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Over-Charged?

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  • #31
    Re: Over-Charged?

    Originally posted by freddy View Post
    At the end of the day, I guess its really up to the consumer to decide. http://www.phccweb.org/FactsandStats...temNumber=2685
    Way to go crappy days, keep moving your company to new levels.
    great your quoting someone from march of 2003 that is no longer a contractor that did a little survey on pricing of air conditioning repairs with 3% of the co's using flat rate.

    lets be realistic. there are 10 times more calls on plumbing than there is on a/c. there is also a thousands times more of a variety of calls for plumbing than there is for a/c. we are talking residential correct.

    freddy, is there a reason why no one knows what business your in or where you conduct that business?

    you seem to be very pro flat rate. but nobody knows what or where you do it.

    if flat rate is so great, why do i get so many new customers from people that tried flat rate? all i ever hear from them and ever see from their invoices are horror stories.

    why is it that 1 of the first and largest flat rate companies in the usa has 24 trucks in his local area yard in the morning and at any given time in the day still has 19 trucks in the yard? maybe the pubic has gotten wise maybe the system that once was thought good for the consumer, has actually backfired and the tables are turning back to a competitive time and material price.

    why is it that i deal with home owner associations and management co's on a daily basis, and they don't deal with flat rate co's? maybe because they know better

    even an ebay seller is listing cd copies of flat rate pricing. he only has a 74% feedback score. he can't even deliver the product without controversy

    rick.
    phoebe it is

    Comment


    • #32
      Re: Over-Charged?

      thank you westcoast/ robert for answering my questions

      i appreciate your comments too.

      i just don't agree with the pricing thing.

      if you were to hypothetically rework your bill to a time and material cost. what do you see as the average savings to the customers?

      please base this on average/ not on 1 particular job.

      thanks, rick.
      phoebe it is

      Comment


      • #33
        Re: Over-Charged?

        Originally posted by PLUMBER RICK View Post
        how about this one. my buddy who has a local plumbing shop in los angeles, just got news that his 72 year old mother in law who lives in colorado. just had a 40 gallon water heater replaced. was charged $2000. for the job.

        problem was that she didn't call her daughter or son in law first for a realistic price. the company is willing to give them a $300. refund

        rick.
        another update. it was an additional $600. to change the ball valve in the basement.

        so mark, your sons buddy got a deal my buddies mother in law got taken
        phoebe it is

        Comment


        • #34
          Re: Over-Charged?

          I chose the PHCC article because I think we can all agree, they are consistently looking out for what is best for the trades. Here are a few more , as I stated in previous post my business accountant also prefers flat rate as he has seen the benefit to the contractors that use it, and do not. Again this is a personal decision. I am not suggesting that the T&M guys are wrong. http://www.phccweb.org/FactsandStats...icles/May.htmlhttp://www.phccweb.org/search/Search...flat%20rate%20
          Last edited by Crappy days; 06-03-2007, 10:01 PM.
          THE GLASS IS ALWAYS HALF FULL

          Comment


          • #35
            Re: Over-Charged?

            Crappy,

            Glad to see you stuck around. We may not always agree but I can tell you flat-rate guys’ care about what you are doing. By the way you and crack need to go to Username School and pick out new names.

            You made a comment that you referenced the PHCC because we all know they care about the Trade. Of course the fact that flat-rate pricing was born by George Brazil with the help of the PHCC I’m not really sure they can be considered unbiased.

            The theory behind flat-rate pricing is fine. Whether we call it that or not Rick and I probably both have done flat-rating. There are certain jobs we do over and over again and because of that we can give a fixed price for the job over the phone. Those jobs include but are not limited to water heaters, regulators, garbage disposals, kitchen faucets, Tub and/or Shower valves, and so on and so on.

            I don’t know enough about yours or westcoast’s business to comment on the way you guys do business so I will try to speak in general terms. If a customer called me for a price for a 40-gallon water heater I would quote them an installed price for the heater with new piping on top and whatever work was required to rework the vent. If when I got to the door it turned out they needed additional work I would give them a price for the additional work. If the customer did not like the price I would thank them and excuse myself at no-charge to the customer. Most flat-rate companies would make the customer pay for a service call to get to the door and then give them the installed price. If the customer did not like the price the customer is still committed to pay the service call so most customers authorize the work. That little piece of work was George’s idea and he was real proud that it worked so well.

            For flat-rate pricing to be fair you need to look at your real-world costs then add your profit to arrive at an hourly rate. For your material costs you would do the same thing as with your labor. What you would not do is use an arbitrary figure someone else came up with based on imaginary costs and profit.

            During the last flat-rate discussion on this forum I posted the costs recommended by TradeService’s Plumber’s Pricing Manual. In this discussion someone mention a price was right out of the pricing manual which as it turns out it was. When you charge right out of the pricing manual it assumes you have the same costs as the company they used as a model. The model they used was a plumber making $22 per hour. In column 1 the labor rate would be $100 per hour (450% burden and profit), in column 2 the labor rate would be $150 per hour (665% burden and profit) and in column 3 the labor rate is $200 per hour (900% burden and profit). I’m not sure what company they used as a model but any company which needs to add 450-900% on top of their labor cost to make an “honest” living is doing something wrong. In addition, anyone who is using there labor rates as a model is no better off.

            The age old argument to support flat-rate over T&M has always been that the customer knows up front what the price will be. Why is it then that most flat-rate companies charge a service call to give the customer a price?

            Mark

            BTW: Are you going to meet us in Long Beach this Saturday for the PHCC Trade Show?
            Last edited by ToUtahNow; 06-04-2007, 12:55 AM.
            "Somewhere a Village is Missing Twelve Idiots!" - Casey Anthony

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

            Comment


            • #36
              Re: Over-Charged?

              Utah, I will not be at the show a matter a fact, I Will be in Utah. I agree with allot of the thoughts you and Rick have on flat rate. I do not Charge for Estimates during normal business hours 8 to 5 M-F. The most I have ever charged for a 50 gallon water heater was around 1400.00 to 1600.00 and that was with all the bells and whistles 12 year, EQ straps, ball valve, copper flex, Gas cock + flex and drip pan (not to mention a couple of flight of stairs). Also for any one who wants to learn more about Flat rate there are numerous articles on line. The cleaner has a couple along with many other magazines and columnists. I also stated in a post misdirected at Dog, that my family and I have a long history in the Automobile industry. After speaking with my uncle and several other family members who are old enough to remember when flat rate came out for the auto industries. I've come to the conclusion that it going to take another 10 to twenty years, for it to be received as it has in other industries. I think that anyone with an open mind can see that there are benefits to both ways of doing business. Of course even I do not flat rate everything.
              Last edited by Crappy days; 06-04-2007, 01:42 AM.
              THE GLASS IS ALWAYS HALF FULL

              Comment


              • #37
                Re: Over-Charged?

                Here are a few more sites that have information for flat rate if anyone is interested.
                http://www.accessmylibrary.com/comsi...d=0286-7026052
                http://www.callahan-roach.com/news.asp?article=011501
                http://www.contractormag.com/article...m?columnid=350
                http://www.contractingbusiness.com/2...le/False/6057/
                http://www.phccweb.org/FactsandStats...temNumber=2690
                http://www.cleaner.com/Articles/May.html
                THE GLASS IS ALWAYS HALF FULL

                Comment


                • #38
                  Re: Over-Charged?

                  This article is somewhat typical of the shortage world wide for plumbers. I know in my area. The lack of qualified tradesman has also caused prices to increase.
                  http://news.bbc.co.uk/1/hi/uk/4201882.stm
                  THE GLASS IS ALWAYS HALF FULL

                  Comment


                  • #39
                    Re: Over-Charged?

                    crappy,

                    Have a good time in Utah and stay safe. I just got back from Utah but I may head back up there tomorrow depending on how my day goes. I have two daughters in Logan but I generally only make it to Big Rock Candy Mountain unless their is family stuff in Logan.

                    There are dishonest T&M plumbers and there are dishonest flat-rate plumbers. Don't try and get too rich too fast and you will be fine. Flat-rate plumbing is almost 20-years old now and I'm sure it is here to stay.

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

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

                    Comment


                    • #40
                      Re: Over-Charged?

                      I will be in Orem for a day, and then we are going to bear lake for a reunion. I hope you have a good time and ejoy your family.
                      THE GLASS IS ALWAYS HALF FULL

                      Comment


                      • #41
                        Re: Over-Charged?

                        http://www.seattleplumber.com/flatrate_article.html
                        "Somewhere a Village is Missing Twelve Idiots!" - Casey Anthony

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

                        Comment


                        • #42
                          Re: Over-Charged?



                          Thanks for the article
                          sigpic

                          Robert

                          Comment


                          • #43
                            Re: Over-Charged?

                            I just found it amusing his shop is 1,100 + miles away from my shop and his recollection of the birth of flat-rate pricing for plumbing was the same as mine.

                            The article he wrote was in response to this story:

                            http://www.komotv.com/news/archive/4125166.html

                            Here is another story about the same outfit.

                            http://www.komotv.com/news/archive/4067086.html

                            These are the type of stories which give flat-rate companies a bad name. That does not mean all flat-rate companies are the same.

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

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

                            Comment


                            • #44
                              Re: Over-Charged?

                              I worked for a flat rate company in Seattle for about 7 years and the general opinion was that plumbserve and a couple other companies were jokes because of the way they charged. One of their guys came to work for me once and told me that the plumbers in his shop were required to bill out $2000 a day or they wouldn't last a week. This guy didn't last more than 3 months because he couldn't restrain himself from over charging.

                              I've always worked for flat rate companies, that's what I know, that's how my company charges. I've heard, and seen the horror stories of rapists. I run my company to be fair to the consumer and make a reasonable profit. repeat customers are the backbone of any buisness.

                              It's only the bad apples that get the press.

                              Brent.
                              Brent

                              Comment


                              • #45
                                Re: Over-Charged?

                                BAPLUMBER, Well said I could not agree more.
                                THE GLASS IS ALWAYS HALF FULL

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