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To compromise, or stand pat?

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  • #46
    Re: To compromise, or stand pat?

    At the end of the day mate you have to keep it worth your while. I once had a builder ask me to bail him out on several houses years ago and I worked on a flat day rate and went backwards severely in doing so! Dont let these cock sure wankers tell you how much your worth. Will they remember you when they are putting more and more money away after profiting extra because of your cuts in your rates. Work a few more and pull the rug out from under them when you have other options to fall back on!!!!!!!

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    • #47
      Re: To compromise, or stand pat?

      I’m always nervous when builders start pressuring for lower prices. You have no way of knowing the builders financial position, and if they get into financial trouble you are almost at the bottom of the creditor totem pole.

      I would rather stay home and make no money than work for free.

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      • #48
        Re: To compromise, or stand pat?

        The following words are attributed to John Ruskin. Some say he never wrote them. I say, "I wish I'd written them".

        It's unwise to pay too much, but it's worse to pay too little. When you pay too much, you lose a little money -- that is all. When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing it was bought to do. The common law of business balance prohibits paying a little and getting a lot -- it can't be done. If you deal with the lowest bidder, it is well to add something for the risk you run, and if you do that you will have enough to pay for something better.

        The buyer's of services will always want them for less. That's how most people are wired. Earlier in my business career, I was susceptible to such pressure. No mas! Now, for example, whenever I happen to cross paths with my biggest customer by dollar volume, he brings up the price argument. Without hesitation, I answer with, " I guess you're just going to have to get another plumber". If his customers are questioning why his plumber costs so much, it's his problem, not mine. He's got to do what's best for him. My statement to him speaks volumes for what's best for me.

        Lowering your price is a slippery slope. If you're not working, you'll go out of business. If you're working too cheap, you'll go out of business. It'll just take a little longer, and hurt a lot more.

        As a signatory (union) contractor who specializes in residential construction, I know a little about being too expensive. If the quality is there, the work will come. I know there are plenty of people in the Napa area, as in all areas, willing to pay for plumbing excellence. You just have to find them, and then, keep them. If it means tightening your belt over the short term, I hope you can manage it. It's time to diversify. Start working on your business, not in your business. The process is never ending. It applies to me as well as you.
        Good Luck,
        Scott

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        • #49
          Re: To compromise, or stand pat?

          I am a little concern you would have 15% to give back to the GC to begin with. If your bid is cost plus 10% profit and 10% overhead giving back 15% means you are working for free.

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

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

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          • #50
            Re: To compromise, or stand pat?

            Originally posted by ToUtahNow View Post
            I am a little concern you would have 15% to give back to the GC to begin with. If your bid is cost plus 10% profit and 10% overhead giving back 15% means you are working for free.

            Mark
            Mark,

            I never have done large bid jobs, but when you say "cost plus 10% profit", what is the meaning of profit to you? Do you pay yourself a certain wage and then add 10% onto that? Or how does that work?

            Thanks for any clarification you can give me

            By the way, sorry for hijacking this thread.
            YourHomeContractor.com - The Trusted Online Community For Homeowners and Contractors.

            Plumbing Reviews

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            • #51
              Re: To compromise, or stand pat?

              Originally posted by HouseOfAtlas View Post
              Mark,

              I never have done large bid jobs, but when you say "cost plus 10% profit", what is the meaning of profit to you? Do you pay yourself a certain wage and then add 10% onto that? Or how does that work?

              Thanks for any clarification you can give me

              By the way, sorry for hijacking this thread.
              It is not something you would do with service calls but you basically figure out ALL (material, trucks, insurance, labor, supervision, contengency, fuel, waste, cartage, design, permits, shop, etcetera) of your costs associated to do a job than you add an additional 10+10 on top of that.

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

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

              Comment


              • #52
                Re: To compromise, or stand pat?

                Walk away.

                Tell them thanks, but no thanks, keep me in mind for future jobs.

                But walk away.

                I agree with ToUtahNow.....cost plus 10 percent is losing money. In my business, we call them par deals. You always lose on par deals because there's only 10 percent in them.

                If they're trying to weasel a deal out of you BEFORE the job starts, they'll try and screw you during and after the end. They'll want you to throw some extras in, cover some unforeseen stuff, whatever.

                In the end, you'll be just as far ahead walking away before even getting started. If I'm gonna make ZERO, I'd rather do it when I'm sleeping, rather than after putting in a week of 12 hour days.

                There's too many individual homeowner jobs out there that have higher profit margins and less hassle. They'll pay more and be happier and throw you some more business. Cut to the bone jobs just get you more cut to the bone jobs. A year or two down the road, they'll dry up because they want the earlier, cheaper price.

                I deal with individual homeowners mostly. The commercial jobs for me are a roll of the dice - some come in, most don't. The ones that do come in, I make out like a bandit.

                In my experience, hagglers are never happy. You could give it to them for free and they'd STILL haggle.

                Besides, existing stuff is always easier to deal with then new construction. Too many variables that can change from blueprints/costing phase to construction phase. Stuff that can cost you time and money.

                If they wanna play, they gotta pay. And if you aren't making money at it, they're playing YOU......

                Just my 2 bits..........
                I'm on "The List" and I love it!!

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                • #53
                  Re: To compromise, or stand pat?

                  This would be an easy one;


                  Tell them as of today that you will no longer be their plumber, that your commitment is to complete any existing projects with them and insist that they seek the employment of another plumbing company.


                  This is a golden opportunity to grow some balls and see outside the realm of a bottom feeder company that has you going in reverse....not forward motion with today's expense schedules and taking discount work is something they must expect from you to begin with, otherwise they wouldn't be hammering you to drop.

                  You know damn right well they don't have a plumber beside thee quoting against you. Stab back and shut down your relationship.

                  When you act like you need them more than you need them, you put yourself in a very bad position as a business owner. You're a damn plumber ffs! Drum some work which won't be a problem and get out there and find somebody that isn't starving you out because you are allowing them to do so.

                  Stick up for yourself because no one else will. I for one won't comfort and console you on this matter because I've been in that boat before and laid down. There's a time when ALL good things come to an end and this isn't a good thing anymore.

                  Look outside the situation and you'll see that there's a ton of opportunities waiting.


                  All my pricing has went up in the past month. Everyone is holding with me and I'll be damned if I take a paycut for anyone in this time of the game.


                  There's no love lost when you kill the source of a growingly bad work relationship......whether you're mesmerized by the constant draw of money or not. Sell fruitcakes on ebay to get by but stand up for your reputation and make a wave.
                  Northern Kentucky Plumbers Twitter Feed | Plumbing Videos

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                  • #54
                    Re: To compromise, or stand pat?

                    Originally posted by ToUtahNow View Post
                    It is not something you would do with service calls but you basically figure out ALL (material, trucks, insurance, labor, supervision, contengency, fuel, waste, cartage, design, permits, shop, etcetera) of your costs associated to do a job than you add an additional 10+10 on top of that.

                    Mark
                    Thanks, Mark. I appreciate the explanation
                    YourHomeContractor.com - The Trusted Online Community For Homeowners and Contractors.

                    Plumbing Reviews

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                    • #55
                      Re: To compromise, or stand pat?

                      What are you compromising with? Your family's standard of living? "Sorry son, those braces have to wait 'cause dad had to come down 15% on a big job."

                      Your profit margin is important of course but never come down enough to where it cuts into what you have determined your personal pay must be.
                      I personally seldom add less than 25% profit of the selling price (overhead plus direct labor plus direct costs divided by .75 NOT mulitiplied by .25).
                      That's profit for the business. My personal salary is non-negotiable and I make sure we live well.
                      You do damn important work and should be compensated accordingly.
                      Make sure you pay yourself what your dog thinks you're worth (ALOT)

                      In other words, know your breakeven point. Once you reach that, everything is coasting since all of your salary, insurances, downtimes, maintenance etc in figured into that. If you have to come off your profit a little, it's not a killer.

                      And in the GC's defense, if you have come down on your prices in the past he may think you have figured enough in to do that. You've trained him.
                      "Man will do many things to get himself loved, he will do all things to get himself envied." Mark Twain

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                      • #56
                        Re: To compromise, or stand pat?

                        Dude,
                        walk away, but do it in a polite manner. It's all business. A good friend of mine in HVAC got me into a school district as the plumber. The maintenance boss went to much bigger district and took me, but cut my buddies throat. He played it cool for two years, I called him and said that the time was ripe, he called the maintenance boss and is now doing the HVAC at the new district. The funny thing is, he is now at both districts and I got my throat cut at the old district! My HVAC buddy and the maintenanace boss act like nothing happened, and don't talk about it. So, stay professional, and remember, it's business. I plumb for anybody that pays. Except last night, I was on an emergency call at a national seafood chain. I hadn't had my supper yet, I got all greasy and nasty fixing a water leak, right next to the broiler, so it was hot as hell. Fix that, start popping a cleanout because a drain backs up occasionally. The shift manager comes up and in a snippy manner demanded to know what I was doing that for. I replaced the plug, put the cover back on and told her I wasn't doing nothing now. That felt great.

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                        • #57
                          Re: To compromise, or stand pat?

                          Re: Bogarts' post.

                          I have quite a bit of experience servicing restaurants, and it seems the big, corporate franchises are the worst to work for.
                          Water Heater Reviews & Water Heater Information

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                          • #58
                            Re: To compromise, or stand pat?

                            The GC is definitely not cutting his price to the HO. He has found that your easy to get over on. The GC just sounds like he is a greedy sob. Stand pat, if his guys do it with out proper permits turn them in. If you want to work for free my company would be glad to hire you.
                            WE LIVE IN THE LAND OF THE FREE,
                            ONLY BECAUSE OF THE BRAVE

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                            • #59
                              Re: To compromise, or stand pat?

                              Been biting nails over this thread.
                              Greg, I really hope things turned out ok, let us know...if things didn't go well I think we could all cough up some decent idea's for you to market/advertize as a service company.

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                              • #60
                                Re: To compromise, or stand pat?

                                Originally posted by DuckButter View Post
                                Been biting nails over this thread.
                                Greg, I really hope things turned out ok, let us know...if things didn't go well I think we could all cough up some decent idea's for you to market/advertize as a service company.
                                It looks like some one forgot one of the first rules of plumbing.

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

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

                                Comment

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