Ethics of sharing competing supply house prices with each other

[George Stolz]

Two different supply houses have asked me to hand them a bill of materials from the other, to "smack their factory rep with" to get better prices.

Is it really ethical to share Supply House A's numbers with B? Seems kind of wrong, somehow.

 

[hardworkingstiff]

I will share a number verbally. I will only do this after buying the material from the lowest original bidder.

 

[B4T]

Sounds like a bad idea. Much better to put a materials list together and let them bid it out.

Then you can use the best price per item and nobody can talk bad about.. behind your back, of course :grin:

 

[480sparky]

The price they get from their rep is between them. None of my business. If I can get a better deal at supply house A, then supply house B can 'slap their own rep' themselves.

I ain't getting involved.


Do you ask your builders, "Hey, can you show me the bids of the EC's I'm up against when I bid your jobs?"

 

[cadpoint]

I would have asked for thier skeu numbers for there price lists!

 

[480sparky]

I would have asked for thier skeu numbers for there price lists!

SKU, not skeu. Stock Keeping Unit.

 

[PetrosA]

I don't know that I'd leave them any kind of printed material, but... Let's say that supply house A is 1/2 mile from your shop, while supply house B is 15 miles away. SH B is almost 50% cheaper for your preferred brand of recessed lighting than SH A but you primarily use SH A because of location (this happened to me recently). Would you be willing in that case to talk to someone at SH A about their pricing, at least to bring it to their attention?

You wouldn't think that pricing can be that radically different from one SH to another, but I've seen double or more on various occasions ex. $15 vs. $33 for the same single pole ITE/Siemens bolt down. That's ridiculous whether it's the fault of the rep or the guy setting the margin.

 

[benaround]

Two different supply houses have asked me to hand them a bill of materials from the other, to "smack their factory rep with" to get better prices.

Is it really ethical to share Supply House A's numbers with B? Seems kind of wrong, somehow.

I agree, let them do their own dirty work.

 

[jrannis]

I let them know if I think I am in the wrong discount column. You can usually see the percentage difference in the numbers.

 

[SEO]

The price they get from their rep is between them. None of my business. If I can get a better deal at supply house A, then supply house B can 'slap their own rep' themselves.

I ain't getting involved.


Do you ask your builders, "Hey, can you show me the bids of the EC's I'm up against when I bid your jobs?"

All very good points 480sparky I agree.

 

[charlietuna]

Suppliers and reps are sooo crooked any price list would really mean nothing! "There is no honor amoung thieves" ! I never realized how many ways people could find to screw their customers until i saw how suppliers operate.

 

[petersonra]

This is a game supply houses play. The thing is, it is not a game being played against other supply houses. it is a game they are playing on you. they want you to think that getting the best deals is some super secret thing. Its not.

Electrical supply houses have different prices for just about everyone. I have seen them charge everything from 15% of list all the way up to list price for the same item to different customers. I have had projects where two different P.O.s with the same part on it got charged two different prices.

I don't see anything wrong with some hints but don't let them use you.

If you have enough volume to make it worthwhile, sit down with your salesman and ask him what it will take to get their best prices on everything you need as a whole, over a long period of time. They can be surprisingly honest about that. Don't be surprised if you pay a little extra for some items to get the best overall prices. And don't be surprised if you can get some stuff cheaper at one of the big box places.

Even if you have good pricing you can sometimes get better pricing for specific projects just by telling the guy that you can't get the project without better prices. Manufacturers are often willing to listen to such entreaties, if the size of the project is worth it. In many cases, it does not have to be a super huge project to make it worthwhile to ask.

 

[petersonra]

Suppliers and reps are sooo crooked any price list would really mean nothing! "There is no honor amoung thieves" ! I never realized how many ways people could find to screw their customers until i saw how suppliers operate.

Its more like how many ways customers find to screw themselves. Its amazing how many customers will pay 25-50% extra for electrical supplies to get "free" coffee and donuts at the supply house.

 

[dduffee260]

Suppliers and reps are sooo crooked any price list would really mean nothing! "There is no honor amoung thieves" ! I never realized how many ways people could find to screw their customers until i saw how suppliers operate.

Ditto on that Charlie. You have to watch vendors and insurance companies very closely. If you purchase over $300,000 a year in electrical materials from supply houses it is almost worth the expense to have a person go over the invoices and quotes to see where you were overhcarged. At least a part time person for sure.

Our largest problems no doubt are lighting and switchgear quotes. They may quote the stuff on bid day at say $87,000 but when you add all the total invoices up at the completion of the project they can be from $87,000 to $100,000 or more. Trick is you have to find where you were overcharged because of the way the project was billed out. One way is to keep a running tally on what has been invoiced and when it hits the quote amount flag it. Then basically every charge that comes in after that flag amount was hit is an overcharge. It is best to find it sooner than later.

I don't show any supply houses the other ones numbers. Other contactors do it for them I guess because they usually know where they were the next day. One trick they play is to " forget" to put fuses in disconnects, include lamps and other things. This way they look lower at first but when you build the job when you add in the fuses or lamps they are higher.

We use several supply houses. I an friendly to all of them but not friends with any of them. All I want is good materials at a fair price.

 

[ohm]

Its more like how many ways customers find to screw themselves. Its amazing how many customers will pay 25-50% extra for electrical supplies to get "free" coffee and donuts at the supply house.

True. And the individual foremen or trucks are mostly to blame.

We noticed trucks driving 20 miles and buying "token" items throughout the day to be near their best restaurant for lunch and coffee breaks.

PS they are no longer with us.

 

[active1]

I seen that happen a long time ago at a place I worked. The EC had a salesman come from a different supplier. They told the EC how they wanted their business and can get them much better prices. The supplier asked to only look at the other suppliers invoices. They wanted to look at a few I guess to price out different items. While the salesman did not take or write down the numbers, he called into the office with the items and amounts. Soon after we had a new account set up. The prices were exactly the same or a few pennies below.

IMO what happened is the new supplier wanted to see how much the EC was paying so they could match it, or be just lower. It would have been much better to let the suppliers keep guessing how much they should charge. Suppliers have no reason to ask for this information except to see how much your willing to pay.

Of course if you wanted to play the game - scan some incoices, cut & past new prices (maybe 15% less), the fax it to the other supplier, tell em you want cheaper.

 

[DAWGS]

My suppliers will generally keep up with my bids and ask me about the jobs. If they didnt win the job I will tell them they were a certain percentage off. I dont give them exact numbers. They seem to appreciate it.

 

[charlietuna]

Suppliers and reps are in bed with each other on many jobs-i have caught them fixing prices many times--just got down to which one worked the best with me, and i favored him, but the word "TRUST" never entered my mind. I once had them change a price on Square D equipment from $63,500. to $3,600. in a blink of an eye! It is the contractor's job to keep them honest--like we have time for that??? And when i catch them, just go elsewhere for a few months(even though it cost me money)--they get the picture after a while. Now i have always worked "with" my suppliers on trade problems and material problems, but it made little difference in our relationship.

 

[hardworkingstiff]

Think about how you want the GC to treat you after a bid. I would like to know what the low bid was. It's the same with the supply houses. They want to know how much they were higher than the low bid.

 

[C3PO]

Two different supply houses have asked me to hand them a bill of materials from the other, to "smack their factory rep with" to get better prices.

Is it really ethical to share Supply House A's numbers with B? Seems kind of wrong, somehow.

Is it ethical? Not really, but it happens each and every day. Not just in our industry but in everything, that is what makes the world go round. It all is about who you know and how much money you have.