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Jerseydaze
06-26-2008, 08:55 AM
I recently got hooked up with a central air company .And I am trying to figure out the best way to charge them. They are mostly updating old systems so the jobs are small for me an example is yesterday I went to a job and brought stuff up to code add a switch and receipt in attic,add a WP gfi outside also I added a 240 v circuit and switch for new blower old was 110 .We were in and out in 2.5 hours I feel like I work fast there for T&M I am working myself out of money.Opinions pls

masterinbama
06-26-2008, 09:06 AM
I would figure a minimum charge + T+M. I do trailer connections for a few local parks almost always the existing flex and wire is long enough so I am only on site about 30 minutes and I can pull permits online so my total time is less than 1 hour.My minimum is $150 + permit cost

Sparky555
06-26-2008, 09:30 AM
One of the downsides to T&M is that as you gain experience, use time-saving tools and get more productive...you're paid less unless you raise your hourly rate to match your increased productivity.

Dave

emahler
06-26-2008, 09:50 AM
One of the downsides to T&M is that as you gain experience, use time-saving tools and get more productive...you're paid less unless you raise your hourly rate to match your increased productivity.

Dave

Good luck with that. Most consumers are unable to do simple math. They only comprehend the rate, they are unable to factor in and multiply time.

growler
06-26-2008, 09:56 AM
We were in and out in 2.5 hours I feel like I work fast there for T&M I am working myself out of money.Opinions pls


You said we were in and out in 2.5 hours. I take there were two of you. That's 5 man hours right there. How much time to get the permit? If I can't get a permit on line it will take at least another hour to get a permit.
OK we are billing for 6 man hours at normal rate, plus travel and Admin. plus a fuel sur-charge, plus materials and markup. plus permit cost.

If your normal rate is high enough then you shouldn't be hurting on this job. Remember on small cost materials the mark up is very high ( normally around 100% ).

jimmyglen
06-26-2008, 10:08 AM
Time and Material can be a good way for someone to hire a contractor (and most people dont like it) if the electrician is good

if you are good you can more money bidding your work

but if these guys are good pay and its steady work - I would keep it

480sparky
06-26-2008, 12:10 PM
One of the downsides to T&M is that as you gain experience, use time-saving tools and get more productive...you're paid less unless you raise your hourly rate to match your increased productivity.

Dave

That's why you :
1. increase your hourly rate
2. do more than one job in a day.

1. I often ask people, who ask about my hourly rate, "Would you rather pay me $100 and hour and have the job done in two hours, or pay someone else $50 an hour for 8 hours?"
2. At least once a week, I do more than one service call a day. I've managed to do 5 in one day.

emahler
06-26-2008, 12:46 PM
That's why you :
1. increase your hourly rate
2. do more than one job in a day.

1. I often ask people, who ask about my hourly rate, "Would you rather pay me $100 and hour and have the job done in two hours, or pay someone else $50 an hour for 8 hours?"
2. At least once a week, I do more than one service call a day. I've managed to do 5 in one day.

Holy crap. Number two, the way you have written it, might as well go work hourly for someone else.

480sparky
06-26-2008, 12:53 PM
Holy crap. Number two, the way you have written it, might as well go work hourly for someone else.

7 - 8 ; Replace toggle switch at 1234 Main
8 - 10 ; Install ceiling fan at 4321 Jones
10 - 11:30 ; Locate & repair short circuit at 9876 Oak
12 - 2 ; Install dimmers at 6789 Pine
2 - 3:30 ; Install A/C circuit at 2468 Court

emahler
06-26-2008, 01:18 PM
7 - 8 ; Replace toggle switch at 1234 Main
8 - 10 ; Install ceiling fan at 4321 Jones
10 - 11:30 ; Locate & repair short circuit at 9876 Oak
12 - 2 ; Install dimmers at 6789 Pine
2 - 3:30 ; Install A/C circuit at 2468 Court

i prefer:

8-12 : install ceiling fan, install fan speed control, install gfci's in kitchen, bath and exterior at 1234 main st

12-1:lunch

1-4 : take your pick...

anyone who runs serious resi service will tell you this:

windshield time is an Overhead thief. You want to limit your drive time as much as possible. When we ran resi service, our target was no more than 3 call/day/truck...increase the revenue of each ticket, decrease the number of jobs needed (lowering the costs of acquiring jobs), decrease the amount of drive time (lowering the costs of downtime) and be able to spend the time giving the customer exceptional service.

Your day is the description of a typical small EC that is flying by the seat of his pants with no plan, nor direction.

It's an incredibly inefficient, and less profitable, way to operate. You'd be better off just doing projects, or really running service. But, good luck with it...

btw: with that schedule, you might as well go work hourly for someone else...at least you will get paid for your downtime at your actual rate

480sparky
06-26-2008, 01:34 PM
So you're saying if you can't get a job that takes at least 4-5 hours, you don't want it? Fine with me. I charge windshield time anyway.

And I don't appreciate the implication that I have to plan or no direction. I DO have a plan.... take care of a lot of small jobs on the same day, so I don't spend half a day driving to one job, then half the day driving to the next one, then half a day driving to the third one. It's called LOGISTICS. Try it sometime.

Plus, this is not an everyday schedule. Maybe ONCE A YEAR can I do this.

And with this type of schedule, I do very well, thank you. It's called filling a niche market.

emahler
06-26-2008, 01:38 PM
So you're saying if you can't get a job that takes at least 4-5 hours, you don't want it? Fine with me. I charge windshield time anyway.

And I don't appreciate the implication that I have to plan or no direction. I DO have a plan.... take care of a lot of small jobs on the same day, so I don't spend half a day driving to one job, then half the day driving to the next one, then half a day driving to the third one. It's called LOGISTICS. Try it sometime.

Plus, this is not an everyday schedule. Maybe ONCE A YEAR can I do this.

And with this type of schedule, I do very well, thank you. It's called filling a niche market.

i'm saying we take those 1 hour calls and turn them into 4 hour calls...

we would take those $175 service calls and turn them into $600 calls, with happier customers. My overhead was the same for a $175/call as it was for the $600 call. Cost me the same to mobilize a tech, the same to answer the phone call, the same to get that customer to call me...i just made more profit.

running around 8 hrs a day, doing 5 calls and billing $100/hr t&m is a losing proposition.

you might as well go take a job working for someone else. at least then you only have 1 boss.

like i said, good luck.

solaeros
06-26-2008, 02:02 PM
Emahler;

Kinda sounds like you're "REAMING" the customer. In my area you would get lynched coming in and cuddling up to the customer in order to work out an additional $400.00 per call.

emahler
06-26-2008, 02:19 PM
Emahler;

Kinda sounds like you're "REAMING" the customer. In my area you would get lynched coming in and cuddling up to the customer in order to work out an additional $400.00 per call.

Not at all. But your comment is indicitive of the problems with our industry.

Seriously, what is wrong with saying "mrs. Jones, I noticed that you have ceiling fans in all your bedrooms, but 1 switch controls both the fan and light. And you have to use the pull chain to operate them separately. We can install remote kits that allow to control them seapately from anywhere in the room. We can install them today for $125/ea. Would you like us to do that?"

Tell me how that is remotely close to "REAMING"?

I'm sorry our industry is full of self hating, bass ackwards, simpletons who are afraid of anything remotely associated with financial success.

Do you think for one second that any of your customers care whether you can afford to take your family out for a steak dinner? Or if you can only afford to feed them macaroni and cheese?

It's not about taking advantage of them. It's about selling them your knowledge, experience and expertise. Not just selling them your time and soul.

Carry on.

iwire
06-26-2008, 02:42 PM
I'm sorry our industry is full of self hating, bass ackwards, simpletons who are afraid of anything remotely associated with financial success.

So there you go, you either do it emahler's way or your a simpleton. :roll:

solaeros
06-26-2008, 02:45 PM
I think some one woke up on the wrong side of the bed.

Nothing is wrong with upselling or trying to minimize overhead expenses. But your post your gave "me at least" the impression that you want your guys "milking" a 1 hour job for 4 hours. "It's all in how you phrase things." And what defines success in your mind? Net income, Material belongings, Happiness? I have a great Net, own properties in Hawaii, and along the Henry's Fork river near Yellowstone Nat. Park. But that's all pretty meaningless if your not Happy. Not trying to brag but I believe you're assuming too much of others you really don't know

ike5547
06-26-2008, 02:46 PM
We can install remote kits that allow to control them seapately from anywhere in the room. We can install them today for $125/ea. Would you like us to do that?"


And when 'Mrs. Jones' says no thank you, what then? Screen her calls and black list her?

ike5547
06-26-2008, 02:55 PM
So there you go, you either do it emahler's way or your a simpleton. :roll:

His customers (simpletons?) seem to good to be true. I work with alot of intelligent and successful people that are not so easy to manipulate as he has described. If I screened them all out I wouldn't have much left.

I suspect a little exaggeration is taking place.

emahler
06-26-2008, 02:57 PM
So there you go, you either do it emahler's way or your a simpleton. :roll:

Bob, I wish I could take credit for this being my way. But there are large organizations out there who have already proved this true.

480sparky
06-26-2008, 03:05 PM
i'm saying we take those 1 hour calls and turn them into 4 hour calls.......

So you would be more than happy to overcharge your customer because you have no other job to go to? I call that a scam.

If it takes half an hour to do an oil change on your car, do you happily pay $200 for it becuase the mechanic took his time, goofed off, smoked half a pack, then said it took him 4 hours?

If I can charge $100 an hour, PLUS MY TRIP CHARGES AND MILEAGE, I do pretty good for a day.

That, and the fact that when I walk away from the (small) job, the customer has three things: 1. EXACTLY what they wanted, and no hard-sell for any more. Folks appreciate that more thany anything. 2. A proper job, professionally done. 3. Several business cards. I always give them four or five. I know perfectly well that they will recommend me to others.

But what do I know? I'm flying by the seat of my pants and have no plan or direction....

ike5547
06-26-2008, 03:07 PM
So you would be more than happy to overcharge your customer because you have no other job to go to?
He probably does have other and much larger jobs to go to. That could be why he can afford to be so selective on the smaller ones.

When I have larger ongoing projects I tend to become a little more selective myself.

480sparky
06-26-2008, 03:14 PM
He probably does have other and much larger jobs to go to. That could be why he can afford to be so selective on the smaller ones.

When I have larger ongoing projects I tend to become a little more selective myself.

I have larger jobs as well. But I also get calls for the smaller jobs as well.

I would rather take care of those people than to turn them down. Who knows where that small job will lead to? I once did a very small job as we have been discussing. Turns out she works for an international shipping company, and I ended up with a nice national account out of the deal.

It's just I don't drop everything I'm doing to go do those small jobs. I group them together and do them all in one day. The same way you get in your car and go to the bank, dry cleaners, post office, grocery store, then pick up the kids at the pool on the way home.

If we all were huge ECs doing malls, school, hospitals and the like, and didn't do small jobs, who would take care of the homeowners of the country?

emahler
06-26-2008, 03:14 PM
Holy christmas.

Solerno's- good for you. Did you make money running a resi/lt commercial service company? Or doing primarily projects w/ a little service to your existing customers and a few referrals.

Ike - if you think using your knowledge to make your customers lives more comfortable, is manipulating them, than you prove my theory.

It's not about milking, or reaming, or manipulating. We did resi flat rate. That means, the quicker we got the task done, the more we made.

However, do your customers all read EC mag? EC&M? Do they keep up with all the new items in the industry? No. But you do, or at least should.

If all your selling them is your time, then stop wondering why they hire someone cheaper.
It's entirely too easy to blame losing a job to someone being cheaper. Its much more difficult to look in the mirror and say "I didn't give them any reason to believe that I'm worth more. I couldn't sell myself"

emahler
06-26-2008, 03:18 PM
So you would be more than happy to overcharge your customer because you have no other job to go to? I call that a scam.

If it takes half an hour to do an oil change on your car, do you happily pay $200 for it becuase the mechanic took his time, goofed off, smoked half a pack, then said it took him 4 hours?

If I can charge $100 an hour, PLUS MY TRIP CHARGES AND MILEAGE, I do pretty good for a day.

That, and the fact that when I walk away from the (small) job, the customer has three things: 1. EXACTLY what they wanted, and no hard-sell for any more. Folks appreciate that more thany anything. 2. A proper job, professionally done. 3. Several business cards. I always give them four or five. I know perfectly well that they will recommend me to others.

But what do I know? I'm flying by the seat of my pants and have no plan or direction....

Did you feel the wind when the point flew right over your head?

480sparky
06-26-2008, 03:21 PM
Did you feel the wind when the point flew right over your head?

I couldn't. I'm too busy flying.

iwire
06-26-2008, 03:21 PM
As long as your up front with your pricing, which emahler is, I don't think it is possible to over charge.

Do some Google shopping, you can find fancy pens for $5,000, sneakers for $2,000 are those companies scamming or reaming anyone?

IMO no, some people like to pay more for what they think is better.


The only thing I was giving emahler a hard time about is resorting to calling people names that do not agree with him.

emahler
06-26-2008, 03:28 PM
480.and Ike. Take solice that you are not alone.

When we did resi service, that's all we did. We didn't have larger jobs going. We just focused on resi service. We had more calls than we could handle most days. But our belief was that the customer we were at, was all that mattered. Now we were running 5-7 trucks 10 hrs a day 6 days a week. So we could handle some schedule differences.

These days we rarely touch these calls anymore. Just not what we are set up for.

Again, think logically. How is me telling a customer about something I think they might like, giving them all the facts (including price) and letting them make an informed decision, anything but the right way to do it?

Remember, we weren't T&M. We couldn't dog it.

emahler
06-26-2008, 03:31 PM
As long as your up front with your pricing, which emahler is, I don't think it is possible to over charge.

Do some Google shopping, you can find fancy pens for $5,000, sneakers for $2,000 are those companies scamming or reaming anyone?

IMO no, some people like to pay more for what they think is better.


The only thing I was giving emahler a hard time about is resorting to calling people names that do not agree with him.

They weren't directed. They are industry wide. And the sad fact is they are accurate.

This board represents less than what, 5%, of our industry? And some of the better members of our industry at that?

480sparky
06-26-2008, 03:36 PM
480.and Ike. Take solice that you are not alone.

When we did resi service, that's all we did. We didn't have larger jobs going. We just focused on resi service. We had more calls than we could handle most days. But our belief was that the customer we were at, was all that mattered. Now we were running 5-7 trucks 10 hrs a day 6 days a week. So we could handle some schedule differences.

These days we rarely touch these calls anymore. Just not what we are set up for.

Again, think logically. How is me telling a customer about something I think they might like, giving them all the facts (including price) and letting them make an informed decision, anything but the right way to do it?

Remember, we weren't T&M. We couldn't dog it.

In other words, I'm filling the void that you left. As I said before, I'm filling a niche. You just outgrew it. Fine with me. Just let me do it.....

http://i166.photobucket.com/albums/u87/lexnder/Frank-Sinatra-My-Way-148950.jpg.

iwire
06-26-2008, 03:39 PM
They weren't directed. They are industry wide. And the sad fact is they are accurate.

It's not a fact, it is your opinion.

This board represents less than what, 5%, of our industry? And some of the better members of our industry at that?

I would say the electricians that have become more businessmen then electricians do not hang out at code forums, they are off selling.

Many ECs are excellent electricians but less then stellar businessmen, that does not mean they are 'self hating, bass ackwards, simpletons who are afraid of anything remotely associated with financial success.'

It just means their priorities in life are not the same as yours.

ike5547
06-26-2008, 03:41 PM
They weren't directed. They are industry wide. And the sad fact is they are accurate.

This board represents less than what, 5%, of our industry? And some of the better members of our industry at that?

If I were to tell you my former employer retired at the age of 56 worth tens of millions of dollars and did not follow 'your' business plan would that surprise you? Would you even credit it?

emahler
06-26-2008, 03:51 PM
If I were to tell you my former employer retired at the age of 56 worth tens of millions of dollars and did not follow 'your' business plan would that surprise you? Would you even credit it?

I would ask 2 things.

1) What market was he in?
And
2) What year did he retire?

And I would give him all the credit in the world. He beat the long odds. Good for him.

Question #3 - how close are you to retiring at 56, and being worth that kind of money?

emahler
06-26-2008, 03:57 PM
It's not a fact, it is your opinion.



I would say the electricians that have become more businessmen then electricians do not hang out at code forums, they are off selling.

Many ECs are excellent electricians but less then stellar businessmen, that does not mean they are 'self hating, bass ackwards, simpletons who are afraid of anything remotely associated with financial success.'

It just means their priorities in life are not the same as yours.

Yet, they'll debate against proven systems and track records? Citing exceptions as the rule?

And bob, when multiple sources can be cited, it ceases being opinion.

ike5547
06-26-2008, 04:15 PM
I would ask 2 things.

1) What market was he in?
And
2) What year did he retire?

And I would give him all the credit in the world. He beat the long odds. Good for him.

Question #3 - how close are you to retiring at 56, and being worth that kind of money?

1. San Francisco

2. 2003. The same year I started contracting.

3. Ain't gonna happen. My point is that some individuals are better at this (making money) than others and there is no exclusive business model that works.

He still pays 100% of mine and others health insurance and retirement for those who did so in his service.

ike5547
06-26-2008, 04:18 PM
Yet, they'll debate against proven systems and track records?

No one is debating your track record. The debate concerns your assumption that yours is the only way to be successful.

ike5547
06-26-2008, 04:28 PM
I assume that there are some who have tried a flat rate system and failed. We just aren't hearing about those. Just saying it may not be the magic bullet it's being portrayed as and it may not work in every market.

iwire
06-26-2008, 04:41 PM
And bob, when multiple sources can be cited, it ceases being opinion.

Forget it, there is no outside reference to back your view that electricians do not do it like you choose to are 'simpletons or self hating'.

You where simply being rude for no reason other then ego stroking.

mivey
06-26-2008, 04:59 PM
Forget it, there is no outside reference to back your view that electricians do not do it like you choose to are 'simpletons or self hating'.

You where simply being rude for no reason other then ego stroking.But he has multiple sources (quote from another thread):roll: :

I've had the opportunity to meet and work with hundreds of contractors from NYC to California and everywhere in between.

I've had the opportunity to meet some of the greatest business minds in our industry, and just learn from others.From posts I've read, arguing with emahler is useless. He is completely self-confident and convinced he has the only viable solution and those that are successful by other methods are the exceptions to the rule. I do agree with his stand that many ECs (and other businesses for that matter) don't include all of their costs in their rates.

I'm glad he is able to be successful with his method. I'm also glad others are successful with their methods (and yes emahler, they are successful).

480sparky
06-26-2008, 05:27 PM
http://i214.photobucket.com/albums/cc172/480sparky/elecfordummies.jpg

Sorry, I just couldn't resist!

mivey
06-26-2008, 05:36 PM
http://i214.photobucket.com/albums/cc172/480sparky/elecfordummies.jpg


Sorry, I just couldn't resist!That's funny.:grin: Now I'm going to have to look up this cadpoint translation stuff as this is the second time I've seen it in a post.

emahler
06-26-2008, 05:55 PM
Ike - I meant what market segment of the industry.

Bob - I personally get tired of people in this industry (not just here) complaining about the same things year after year, but doing the same thing year after year. A sense of frustration sets in. What's the definition of crazy?

480 - that was funny. Can I save it and use it?

It's not even my way. Google Frank Blau. But if you have a method with a 70% success rate vs. 1 with a 40% success rate, well you get the idea.

Now personally, I don't have a horse in this race anymore. I just hate seeing plumbers and hvac contractors brag about taking month long vacations, and ec's brag about working retarded hours to make a living.

ike5547
06-26-2008, 06:24 PM
Ike - I meant what market segment of the industry.


It really wasn't confined to a particular segment really. We did almost everything. All over the San Francisco Bay Area but mostly within the city. New construction residential and commercial, remodel, service work, supermarkets, malls, chain stores, etc...

You're right about him being an exception to the rule, but on a personal level. He was totally relentless. Worked long, long hours, planned and organized exceptionally well. Also, he didn't make that amount of money by sticking his profits in a piggy bank but by investing it in real estate and lots of it.

My point is that making money in contracting isn't restricted to a single system. IMO, It comes down to the innate nature and abilities of the person running the system. If you don't have certain prerequisites no system will work for you.

In my opinion, even a flat rate system has to be implemented by the right kind of person. That aside, I no of no flat rate electricians in S.F. so I'm not sure it would work out here very well.

480sparky
06-26-2008, 06:38 PM
Ike - I meant what market segment of the industry.

Bob - I personally get tired of people in this industry (not just here) complaining about the same things year after year, but doing the same thing year after year. A sense of frustration sets in. What's the definition of crazy?

480 - that was funny. Can I save it and use it?

It's not even my way. Google Frank Blau. But if you have a method with a 70% success rate vs. 1 with a 40% success rate, well you get the idea.

Now personally, I don't have a horse in this race anymore. I just hate seeing plumbers and hvac contractors brag about taking month long vacations, and ec's brag about working retarded hours to make a living.

Goat head. I mean, Go ahead! :grin:

JES2727
06-26-2008, 06:40 PM
When I started contracting several years ago I was a bass-ackwards simpleton, there's no doubt about it. My business is still evolving in a half-fast kind of way but I pay attention to every bit of information emahler is willing to share. It's good stuff.

emahler
06-26-2008, 06:46 PM
Ike,

I know a lot of guys who do resi service @ $70/hr/man and make a nice profit every year. The fact is, they would make a nicer profit if they didn't do that service work, all it does is cost them money. But since they don't break it out, they really never know.

When I talk about this stuff, its as a true service company. Not an installation company that does service on the side.
I also know guys like your former boss. Many of them made their money in contracting 20 years ago. Now they make their money on the investments they made 20 years ago, not their contracting business.

ike5547
06-26-2008, 06:47 PM
I pay attention to every bit of information emahler is willing to share. It's good stuff.

I agree. His presentation could use some work, however, and some of his assumptions are over generalized.

ike5547
06-26-2008, 07:12 PM
I apologize. My comment in #46 seems kind of mean and unnecessary.

iwire
06-26-2008, 07:19 PM
It's good stuff.

It is good stuff, but it ain't Gospel. :)

emahler
06-26-2008, 07:24 PM
Don't worry Ike, you are right. However, since I am not running a seminar and charging for this information, I really don't care.

How far off are most of my assumptions anyway? Almost never 180degrees. Usually like 10 or 20 degrees.

480 - is it too late to change the title of that book to "Electrical Service Contracting". That would be more accurate. Thanks a lot Goathead (I'm assuming that's a term of endearment in the fields of I
Iowa:D)

emahler
06-26-2008, 07:29 PM
It is good stuff, but it ain't Gospel. :)

Actually Bob, for resi/lt commercial service it really is gospel. And I don't take credit for it

jmsbrush
06-26-2008, 07:40 PM
Mr Emahler. I don't think you are wrong for trying to upsell to a customer. I agree with you on this and I have only been a contractor for 10 months now and I get what you're saying! I just started flat rating I hope it goes well for me.

iwire
06-26-2008, 07:52 PM
Actually Bob, for resi/lt commercial service it really is gospel.

Damn, someone with a bigger head then my own. :grin:

I have learned a lot for your posts and you have even changed my views on some of it but there is nothing in this world with a one size fits all answer.

Again, your definition of success is not everyones idea of success and it is not the 'correct' definition of success.

peter d
06-26-2008, 07:57 PM
Again, your definition of success is not everyones idea of success and it is not the 'correct' definition of success.

I certainly agree with that, but to work slavish hours as an EC for marginal returns is not something that I aspire to do in life. For the amount of money, time, investment and risk it takes to be successful in this business, I would want to be richly rewarded for it. I think that's all Erik is "preaching" against is EC's who sell themselves short when there is no good reason for them to do so. :)

emahler
06-26-2008, 08:01 PM
Damn, someone with a bigger head then my own. :grin:

I have learned a lot for your posts and you have even changed my views on some of it but there is nothing in this world with a one size fits all answer.

Again, your definition of success is not everyones idea of success and it is not the 'correct' definition of success.

bob, I agree. But I'm talking to contractor w/ a couple of employees whose looking to build his company. I'm not talking to the guy who wants to work by himself, or the guy who wants to go after large installs and new construction. I've stated that many times before

aline
06-26-2008, 11:34 PM
There are many ways to get to your destination.

You can walk.
You can run.
You can ride a bike.
You can drive a car.
You can go by boat.
You can take a train.
You can fly.

I guess the important thing is to determine where you want to go and when you want to get there. Then it's just a matter of choosing the right method to get you to your destination at the desired time. Some methods will get you their faster than others. Choose the wrong method and you may not get there at all.

adamants
06-27-2008, 06:29 AM
In my opinion, even a flat rate system has to be implemented by the right kind of person. That aside, I no of no flat rate electricians in S.F. so I'm not sure it would work out here very well.

go for it, i am changing over at the moment and it is working out awesome! no regrets.:)

iwire
06-27-2008, 07:43 AM
but to work slavish hours as an EC for marginal returns is not something that I aspire to do in life.

Pete when did I even come close to suggesting that? :-?


For one I thought this thread was about owners, not the workers. For another thing what I meant was this.

Some owners aspire to run ever expanding companies with no limit to their dreams. These folks take more pride in the business they have built then the work their employees do. That is great, the economy needs those folks. :smile:

Another group of owners is happy working for themselves, with no one else or just a few guys. They don't want a large company, they take more pride in the work then in the business. That is also great, there is room for them as well.:smile:

And of course there are owners that fall somewhere in between.

I am in another group, I do not have the drive, ability or desire to run a business. It's just not what I want out of life, I work to live, not live to work.


Brian John seems to be a guy that lives to work and if that is what he likes then thats great, although it may have taken a toll on his health.

emahler
06-27-2008, 07:52 AM
Pete when did I even come close to suggesting that? :-?


For one I thought this thread was about owners, not the workers. For another thing what I meant was this.

Some owners aspire to run ever expanding companies with no limit to their dreams. These folks take more pride in the business they have built then the work their employees do. That is great, the economy needs those folks. :smile:

Another group of owners is happy working for themselves, with no one else or just a few guys. They don't want a large company, they take more pride in the work then in the business. That is also great, there is room for them as well.:smile:

And of course there are owners that fall somewhere in between.

I am in another group, I do not have the drive, ability or desire to run a business. It's just not what I want out of life, I work to live, not live to work.


Brian John seems to be a guy that lives to work and if that is what he likes then thats great, although it may have taken a toll on his health.

Bob, i agree....there are some business basics that everyone should have to know...i.e P&L, breakeven, etc...but beyond that, the problem on this site is that too many of this group:
Another group of owners is happy working for themselves, with no one else or just a few guys. They don't want a large company, they take more pride in the work then in the business. That is also great, there is room for them as well.:smile:

make pretend that their methods will work for this group
Some owners aspire to run ever expanding companies with no limit to their dreams. These folks take more pride in the business they have built then the work their employees do. That is great, the economy needs those folks. :smile:

which wouldn't be a problem, if many guys in group 2 weren't young and just learning the business. they have aspirations to grow, but get faulty advice from someone who has no intention of growing. Hence, me being so adamant about presenting the other side.

and as i've stated numerous times, i'm speaking to a specific target audience.

iwire
06-27-2008, 08:08 AM
make pretend that their methods will work for this group

I don't have to pretend, I am sure those methods can work. :smile:

But check this out. 8-)

I think many people who go in business like to do things their own way.

That is way they stopped working for the man.

which wouldn't be a problem, if many guys in group 2 weren't young and just learning the business. they have aspirations to grow, but get faulty advice from someone who has no intention of growing. Hence, me being so adamant about presenting the other side.

I hear you but I am not one that believes in hand holding, if I was to make the move to start a business it would be my responsibility to do the research and learn the ropes.

You do realize that some of young guys trying to run and grow a business have to go out of business. There is only so much room and just because someone has the desire to run a shop does not mean they will every have the skills to do so successfully flat rate or not.



and as i've stated numerous times, i'm speaking to a specific target audience.

It is not how it comes across.

To me it comes across as an arrogant, (a subject I know about :wink: ) big headed guy that thinks he knows how every EC should run his operation. Not trying to start crap here just letting you know how I see your posts and I don't run a business.


Again let me say it clearly

You have a lot of good information and I hope you keep presenting it. 8-)


Could you just not call people names who don't want to follow your suggestions? :smile:

emahler
06-27-2008, 08:34 AM
I don't have to pretend, I am sure those methods can work. :smile:

But check this out. 8-)

I think many people who go in business like to do things their own way.

That is way they stopped working for the man.



I hear you but I am not one that believes in hand holding, if I was to make the move to start a business it would be my responsibility to do the research and learn the ropes.

You do realize that some of young guys trying to run and grow a business have to go out of business. There is only so much room and just because someone has the desire to run a shop does not mean they will every have the skills to do so successfully flat rate or not.





It is not how it comes across.

To me it comes across as an arrogant, (a subject I know about :wink: ) big headed guy that thinks he knows how every EC should run his operation. Not trying to start crap here just letting you know how I see your posts and I don't run a business.


Again let me say it clearly

You have a lot of good information and I hope you keep presenting it. 8-)


Could you just not call people names who don't want to follow your suggestions? :smile:

i could, but it's not as much fun:D

as i've also stated, if this were a seminar and I was charging money, i'd care about presentation.

I think it's even worse when Group 2's employees try to give advice to Group 1 guys...

but no, this is all for resi/lt commercial service for the small contractor looking to grow...

doesn't apply to new construction, large commercial installs, industrial, etc.

jimmyglen
06-27-2008, 09:28 AM
[QUOTE=emahler]Ike,

I know a lot of guys who do resi service @ $70/hr/man and make a nice profit every year. The fact is, they would make a nicer profit if they didn't do that service work, all it does is cost them money. But since they don't break it out, they really never know. /QUOTE]



this is the case with a lot of contractors

some guys make a ton of dough and never really look the numbers over, they just keep working hard and banking the cash

khixxx
06-27-2008, 10:26 AM
Man to bad we couldn't set this thread up on a you tube debate. What about charts like Ross Perot has? anyone have any?

I guess I am a # 2 guy so take it as you will. I would do a list price or a flat rate for your upgrades, unless you get into some thing very very crazy might just be best to raise your rates, but you might lose the work altogether. Maybe focus on your niche and work with this guy till things get rolling?

I have learned lots from Emhaler. His and others on this forum have said good and bad advice to everyone. I guess I have been pretty good at picking up the best advice and running with it. I use to only invest $2k a year. YTD I am at $40k. I am more interested in passive income.

If you want to change the Electrical Contracting industry just regulate it more. Talk to you state about passing laws were only legit ECs can purchase electrical equipment.

iwire
06-27-2008, 10:47 AM
Talk to you state about passing laws were only legit ECs can purchase electrical equipment.

I hope that never happens.

Are you telling us that you don't do home DIY projects?

This country was built by DIYs and that should always be an option.

Here in MA only plumbers can legally install plumbing, it is against the law for HOs to do their own plumbing work.

Yet it is still legal to buy plumbing supplies and I do so at a professional plumbing supply house. I can't say they are happy to serve me but they do and the quality is better then the big box stores.

aline
06-27-2008, 10:57 AM
My A/C condensing coils were frosting up. I cleaned the coils and made sure I had a clean filter in for proper air flow but they were still frosting up so I called an A/C company to come out to check the freon charge.

I was expecting to pay at least $200 to $300 for this service.
They checked the A/C system, charged the system, tested temperatures and checked for leaks. The total bill was $106.50. $69 in labor and $37.50 for the freon.

Although I was happy that it was so cheap at the same time I was also dissapointed that they did this for so little money. I want over a hundred dollars for labor alone for any service call. Pricing like this doesn't help any of us. I was also a little bummed that he didn't try to upsell anything to me. He should have been trying to increase that ticket. I can't see where he made any money so why even bother doing it. Does he think I'm going to remember him years later if I decide to buy a new unit and purchase it from him? I probably won't remember who came out.

He didn't bother to leave a sticker on the unit or a business card either. I would have plastered my sticker over the sticker of the guys that installed the unit in the first place.

Electricians aren't the only ones not charging enough.
Even some HVAC companies don't know what they should be charging.
$69 labor for a service call?

Would I've been happy if he had charge me $200 to $300 for this service?
Yes. It was what I was expecting.

Would I've use the guy again?
Yes.

I should have given him a copy of one of my Frank Blau articles. :)

iwire
06-27-2008, 11:11 AM
I had two plumbers to my home on a Sunday for an emergency. (My Two year old flushed the TP paper holder :grin: )

They said $300 on the phone, once they got there it went quick and they dropped the charge to $125.

Of course I was happy but I wondered how much these guys where getting? $125 for two guys on a Sunday emergency call? They where at my house about an hour. :-? :-?

Had they charged me the $300 I would not have been upset, I was expecting that.

Will I recommend them to friends? I can't, I don't remember who they are, I found them in the yellow pages.

aline
06-27-2008, 11:26 AM
I did a saturday emergency call by myself.
The homeowner said he lost power to a bedroom, bathroom and hallway.

I told him a minimum $250 service call fee would be charged and he said ok.

The problem was a tripped GFCI. He said the kids were in the bathroom when it happened and he thinks one of them probably pushed the test button. The homeowner had replaced the receptacle with a GFCI receptacle and when he did he connected everything downstream to the load side of the GFCI.

I reset the GFCI and rewired it so that the other loads were on the line side.
Did I lower my price? No way.

The funny thing is I had done a service upgrade on this home about a year prior to this. At that time I offered to install a GFCI in this bathroom while doing the service upgrade at a very reasonable cost. The homeowner declined and said he would do it himself.

growler
06-27-2008, 11:54 AM
Electricians aren't the only ones not charging enough.
Even some HVAC companies don't know what they should be charging.
$69 labor for a service call?

I have friends that do HVAC and it's a little different than electrical work.
When we do a service call it's normally all the money we are going to get out of that customer unless something else goes wrong in the near future. We can hope for a service upgrade but most homes wired 20 years ago with a 200 amp. service are still in good shape.

HVAC units really need to be serviced as much as twice a year ( spring,A/C, fall-heating). This is good because it keep them circulating through the neighborhood. What they are really looking for are the old units that need to be changed out. This is where they make the real money.

Their service calls can be seen more as paid sales calls. They just want to keep their name in front of you waiting to sell a new unit ( plus all the duct work you are probably going to need ). This works well for them.

You may see an electrical service that's 50 years old and still working fine but HVAC doesn't last that long. They can be sure of a new system a least every 20 years on average. If we got to do that many service changes we would be in hog heaven.

We electricians just don't have to many items with a $1500-$2000 mark-up right off before labor cost.

aline
06-27-2008, 01:12 PM
I have friends that do HVAC and it's a little different than electrical work.
When we do a service call it's normally all the money we are going to get out of that customer unless something else goes wrong in the near future. We can hope for a service upgrade but most homes wired 20 years ago with a 200 amp. service are still in good shape.

HVAC units really need to be serviced as much as twice a year ( spring,A/C, fall-heating). This is good because it keep them circulating through the neighborhood. What they are really looking for are the old units that need to be changed out. This is where they make the real money.

Their service calls can be seen more as paid sales calls. They just want to keep their name in front of you waiting to sell a new unit ( plus all the duct work you are probably going to need ). This works well for them.

You may see an electrical service that's 50 years old and still working fine but HVAC doesn't last that long. They can be sure of a new system a least every 20 years on average. If we got to do that many service changes we would be in hog heaven.

We electricians just don't have to many items with a $1500-$2000 mark-up right off before labor cost.
Why couldn't he have done this and still charged me $200 to $300?
Why do we think we have to charge a ridiculous low price just to keep our name in front of the customer in hopes of getting future work?
What's wrong with mailing a company newsletter or post card to the homeowner once in awhile to keep your name in front of them? Maybe quarterly, semi-annual or at least once a year. These can be mailed out during slow times to generate more work.

My A/C system is 12 years old. He didn't try to upsell me on anything. He didn't try to sell me a service agreement to service my A/C unit in the future or even try to set up an appointment to have it serviced again next year. He didn't even mention having it serviced at all. All he left behind was the invoice. No business card, no sticker on the furnace, no fridge magnet, no brochure on the importance of having it serviced each year, nothing at all.

If he's counting on $69 service calls to generate more work for himself he needs to do a better job of marketing and be sure I'll see his name everytime I change a filter. Instead I see the sticker from the guys who originally installed the unit.

When I mentioned they should make it easier to get to the condensing coils for cleaning since you're supposed to clean these every year he told me they don't need to be cleaned that often. He didn't seem too interested in coming out and servicing it each year. He seemed to just want to get in and out as quickly as possible so he could move on to the next one.

macmikeman
06-27-2008, 02:21 PM
http://i214.photobucket.com/albums/cc172/480sparky/elecfordummies.jpg



This is great! I posted it on E-Bay an hour ago for the low low price of $40.95 and sold 32 copies in one hour. The payments were all sent to my Nigerian bank account. My new plan is to retire at age 56 with tens of millions in the bank also.........

emahler
06-27-2008, 02:48 PM
You'll be receiving a C&D letter shortly. Or just pad the price 30% for me:D

480sparky
06-27-2008, 03:57 PM
This is great! I posted it on E-Bay an hour ago for the low low price of $40.95 and sold 32 copies in one hour. The payments were all sent to my Nigerian bank account. My new plan is to retire at age 56 with tens of millions in the bank also.........

When do I get my 15%? ;)

peter d
06-27-2008, 04:05 PM
I still laugh at that "EC for Dummies" creation every time I see it. The "cadpoint to English" thing really puts it over the top. Definitely one of your best efforts Ken. :D

growler
06-27-2008, 04:18 PM
My A/C system is 12 years old. He didn't try to upsell me on anything. He didn't try to sell me a service agreement to service my A/C unit in the future or even try to set up an appointment to have it serviced again next year. He didn't even mention having it serviced at all. All he left behind was the invoice. No business card, no sticker on the furnace, no fridge magnet, no brochure on the importance of having it serviced each year, nothing at all.


Maybe he's just an idiot I here there is a lot of that going around. Just kidding he probably hasn't had the proper training. He really should have tried to set you up with a service agreement.

New construction is not going any better for HVAC than for electrical so he may have come from that side of the business. Those guys don't know much.

tonyou812
06-27-2008, 11:41 PM
I recently got hooked up with a central air company .And I am trying to figure out the best way to charge them. They are mostly updating old systems so the jobs are small for me an example is yesterday I went to a job and brought stuff up to code add a switch and receipt in attic,add a WP gfi outside also I added a 240 v circuit and switch for new blower old was 110 .We were in and out in 2.5 hours I feel like I work fast there for T&M I am working myself out of money.Opinions pls
T & M is good sometimes but youll never get rich on it. Dont forget to include the time to get to the job. other wise you loosing money before you even start working.

nafis
06-28-2008, 12:35 AM
what do you guys think on this then......

http://www.thecircuitdetective.com

mivey
06-28-2008, 12:44 AM
what do you guys think on this then......

http://www.thecircuitdetective.com
I haven't read the material but I think it is a neat idea as long as the information is good.

I do wonder about the DIY that will get in over their head but they would probably do that even without this guy's information. You just can't protect people from themselves.

frizbeedog
06-28-2008, 12:52 AM
And bob, when multiple sources can be cited, it ceases being opinion.

When multiple sources can be cited, it just means that you found the right people who agree with your way of thinking.

...ever wonder why people never cite things (opinions) contrary to their way of thinking?

...to much vested in their belief system to do so.

Many will find, and be able to cite opinons that are contrary to yours. Does it then become fact?

It just means that there are more people with the same opinon, contrary to yours. It doesn't magically become fact.

...define fact! :)

Wait, I got it, opinoin is fact. :roll:

mivey
06-28-2008, 12:59 AM
When multiple sources can be cited, it just means that you found the right people who agree with your way of thinking.

...ever wonder why people never cite things (opinions) contrary to their way of thinking?

...to much vested in their belief system to do so.

Many will find, and be able to cite opinons that are contrary to yours. Does it then become fact?

It just means that there are more people with the same opinon, contrary to yours. It doesn't magically become fact.

...define fact! :)

Wait, I got it, opinoin is fact. :roll:Now that's a fact.

And, the majority is not always right. There's another fact for you.

LarryFine
06-28-2008, 01:34 AM
Hmm. A new signature: Not always right, but never in doubt.

emahler
06-28-2008, 07:16 AM
Frisbee and mivey. The differnce between fact and opinion is simple.

Frank Blau set forth a challenge years ago. He challenged anyone to show him a profitable P&L for a company who runs resi service T&M. After all these years he still hasn't been sent one. And the money offered is pretty decent.

Once you tip the scales to over 51% in any direction, that becomes the rule.

Right now, for resi/lt commercial service company (companies that focus on that market, not.dabble in it) There most definitely is a better way to do it.

Now you can sit there and argue against the known. That's fine. But at the end of the day , for companies with employees, who focus on resi/lt comm service and repair, its well established that a flat rate system is more profitable and usually provides the employees with higher pay, better benefits and and overall better life.

You want to argue for the alternative, have at it. You want to cite exceptions to the rule as proof, that's your right.

In the meantime go to websters and look up the difference between fact and opinion. You might learn something.

iwire
06-28-2008, 07:21 AM
Frank Blau set forth a challenge years ago. He challenged anyone to show him a profitable P&L for a company who runs resi service T&M. After all these years he still hasn't been sent one. And the money offered is pretty decent.

Well obviously all 60,000 something ECs knows about that offer and takes it seriously.

I guess your right it must be a fact. :wink:

emahler
06-28-2008, 07:25 AM
Well obviously all 60,000 something ECs knows about that offer and takes it seriously.

I guess your right it must be a fact. :wink:

You know what bob? You are right. Now, if you were in the resi/lt commercial segment of our industry. You might understand how right you are.

iwire
06-28-2008, 07:31 AM
You know what bob? You are right. Now, if you were in the resi/lt commercial segment of our industry. You might understand how right you are.

Don't get all upset someone does not agree with every point you make.

Have I ever pretended to have actually run a business?

Have I ever said I have the ability to run a business?

I have said you have a lot of great information. I have even gone to you for advice and you gave it to me.

I just don't see that offer as proof of anything, I do see it as a great 'talking point' for a presenter.

No more, no less, lighten up. :smile:

emahler
06-28-2008, 07:45 AM
Don't get all upset someone does not agree with every point you make.

Have I ever pretended to have actually run a business?

Have I ever said I have the ability to run a business?

I have said you have a lot of great information. I have even gone to you for advice and you gave it to me.

I just don't see that offer as proof of anything, I do see it as a great 'talking point' for a presenter.

No more, no less, lighten up. :smile:

you took that wrong...you are correct that most EC's have never heard of Frank Blau, let alone his challenge. You would think that every contractor who focuses on the resi/lt commercial service sector would at least know his name. It's not a secret. But the fact that so few EC's know his name is the reality. It's not a good reality, but it's the reality. If you were in this market segment, you realize how right you are about the lack of information in our industry.

iwire
06-28-2008, 07:54 AM
you took that wrong...you are correct that most EC's have never heard of Frank Blau,

Well then I apologize, I assumed you were busting my chops. http://forums.mikeholt.com/images/icons/icon11.gif

You certainly got me to change my view on the flat rate deal at least as far as homes.

Some honest questions, and not ones to discredit the flat rate method.

How many times do job costs exceed the quote?

What do you do, do you raise the rate for that task or do you sometimes just eat it for the one particularly hard install?

Are you providing all quotes (or any) site unseen?

emahler
06-28-2008, 08:03 AM
Well then I apologize, I assumed you were busting my chops. http://forums.mikeholt.com/images/icons/icon11.gif

You certainly got me to change my view on the flat rate deal at least as far as homes.

Some honest questions, and not ones to discredit the flat rate method.

How many times do job costs exceed the quote?

What do you do, do you raise the rate for that task or do you sometimes just eat it for the one particularly hard install?

Are you providing all quotes (or any) site unseen?

exceed quote? - occasionally this happens. majority of time, it's for unforseen issues (which is covered in the contract)

raise the rate? - you don't raise the rate, however, when you run into an unforseen issue, you show the homeowner, go over your options, and decide on a course of action. Many times that does mean additional costs. Where this differs from T&M is that you don't just trudge along and then give the homeowner a bigger invoice. Sometimes you do just suck it up. Especially if you are honest, and you realize you missed something that you shouldn't have missed.

quotes sight unseen?- never. that would be silly and useless. flat rate contracting is not just about pricing. it's an entire way to operate the business. but you will never find a successful flat rate company that gives prices over the phone.

iwire
06-28-2008, 08:08 AM
quotes sight unseen?- never. that would be silly and useless. flat rate contracting is not just about pricing. it's an entire way to operate the business. but you will never find a successful flat rate company that gives prices over the phone.

Well then I have been misunderstanding you for a while.

I thought that was part of the deal for simple jobs.

emahler
06-28-2008, 08:14 AM
Well then I have been misunderstanding you for a while.

I thought that was part of the deal for simple jobs.

nah...the whole premise behind flat rate is this...

get in front of the right customers, sell your knowledge and experience (not your time) to help them get what they want and need to make their lives better

iwire
06-28-2008, 08:17 AM
get in front of the right customers, sell your knowledge and experience (not your time) to help them get what they want and need to make their lives better

There is a lot in that sentence. 8-)

emahler
06-28-2008, 08:24 AM
There is a lot in that sentence. 8-)

yep...but guys will still deny it:D

iwire
06-28-2008, 08:28 AM
I have to be honest, I don't think I would be a good flat rate tech, now or when I was younger. I am just not a salesman / people person.

How hard is it finding a good electrician that can sell?

We have a hard time just finding good electricians.

emahler
06-28-2008, 08:50 AM
I have to be honest, I don't think I would be a good flat rate tech, now or when I was younger. I am just not a salesman / people person.

How hard is it finding a good electrician that can sell?

We have a hard time just finding good electricians.

it's hard...one of the reasons we decided to get out of it...not impossible though. it does take the right temperment. one of the main reasons is that as an industry, we shy away from it. Plumbers and HVAC are all over it. Our industry looks down on it.

but the truth is, you really don't have to sell...the better you are at selling, the better you'll do...but having the knowledge to make the right suggestions is more important. Give the customers the power to make the informed decision.

you can make a real good living just being honest with the customers and not screwing them.

iwire
06-28-2008, 09:06 AM
Our industry looks down on it.

It seems that to some any up selling is wrong, I think some can really be a benefit to both the EC and the HO.

As a customer I hate a pressured up sell, but I will listen to a suggestion, if I am interested I will ask for more info.

you can make a real good living just being honest with the customers and not screwing them.

I have never felt flat rate and up selling has to screw anyone. :smile:

sparky 134
06-28-2008, 09:49 AM
I've been in the industry since November 1996. Worked for my brother for about 9 years until his business folded. He went from a 4 man non union shop not including himself to a 50+ union shop. I thought he had the world by the *alls.

At this time the market was exploding. Blueprints were arriving daily with instructions to just do the work, we can't find anyone else. This lasted a while and then the market slowed, he scaled back.

During this time he moved into a bigger rental space. The rent was 7k/month. Along the way he had some bad employees, less than efficient superintendants, bad customers.

The business started having cash flow problems. He personally guaranteed loans to the bank to try and keep the business going. When his largest debtor declated Chapter 11 the bank shut down the business, auctioned off the assets and my brother was left owing the bank over 100K.

I knew none of this until the end. I was there watching people dismantle the shelving, buying all of the equipment, etc. Heartbreaking. He had worked so long and so hard to build his business.

Since he had been with the same bank since the beginning the bank worked with him regarding the loan paybacks. The bank could have taken the house, cars, etc. but because my brother was up front the whole time they didn't.

After he closed I went to work for someone else for about 8 months and decided to go out on my own. My wife and I just had our first child. I didn't know anything about running a business, let alone any customers. Sounds like the perfect way to start a business !

It's been over four years now. I've learned a lot along the way. I've worked some LONG hours, made mistakes, etc. but I try and learn from the mistakes.

I hired my first employee about 7 months ago. I'm tired of trying to do everything myself. I'd like to find another employee but the responses I've gotten have been mostly comical. My wife has started working in the office part time to help with the paperwork. The business has gotten to a point that I can't cover everything. I've dropped the ball too much lately because I have too much to do.

I'd like to build the business iand become one of the largest EC's in the area. This will not happen unless I go union. That's just the way the market is around here. Not saying anything negative about unions so no need to lock the tread or delete this post. One day I hope to be big enough to tackle the large electrical projects.

In the beginning I though working T&M was the only safe way to operate. No way I could lose money. Took me a little while to realize flat rate was the better way IMO to operate. No surprises for the customer or myself. Yes, I blew the number on many jobs but I learned. I had customers say, "How much do you charge per hour ?" Unless you are in the construction industry telling someone, "I charge $85/hr.) did not sit well with the customer. I just say, "We charge by the project. This way you know up front how much you will be paying."

I've had customers say, "I will only pay by the hour." I say, "Ok, if you can't find anyone please do not hesitate to call me back."

I've ignored my retirement investments for the past 4 years. The company profits I've left in the company to keep the company running. I do make a profit each year and I could take the money but I invest the money in the company. Soon I will start contributing to my retirement again. I'm 37 and sometimes I feel that I am aging like a dog does. I'm taking on bigger projects. Never got into track homes in subdivisions (thank God) because that market collapsed leaving many EC's looking for work. I'm pursuing more industrial/commercial customers.

Anyway, if you are still reading to this point you really should get a hobby ! j/k. I've learned a lot from reading the posts on this website. I realize people have different ideas as to how a business should operate. Some will succed, some fail.

It's Saturday and I'm on my way to the office to estimate some prints from a perspective new customer. Wish me well.

MagnoliaElec
06-28-2008, 10:15 AM
Gentleman I can't help but wonder if a combination of the two, flat rate and T&M can't be integrated into a single resilt commercial service company. I wonder because in my neck of the woods there has been some serious growth in the last 10-15 years with some major backwoods stagnation prior to that. I border on the metro area of Charlotte NC and the DIY rural/mill town areas. Anything built in the last 10 years roughly I can count on to be relatively code compliant. However anything prior to that just couldn't have been inspected. Two weeks ago I had a family send me an home buyer inspection report on an early 80s. There were some of the usual things no grounding open J boxes that sort of thing. The HOs also wanted some cans and fans, some three ways. During the course of doing their work we came across a myriad of Handy man buried splices(8), several switches without boxes just notched stud and some drywall screws, and my favorite a two gang box that had been half covered with drywall and had a 1G plate installed. Repair work, handy man homes, anything rural, homes from the 90's outside of tract homes,old mill houses T&M. Most everything else I'm trying to bring under flat rate.

Sparky555
06-28-2008, 01:53 PM
I'm not the brightest bulb in the box when it comes to numbers, but I'll throw some out anyway to illustrate the problem with T&M in residential service. Just my opinion.

A 1 man residential service needs $200k/year in gross sales minimum.
It can invoice 1500 hours/year maximum.
Breakeven is $133/hour minimum.
With 20% profit it's at $166/hour minimum.
T&M can't be quoted at $166/hour.

The numbers change with larger shops, but the reduction in OH/hour is offset by the need for more advertising.

Dave

aline
06-29-2008, 04:26 PM
As a customer I hate a pressured up sell, but I will listen to a suggestion, if I am interested I will ask for more info.
Here's a link to an article about high pressure sales tactics.
http://www.contractingbusiness.com/25/GlobalSearch/Article/False/13623/

If the above link doesn't work you can scroll down and find the article here along with some other good articles.
http://www.hvacprofitboosters.com/Tips/tips.html

bradleyelectric
06-29-2008, 10:40 PM
I couldn't. I'm too busy flying.

He's refering to the fact he doesn't charge by the hour, therefore how long the job takes has no bearing on the price. He just makes sure the GFI's operate properly and they have some, the pool outlet is a twistlock and on a GFI, pump is bonded, bulbs in the basement and attic work and they may want outside outlets while he is hanging the new foyer fixture. The prices are out of a book, not T&M.

bradleyelectric
06-29-2008, 10:49 PM
Goat head. I mean, Go ahead! :grin:

i'm going to be using that 1 !!

bradleyelectric
06-29-2008, 10:51 PM
I apologize. My comment in #46 seems kind of mean and unnecessary.

As opposed to him calling me a simpleton.

bradleyelectric
06-29-2008, 11:19 PM
What's wrong with mailing a company newsletter or post card to the homeowner once in awhile to keep your name in front of them? Maybe quarterly, semi-annual or at least once a year. These can be mailed out during slow times to generate more work.

Just a note. All the marketing stuff I've been dealing with say to be in front of your customers once a month in some fashion.

1 of the things we have been doing is asking name number address and email address as soon as we answer the phone. Email newsletter is the plan. Patrick Kennedy does that. I'm going to treat them as a customer whether we did the job for them or not. They will become familiar with me anyway.

I've been told if your not in front of your customer for 3 months your forgotten. The posts on this thread don't remember who did work for them a week ago.

bradleyelectric
06-29-2008, 11:23 PM
He seemed to just want to get in and out as quickly as possible so he could move on to the next one.

Seems I was just reading in another thread if he did more than that he would have been trying to rip you off or milk the job.