my trash can for a $3.00 wax ring. sorry i have done this job many many times and i would never go over $90 to do this job and even at that is steep, i mean i can do the whole job in less than an hour and a half.
                9/11/01, never forget.

                Comment


                • #23
                  Re: Flat rate pricing

                  Originally posted by Crappy days View Post
                  I'm not a work out of the pickup truck wearing jeans smokin a butt plumber.
                  Why were you looking at me when you said that?

                  It's really too bad this topic is back up again. I have now lost some respect for some of you guys

                  Josh was right.

                  ~Bill

                  Comment


                  • #24
                    Re: Flat rate pricing

                    Originally posted by Crappy days View Post
                    I think some people are missing the piont. I look at flat rate as any other tool . If used properly it will benefit everyone, If not then evertuone suffers from it. Also anyone who is a new constuction plumber could not possibly under stand where I'm coming from. I understand in new construction large remodels pricing is much different. However in repair there are alot more cost Vehicle, gas advertising, so on . When I look around me at the phcc meetings most of the larger service and repair shops flat rate in someway. I bacame self employed to live well, and spend time with my family. Besides my wife went to the ear doctor the other week , waited almost two hours after her appoinment time and then paid 145.00 for him to vist with her 10 minutes. I know im just as qualified in my trade as he is in his trade. Im not a work out of the pickup truck wearing jeans smokin a butt plumber. I run a professional shop. If people want cheap they can look in the pennysaver.
                    This is my last post I intend on this thread.

                    Crappy days and other flat rate,
                    This is not an attack on you personally,this is an overview and my opinion.
                    Because of the current status of society where a lot of people have the attitude of "Grab as much as you can as quickly as possible,because this is what the other rich guy is doing".And people who do not understand how to negotiate with this process get hurt(can you picture the elderly woman who is struggling to hold on to her last years of independence alone) she is the easiest one to get money out of.I know men personally who have quit these type of companies because they weren't comfortable with the pilaging attitude behind them.

                    I know a local service plumber who has been in my area for at least 25 years he is t+m at $105.00 per hour.His phone never stops ringing,he has a full time helper and all the amenities of what you might expect from someone who is well-off so I know flat rate is not the only way to get rich.

                    Again,this is not a personal attack on our our flat rate members.I just see how much damage it does to the good people in my community.There are a lot of companies abusing the system,peoples lack of knowledge,if the consumer was better educated we wouldn't be having this discussion.

                    Biting my tongue and signing off.

                    Adam
                    Last edited by drtyhands; 05-11-2007, 05:47 PM.

                    Comment


                    • #25
                      Re: Flat rate pricing

                      Again I dont how this went from flat rate to ripping people off. Today i installed a 600 series wilkinson 3/4 inch regulator , ball valve, and hose bib charged 385.00 . I did the job in 45 minutes with paper work , I believe that is a fair price. The price is not going to change with flat rate, its just going to make things easier book keeping, inventory, pay. Plus this way I and my techs are on the same page not 367. or 412. or 511. or 255. a set price . Consitency is the name of the game. Look at any large company and you will see they are consistant.
                      THE GLASS IS ALWAYS HALF FULL

                      Comment


                      • #26
                        Re: Flat rate pricing

                        Originally posted by drtyhands View Post
                        This is my last post I intend on this thread.

                        Crappy days and other flat rate,
                        This is not an attack on you personally,this is an overview and my opinion.
                        Because of the current status of society where a lot of people have the attitude of "Grab as much as you can as quickly as possible,because this is what the other rich guy is doing".And people who do not understand how to negotiate with this process get hurt(can you picture the elderly woman who is struggling to hold on to her last years of independence alone) she is the easiest one to get money out of.I know men personally who have quit these type of companies because they weren't comfortable with the pilaging attitude behind them.

                        I know a local service plumber who has been in my area for at least 25 years he is t+m at $105.00 per hour.His phone never stops ringing,he has a full time helper and all the amenities of what you might expect from someone who is well-off so I know flat rate is not the only way to get rich.

                        Again,this is not a personal attack on our our flat rate members.I just see how much damage it does to the good people in my community.There are a lot of companies abusing the system,peoples lack of knowledge,if the consumer was better educated we wouldn't be having this discussion.

                        Biting my tongue and signing off.

                        Adam
                        adam, my point exactly. this is the same issue i see here on this side of town.

                        rick.
                        phoebe it is

                        Comment


                        • #27
                          Re: Flat rate pricing

                          Originally posted by Crappy days View Post
                          Again I dont how this went from flat rate to ripping people off. Today i installed a 600 series wilkinson 3/4 inch regulator , ball valve, and hose bib charged 385.00 . I did the job in 45 minutes with paper work , I believe that is a fair price. The price is not going to change with flat rate, its just going to make things easier book keeping, inventory, pay. Plus this way I and my techs are on the same page not 367. or 412. or 511. or 255. a set price . Consitency is the name of the game. Look at any large company and you will see they are consistant.

                          crappy, why is there such a difference in price between one of your plumbers and another? is one more qualified than the other? is one job different than the other? i can see the time being a factor, but the material should be priced identical, part for part.

                          385. is not a rip off, but is high. a 3/4'' wilkins 600 is under 50. a 3/4'' ball valve is under 10. and a hose bibb is under 5. so that equals $65.00. $220.00 for 45 minutes is still not a bad price. but not a time and material price. even if i doubled these prices to $130. and charged 1 hour labor with a service call. i would still be $155. less than you.

                          the interesting thing is i was stretching the price, to prove a point. i would be $200 less than you i guess doing this for 32 years now has either taught me to be fast, proficient and very fair with my customers. could i charge $385. for this job? sure, but i don't need to

                          i guess there is a better way to get rich faster. i just don't believe in it.

                          like i said you price is not bad, but mine is better.

                          still curious how many of your present customers you will retain when they get your new pricing structure. i guess you will know sooner or later.

                          not telling you how to do your business, but i can tell you what i see when i see other invoices and estimates. i can also tell you how many of these flat rate companies that have trucks that sit all day in the parking lot waiting for the next disaster to happen.

                          within 1 mile of my shop are 2 of the largest flat rate companies in california. both have more trucks that sit, than go out.

                          just my own observations.

                          then i see my buddies shop with 12 trucks and they are out all day. the guys don't do any pricing or billing. it's all done in the office and sent out within a week. i guess his clients trust him and know what to expect, no big surprises.

                          he's in his 30th. year and not going to change either.

                          rick.
                          phoebe it is

                          Comment


                          • #28
                            Re: Flat rate pricing

                            Originally posted by PLUMBER RICK View Post
                            385. is not a rip off, but is high. a 3/4'' wilkins 600 is under 50. a 3/4'' ball valve is under 10. and a hose bibb is under 5. so that equals $65.00. $220.00 for 45 minutes is still not a bad price. but not a time and material price. even if i doubled these prices to $130. and charged 1 hour labor with a service call. i would still be $155. less than you.

                            the interesting thing is i was stretching the price, to prove a point. i would be $200 less than you i guess doing this for 32 years now has either taught me to be fast, proficient and very fair with my customers. could i charge $385. for this job? sure, but i don't need to

                            rick.
                            I see advantages (and disadvantages)to both sides and use a little of both but let me play devil's advacote for second. Rick, what about the time getting the part, planning the repair, doing invoice, filing the invoice, gas for truck (don't you have a 4500? biggg guzzler), insurance, chemtech? I think you get the jist of what I'm saying. Crappy made $320 of "profit" from that job. After subtracting all those items, how much "profit" did Crappy really make? Just because you're not on the job doesn't mean you're not "on the job". Final thought; just attended a business seminar conducted by Trane and one of the big points was if you're not charging $200 an hour you're killing yourself for the very reason stated above.
                            Buy cheap, buy twice.

                            Comment


                            • #29
                              Re: Flat rate pricing

                              charge me $200 an hour and i will learn how to do it myself, heck it is a sad day that the auto repair shop near me only charges $75 an hour and they do plumbing(muffers, brake lines, gas lines, cooling systems) then they do hvac on them also they must be cerified welders eletritions and now they must need to know computers sensoer and so on all for $75 an hour, yet SOME of you think you need to make $200 an hour ........................... please get real and while you are at it get a life
                              9/11/01, never forget.

                              Comment


                              • #30
                                Re: Flat rate pricing

                                and the fact i cant spell worth a hill of beans by no means i don't know when i am being ripped off or not!!!!
                                9/11/01, never forget.

                                Comment

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