Transition from residential to commercial electrical

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ActionDave

Chief Moderator
Staff member
Location
Durango, CO, 10 h 20 min from the winged horses.
Occupation
Licensed Electrician
These are reasons I no longer want to work for homeowners:

They want work done super cheap.
They want work done at odd hours including really early, really late, or on the weekends.
The jobs tend to be small and require lots of driving.
They want superb quality and cut throat prices.
They bitch and complain about petty things like my guys leaving a wire nut or some minute trash on the job site.
When I charge them a fixed fee for a service and my guys finish it quickly, they ask for a discount instead of saying "thanks for getting that done quickly".
I hate having to walk on egg shells when in expensive homes making sure we don't scratch, damage, or otherwise disturb their pristine residence.
They treat me like a second class citizen. They don't know my background (EE) and so think I'm just some day laborer (aka burger flipper).

Note: the above represents about 10% of my customers. The other 90% are great. I'm just tired of dealing with that 10%. And if that 10% is still going to exist in the commercial electrical world, well then I'm getting out of electrical contracting all together.

But if it doesn't, then I want commercial maintenance accounts (checking emergency lights, etc.). I also want commercial accounts for lighting and other general electrical upgrades (motors, panels, etc.). How do I get those accounts?
That is the great thing about commercial, nobody cares about how much something costs they are just waiting to pay whatever it takes. None of them complain about how much it costs when they call you sometime in the evening and it turns out the fix is something simple like resetting a breaker. All they care abut is that the job is done right. Most of them have a guy on staff that has pockets full of cash that will meet you in the parking lot when you finish up with the job.

No worries about interrupting regular business hours....come on in and work, customers that have a problem with a lift in the aisle where they want to shop aren't important to us.

And the best part is when you tell the owner of the commercial property that what he has right now is a cascade of problems that started about thirty years ago he says, "I had no idea! Do whatever it takes to make this place right. When you are done I'll get my guy to meet you in the parking lot.
 

mtfallsmikey

Senior Member
I am a building engineer, really don't need an electrician except for the big stuff, but we don't pay in cash in the parking lot.... Yes, work will need to be done at off times/hours, yes you will need to have a good commercial liability policy (will want a copy of your COI before anything is signed, or set up as a vendor), yes I will expect the work to be done in a professional manner, and quickly. Also, look into doing arc flash studies, IR scanning, fire alarm systems, sometimes hard to find a smaller contractor to do all of that. My main electrical contractor is even getting into fire sprinkler fitting as well.
 

cowboyjwc

Moderator
Staff member
Location
Simi Valley, CA
90% of what you mentioned above will be on EVERY commercial job, especially the cost/payment. Also keep in mind that you may no be paid for 30-60 days on commercial jobs.
Exactly what I was going to say. Many bigger companies have lawyers on staff, so it doesn't cost them anything extra to get involved in a lawsuit.
 

readydave8

re member
Location
Clarkesville, Georgia
Occupation
electrician
That is the great thing about commercial, nobody cares about how much something costs they are just waiting to pay whatever it takes. None of them complain about how much it costs when they call you sometime in the evening and it turns out the fix is something simple like resetting a breaker. All they care abut is that the job is done right. Most of them have a guy on staff that has pockets full of cash that will meet you in the parking lot when you finish up with the job.

No worries about interrupting regular business hours....come on in and work, customers that have a problem with a lift in the aisle where they want to shop aren't important to us.

And the best part is when you tell the owner of the commercial property that what he has right now is a cascade of problems that started about thirty years ago he says, "I had no idea! Do whatever it takes to make this place right. When you are done I'll get my guy to meet you in the parking lot.
You forgot to mention the free coffee and donuts
 
I thought about this question for awhile at work today. I could write you a book, but i'm not going to do that.

First, let me just say, that all of those complaints you have about residential customers will be multiplied in commercial. We've all been there brother; I know from the outside looking in it seems like a cakewalk, but coming with that attitude will drown you. Your expectations will be rudely met with the reality that all work is hard.


Anyway, I'm going to leave you with this quote from Mike Rowe.



Find your niche, and get damn good at it.

That's what I'm trying to do, find my niche. I know my niche is not residential. Thanks for the words of advice.
 
These are reasons I no longer want to work for homeowners:

They want work done super cheap.
They want work done at odd hours including really early, really late, or on the weekends.
The jobs tend to be small and require lots of driving.
They want superb quality and cut throat prices.
They bitch and complain about petty things like my guys leaving a wire nut or some minute trash on the job site.
When I charge them a fixed fee for a service and my guys finish it quickly, they ask for a discount instead of saying "thanks for getting that done quickly".
I hate having to walk on egg shells when in expensive homes making sure we don't scratch, damage, or otherwise disturb their pristine residence.
They treat me like a second class citizen. They don't know my background (EE) and so think I'm just some day laborer (aka burger flipper).

Note: the above represents about 10% of my customers. The other 90% are great. I'm just tired of dealing with that 10%. And if that 10% is still going to exist in the commercial electrical world, well then I'm getting out of electrical contracting all together.

But if it doesn't, then I want commercial maintenance accounts (checking emergency lights, etc.). I also want commercial accounts for lighting and other general electrical upgrades (motors, panels, etc.). How do I get those accounts?

Business owners are are so much worse.
 

readydave8

re member
Location
Clarkesville, Georgia
Occupation
electrician
Well its like anything else, 10% of anything is crap (in fact probably more than 10%).

So switching to commercial is not a miracle cure.

However there are differences, I liked commercial construction because I could spend more time on one job, less jumping around. I like commercial service work because it's often simpler to work in a public business place than in someone's home.

Although I doubt that I'm qualified to give advice, I would recommend a gradual phase-in.

As to how to find jobs, I have been pleasantly suprised with the little work I've done for work-flippers, they contract with stores and call electricians out of the phone book or internet search. If I follow their rules and can agree to a price, it seems to work, about 6 weeks to get a check tho.

Sunset Lighting, JWCEnterprises. Dollar stores, Murphy stations.
 

Fulthrotl

~Autocorrect is My Worst Enema.~
That kind of work doesn't interest me unless I'd be making a shit ton of money and could retire in 5 years.

i'm working seven days a week right now, doing industrial work.
i am a one man band. i'm 59 years old.

i'm working this saturday and sunday. with the exception of my
mother in laws birthday, where i'm hauling my smoker up to
her house in julian and smoking salmon for 25 people, i'm working each
day for the rest of this year, most likely.

i am very, very grateful for the work. i have excellent customers,
have excellent working relationships with them, and they treat me
very well.

it took five years to find those handful of customers. i've not bid against
any other EC's in three years. last month my billing was about $140k.
i worked my ass off. i need two more years of this, and i can retire, without
needing a pension or social security.

sounds pretty good so far, yes? to get here, i had to go thru 2008,
when my net taxable for the year, was $168 or so. that is not a typo.
there is NOT a comma in that number.

reading this thread, you seem to have all sorts of conditions about what
you are willing to do, and how you have 90% good customers. if that is
true, i'd suck it up, and continue with your business. you are in a segment
of the marketplace where it's almost day labor. you do small stuff, and get
paid on completion. this is why you have home depot parking lot wizards
competing with you.

would you like to fork over say, $80,000 in material, and then wait for 60 days
for a check, while paying your guys labor and benefits? yes? welcome to commercial.

would you like to drive out to bid over 36 jobs for a commercial account amounting to
$200k, while getting about $5k in work for your trouble? welcome to commercial.

the grass is always greener over the sceptic tank.
 

Genman

Member
Location
Mt. Vernon WA
Commercial Electrical work has some serious headaches too.... to get started you have to have bonding capacity and just starting out most contractors don't have the assets to be able to bond very big jobs. So with that being said you have to bid to GC's and they will be pretty cut throat... the best thing to do is to get in with a few GC's so that they call you for numbers on projects. But you better be sure and read EVERYTHING in the bid spec. You will quickly realize where your weak spots are.... resi electrical is pretty straight forward... Commercial and Industrial gets bigger and more complicated.... once you have to build about 10 3 inch submittal books you will see why those other companies have all the people in the office. The bigger the job the more narrow the profit.... I bid a davis bacon job installing 7 generators not too long ago.... the top 7 bidders were within 2% of my winning bid... I noticed a bid the other day for a new school... the two contractors were 10K apart on a 25M job.... so just remember this.... when you start bidding public work... you don't want to get every job... If you are your doing something wrong... Just start out being afraid.... very afraid...
 

kwired

Electron manager
Location
NE Nebraska
I have worked for commecial ECs for long time. Nights, weekends, snow storms, hoilday work have all been part of it.

I will be working about 9PM till 1AM tonight and tomorrow will be 2PM till about 3 or 4 AM.

That kind of work doesn't interest me unless I'd be making a shit ton of money and could retire in 5 years.
Big difference is those late night calls for a residential customer are often for an inconvenience, for commercial/industrial customers it is often going to be a loss of revenue at stake if the problem isn't solved quickly. The residential customer often doesn't appreciate the value of you coming in the middle of the night unless it is cold and the heat isn't working or something like that. The commercial/industrial customer can be risking losing more revenue in productivity then what you will charge him, so charge extra for off hours and they still don't care. Those that do - need reminded whether they needed your service at that hour or not, and are in the 10% category just like the residential customers you currently have.
 

iwire

Moderator
Staff member
Location
Massachusetts
That is a good point, the companies I worked for had higher night rates and pay the guys a decent differential for night time work.
 

cpinetree

Senior Member
Location
SW Florida
That is the great thing about commercial, nobody cares about how much something costs they are just waiting to pay whatever it takes. None of them complain about how much it costs when they call you sometime in the evening and it turns out the fix is something simple like resetting a breaker. All they care abut is that the job is done right. Most of them have a guy on staff that has pockets full of cash that will meet you in the parking lot when you finish up with the job.

No worries about interrupting regular business hours....come on in and work, customers that have a problem with a lift in the aisle where they want to shop aren't important to us.

And the best part is when you tell the owner of the commercial property that what he has right now is a cascade of problems that started about thirty years ago he says, "I had no idea! Do whatever it takes to make this place right. When you are done I'll get my guy to meet you in the parking lot.

This is why the internet needs a sarcasm font :lol::happyyes:
 

teco

Senior Member
Location
Mass north shore
What they said, plus this.

What they said, plus this.

IMO, commercial customers present more of a challenge than ever these days. Of course it depends on the type and size of the customers you are seeking. If you stay small commercial you may not encounter as much of what I deal with but it will definitely be more work and more difficult than dealing with a homeowner. My customers are very large corporations and below are some of the things we deal with on a regular basis,

Extensive acceptable vendor process, signing and abiding by company service agreements, provide open book bidding that is subject to audits, all workers attend a company's internal safety courses and this is not billable time, OSHA 10 hour course mandatory all workers, all workers required to take company internal security class, at least 5 and sometimes 10 million liability insurance required. All workers, managers, and installers, mandatory criminal background check and drug screening test, lots of required company meetings better include them in your bid, One million per accident workers comp coverage, Increased auto insurance coverage if vehicles will be used on property, all workers must read and follow company code of conduct policies, sign most favored customer clauses, all labor rates are agreed upon and set for minimum of three years, mark ups on certain material items subject to audit, waits up to 90 days for payments, dealing with extensive purchase order systems, creating invoices within a the company's own AP system, more and more are doing this now. I could go on and on. Of course we could always say no thanks and move on, but then we'd be missing out on the chance for lots of work. All of this and more has required us to hire a full time person to handle all the hours needed to keep up with what our customers require to do business with them. It is definitely very different than working for homeowners. I would make real sure you know what your getting into if you make the transition. PS, have enough of money behind you, it requires lots of cash flow to work for large commercial clients.
 
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