Many think paying piece work, is dishonest, unfair, and a poor way to pay, and for sure piece work ignores, skill, and rewards production even at the cost of quality, many a union has won favor in industries that used piece work to push the worker to ever decreasing levels of pay, so it may depend on who you are trying to sell piece work to.
Flat rate pricing
- Thread starter IrishRugger
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Many think paying piece work, is dishonest, unfair, and a poor way to pay, and for sure piece work ignores, skill, and rewards production even at the cost of quality, many a union has won favor in industries that used piece work to push the worker to ever decreasing levels of pay, so it may depend on who you are trying to sell piece work to.
Rewire
Senior Member
- Location
- Lake of the Ozarks
your not really doing flat rate but following past bid data to formulate a new cost basis for a set bid.The main problem I see with following past performance to formulate cost for future projects is the inability to duplicate the conditions of the previous jobs in an exact enough manner to make it reliable enough to project future job performance.
Although this might lend itself well to smaller projects and individual tasks the variables that would present in larger projects would seem to be to diverse as to make this system limited.
LarryFine
Master Electrician Electric Contractor Richmond VA
- Location
- Henrico County, VA
- Occupation
- Electrical Contractor
Hear! Hear!
Hear! Hear!
Even as an employee, I'd take a flat (agreeable) price for a given job over an hourly wage any day.
I once offered to pay one guy a flat price to do a job, and he declined. That's a bad sign right there.
Hear! Hear!
Well said!
Even as an employee, I'd take a flat (agreeable) price for a given job over an hourly wage any day.
I once offered to pay one guy a flat price to do a job, and he declined. That's a bad sign right there.
LarryFine
Master Electrician Electric Contractor Richmond VA
- Location
- Henrico County, VA
- Occupation
- Electrical Contractor
If you pay a fair price for the job, and include proper operation and inspection as part of the requirements, I see no issue.
No matter how fast I try to work, the work quality does not suffer. If you say "Well, that's you.", then all generalities fail.
dbuckley
Senior Member
- Location
- Canterbury, New Zealand
Some years ago, I used to order network wiring for buildings. In this marketplace there was "flat rate" pricing.
This meant that I could look up what the cost per point was, and multiply it by the number of points, and thats the price I'd pay. So if it was ?17.56 per point, and I wanted 2400 points, the bill would be ?42,144. Thats what I call "flat rate" pricing.
Of course, for the services supplier, it meant the profit per job was variable, depending on all sorts of niggles, and what they found when they turned up at the jobsite. They required certain conditions were met, and certain stuff had been done by others.
And I doubt they would be happy with me ordering one network presentation from them!
This meant that I could look up what the cost per point was, and multiply it by the number of points, and thats the price I'd pay. So if it was ?17.56 per point, and I wanted 2400 points, the bill would be ?42,144. Thats what I call "flat rate" pricing.
Of course, for the services supplier, it meant the profit per job was variable, depending on all sorts of niggles, and what they found when they turned up at the jobsite. They required certain conditions were met, and certain stuff had been done by others.
And I doubt they would be happy with me ordering one network presentation from them!
Split Bolt
Senior Member
- Location
- Northern Virginia
So, is the general consensus here that "Flat Rate Pricing" means something different to everyone who uses FRP?
hardworkingstiff
Senior Member
- Location
- Wilmington, NC
I would think flat rate pricing would have a tendency to get you the more difficult jobs and lose the easier jobs. If you use flat rate pricing, you best have some good sales skills to land some of the easier jobs at the great price to make up for the more difficult jobs (at the same price, but not as great now).
So, is the general consensus here that "Flat Rate Pricing" means something different to everyone who uses FRP?
I noticed that!
None of the flat rate guys that work in our area, loose money on flat rate, just the opposite they make out well, on both large, and small jobs, most of them know how to step price, oe of the many methods they learn when they are in the service business.
hardworkingstiff
Senior Member
- Location
- Wilmington, NC
Don't think I'm knocking flat rate pricing, just pointing out one issue that someone that's not tried it needs to be aware of.
What do you mean by "step price" ?
For example when a flat rate guy gets a troubleshoot job, he step prices it to protect against any down side, guys that don't understand how to price flat rate jobs, will usually take a beating on troubleshoots and assume flat rate is not for them.
IrishRugger
Senior Member
So in a trouble shooting cenario how do you know what to flat rate price for actual trouble shooting?
Is it based on past trouble shooting or is there a concrete set price?
I'm just using flat rate pricing on add on's to existing systems how do I calculate for real trouble shooting?
I only ask this because in my experience I have spent anywhere from 15 min up to a day on trouble shooting depending of course on the situation.
Electric-Light
Senior Member
Rewire
Senior Member
- Location
- Lake of the Ozarks
What I have yet to hear anyone mention when discussing FRP is the cost book.
The cost book, is only a small piece of the method, just having a cost book is useless, unless you understand how to apply all the information, and no one in their right mind is going to share the methods and information, they either spent years learning, of paid good money to learn, and give it away, it appears there a lot of guys that are looking for a system that can make them money, but like many customers will just not invest the money.
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ishium 80439
Senior Member
Satcom you seem to have a good handle on this and I am curious as to how the whole system works. I'm not asking for a tutorial necessarily but just an idea/ example of how this works.
If Mrs. Jones calls and wants a light in the bedroom and there is no existing electrical how do you start? Is there a set price for cut in single pole switch, light box and fixture install and than you add those numbers together? And than are there multipliers or some such device to add for plaster, insulation, access above versus no access?
And then it seems that the heart of this system is not necessarily the light install but the opportunity to tell Mrs. Jones that she needs GFCI's in her baths and dimmers would be a great idea and you need to look at the panel to make sure everything is safe.
Am I in the ball park with any of this? From what I can glean from what I've read the above is my best guess into this method.
And FWIW I'm not against this system necessarily but I have seen too many instances of abuse to make me entirely comfortable with the whole framework of stressing the upsell above all elst. The most obvious case that springs to mind is a job I did about 5 years ago. The HO was a single mom that had an issue with some wiring in the basement. She first called out one of the major franchises to look at the work. Long story short they told her that her panel had signs of arcing on the bus in addition to some other safety concerns and that she needed a service change. She didn't like the price and called someone else (me) in to evaluate the situation. As a rule I don't like throwing other ECs under the bus and I really tried to find something wrong with the panel, breakers, bus etc. Aside from being about 20 years old and some sloppy work there was nothing wrong with it at all. It makes me wonder how many people are sold things that they are scared into buying when it wasn't necessary and I really feel that the car salesman approach of "produce numbers or your out" encourages that.
If Mrs. Jones calls and wants a light in the bedroom and there is no existing electrical how do you start? Is there a set price for cut in single pole switch, light box and fixture install and than you add those numbers together? And than are there multipliers or some such device to add for plaster, insulation, access above versus no access?
And then it seems that the heart of this system is not necessarily the light install but the opportunity to tell Mrs. Jones that she needs GFCI's in her baths and dimmers would be a great idea and you need to look at the panel to make sure everything is safe.
Am I in the ball park with any of this? From what I can glean from what I've read the above is my best guess into this method.
And FWIW I'm not against this system necessarily but I have seen too many instances of abuse to make me entirely comfortable with the whole framework of stressing the upsell above all elst. The most obvious case that springs to mind is a job I did about 5 years ago. The HO was a single mom that had an issue with some wiring in the basement. She first called out one of the major franchises to look at the work. Long story short they told her that her panel had signs of arcing on the bus in addition to some other safety concerns and that she needed a service change. She didn't like the price and called someone else (me) in to evaluate the situation. As a rule I don't like throwing other ECs under the bus and I really tried to find something wrong with the panel, breakers, bus etc. Aside from being about 20 years old and some sloppy work there was nothing wrong with it at all. It makes me wonder how many people are sold things that they are scared into buying when it wasn't necessary and I really feel that the car salesman approach of "produce numbers or your out" encourages that.
bauler
Member
- Location
- Juniper Hills, CA
Has anyone used Key Profit Solutions flat rate software. Looks like a good deal at $500. You can get a PDF book for $75 which can be applied toward the software purchase. Always suspicious of something that is so much less than other like products. Here's the link:
http://www.kps-network.com/
http://www.kps-network.com/
Everyone has to get the idea out of their mind, that there is a book that prices a job, the book is only a guide to additional data, for developing a price, as far as misuse of any pricing, it is common in todays markets, there are plenty of good companies offering flat rate pricing, and in some states, you are required by law to give the consumer a total price for the work (A FLAT RATE) you can not charge crime and material, or any other unknown, in my area the flat rate companies have pretty much captured the service market, they eat the lunch of most of the low priced, so called low overhead guys.
MarkyMarkNC
Senior Member
- Location
- Raleigh NC
I've noticed this too. I don't know how many times I've gone to price a hot tub or cook-top install, and one of the national chains has been there previously and told the homeowner they need to upgrade to a 400A service as well. They don't take the time to do a load calculation, they just try to up-sell the (almost always) completely unnecessary upgrade.
LarryFine
Master Electrician Electric Contractor Richmond VA
- Location
- Henrico County, VA
- Occupation
- Electrical Contractor
You can't, really. For most troubleshooting calls, I quote my hourly. I'll either find and fix the problem, or find it and quote the repair charge.
If they want a cap, I'll agree to a stop-looking-if-I-haven't-found-it-by-then charge, where we agree on the time and how much it will cost.
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