New Commerical Tactics

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mgookin

Senior Member
Location
Fort Myers, FL
If customer only wants to pay a certain amount for a product or service and someone is out there that will sell it for that amount, I don't see you have much choice other then to try to sell them the idea that your price has an overall better value then those others. If price alone is all that matters to them you will not make the sale.

And it might end up that instead of OP being first to call, maybe it will push him to 2nd or 3rd to call. Or maybe nobody else will cave in either...
 

Ingenieur

Senior Member
Location
Earth
the only way you are going to sell this (other than the safety priority) is if you can make the case that:
cost of hours to perform the work + travel x (1 man) + fixed cost < cost of hours to perform the work + travel x (2 men) + fixed cost

but you can't
travel time is dead time and reduces the advantage of 2 men on the job
and for much of the work 1 man can do it as quickly as 2
there may be a small advantage to 2 at times, but not over twice as fast to offset the dead travel time

8 hour day, 1 man
2 hours travel
6 work
1 vehicle cost
total 8 + vehicle

2 man
4 hours travel
10 work (assume a bit of an efficiency advantage)
1 vehicle cost
total 14 + vehicle (and 2 dead time hours)

unless you can get the 2 man crew to do the work in 2 hours (vs 6 for 1 man for a total of 4) there is nothing in it for the management company
and that ain't happening
plus you have the other 1/2 of the day to fill in

I think you need to look at it differently if you want the work
you want paid for having a 'body' there, not really doing much work, and the management company understands this
figure out a way to use that guy on other work while minimizing the hard costs
drop him off with supplies and have the truck continue to another job
have a service tool/supply truck that makes rounds to guys that were dropped off (who have no truck)

you made hay while the sun shined lol
they have changed the terms
as others have said, adapt or decline
 

__dan

Senior Member
No question there is a race to the bottom going on.

The property management companies have a game with metrics they are scored on. The metrics themselves could have no basis in reality, it happens, it's a game they play, but what matters is achieving some target on paper someone higher up has set for them.

The only way to proceed would be to try to get the inside information and insight, what metric target are they trying to hit so they can report success on paper to the clueless game players higher up.

Are they trying to reduce total hourly rate, total annual category spending, repeated callbacks to fix the same thing over and over again, energy consumption, material and capital expense ...

If you can discover what metric they are trying to report an improvement in, it becomes a game of reducing that and increasing the metric they are not tracking and reporting to their higher ups ... don't change the burnt out contactor you found, just keep hitting the reset button and tapping on it to reduce the expense of the single call but increase overall call volume ...

Not that I would do that but the successful competitor certainly will ...

Let's say they want to reduce maintenance cost because that's what they want to report an improvement in, but the property management company actually makes more money supervising the larger project capital improvements because their markup is better there, the total number is bigger, but their expense is lower as they just herd their captive group of nice looking brown nosed vendors ... Even better if the improvement does not work and they can get paid to redo the work every two years. I know of a large building that was maintained (by the PM company) to the point it became no longer useful and sat vacant for ten years. Just drove by yesterday and there's a major capital project going on there.

So they would actually want to disinvest from maintenance and it's better if the large capital equipment just blows up as it becomes a surprise emergency spending request to the owners to replace their gensets, UPS, switchgear, ... PM company wins both ways, reporting a gain in their savings on the maintenance item and a gain in sales for the project management division ... seen that and reported it as fraud ...
 

brantmacga

Señor Member
Location
Georgia
Occupation
Former Child
We went through something similar a few years ago ......

Some of our service clients went to Facilities Management to handle their service. We just let them go.

You can't have the customer dictate what you will charge and expect to be profitable.

I tried to play along for a couple of months, but only to have FM call back after the work was done to try and negotiate the invoice. Nobody got time for that.



Sent from my iPhone using Tapatalk
 
Bottom line: If they found someone cheaper and they are happy with the results, then can you blame them? Seems like so many people get upset when someone charges them an above average fee, yet they expect to be able to charge others an above average fee without complaint....
 

hbiss

EC, Westchester, New York NEC: 2014
Location
Hawthorne, New York NEC: 2014
Occupation
EC
These guys are not management companies, they are called "Nationals" and are the scum of the earth. Every trade has a version of them. Often you get to deal with a sub of a sub, rarely the actual company that bills the customer. So there are lots of hands in the pot. You have to jump through hoops with their paperwork and procedures and it's normal to be strung along and not be paid. Then you have to go after the customer- if you can.

Suddenly in the last month or so I am seeing all these companies (5+ different management companies) no longer allow the billing of two men...

I find it interesting that all of them came up with that at the same time. Collusion? Likely they are all subs for the same company. That should tell you something.

So you are reluctant to give up 500K a year in work for these guys? How about when you figure you lose 100K working for them?

My advice is to do what I do- just hang up the phone as soon as they call. Nothing but bad news.

-Hal
 

kwired

Electron manager
Location
NE Nebraska
Go directly to owner and make them a better offer then they have now. But you will need to cover more then electrical. You will eliminate all the profits taken by all the middle men and may be doable, but now you have become a PM yourself, and probably will sub out some of the other work and be right in the middle of negotiating prices again.
 

__dan

Senior Member
Go directly to owner and make them a better offer then they have now. But you will need to cover more then electrical. You will eliminate all the profits taken by all the middle men and may be doable, but now you have become a PM yourself, and probably will sub out some of the other work and be right in the middle of negotiating prices again.

I wish, but sometimes there is no owner. It is some tier 1 publicly held corp with 300 properties nationwide and they choose to not have their own staff for maintenance or to oversee contractors and vendors. You would have to bid it yourself as the PM company against huge outfits. The best work but the employees are put into a horse race to the bottom.

One way in is sole source specialty trade services where you are the only vendor in that specialty service or have become locked in because they run on your hardware / software package. Automated digital building controls and very few others where the hardware and software is maintained as a very proprietary business model. You would want to bid against Automated Logic, Honeywell, JCI ...

Most any of the other trades and you become just like the guy who cuts the lawn or the girl who supplies the coffee products. There is a beauty contest and last years winner has no hope of securing this years business over all other comers.

Quality is just a buzzword in the promotional literature. One vendor supplies something that obviously will never work or be constant trouble over time. But it's not a problem because the PM company does not service or use it themselves, one of their other vendors does and suffers from it.

There are many horror stories of vendors who made large capital expense investment to gear up for large work only to loose the business next cycle, or contractors who bid low on phase one expecting to get phase two and three, only to see phase one two three done by three different contractors.

If the same spot in the parking lot around the primary transformers gets dug up every 3 - 4 years to fix what the last job did not do, the PM is billing markup on three different jobs instead of one. It really takes an appearance of a lot of work to get to the bottom.
 

growler

Senior Member
Location
Atlanta,GA
the only way you are going to sell this (other than the safety priority) is if you can make the case that:
cost of hours to perform the work + travel x (1 man) + fixed cost < cost of hours to perform the work + travel x (2 men) + fixed cost

but you can't
travel time is dead time and reduces the advantage of 2 men on the job
and for much of the work 1 man can do it as quickly as 2
there may be a small advantage to 2 at times, but not over twice as fast to offset the dead travel time

8 hour day, 1 man
2 hours travel
6 work
1 vehicle cost
total 8 + vehicle

2 man
4 hours travel
10 work (assume a bit of an efficiency advantage)
1 vehicle cost
total 14 + vehicle (and 2 dead time hours)

unless you can get the 2 man crew to do the work in 2 hours (vs 6 for 1 man for a total of 4) there is nothing in it for the management company
and that ain't happening
plus you have the other 1/2 of the day to fill in

I think you need to look at it differently if you want the work
you want paid for having a 'body' there, not really doing much work, and the management company understands this
figure out a way to use that guy on other work while minimizing the hard costs
drop him off with supplies and have the truck continue to another job
have a service tool/supply truck that makes rounds to guys that were dropped off (who have no truck)

you made hay while the sun shined lol
they have changed the terms
as others have said, adapt or decline


I can see that you have everything figured out on paper just fine but I can tell that you have never done many service calls.

The OP is talking about big box stores and there are some service calls where one man can handle the problem but there are plenty of calls where two men are needed. You make the assumption that on a service call you know what the problem is and what correction is needed in advance and can plan for everything. I have never found that to be the case.

You could send one man to the service call to determine what the problem is and correction needed and then send for another tech if needed but shouldn't there be a seperate travel charge for the second man.

The idea of dropping a man off at a store to work without transportation or supplies or equipment? You just have a work order and really have no idea what will be needed. If the tech that's dropped of is an apprentice/helper, he/she may not be qualified and this may be a dangerous situation.

So now all of the employees are working alone so what need is there for apprentices, only qualified electricians needed. How do you train apprentices? If ECs can't afford qualified electricians maybe the company can only send out electricians in training and let the customer pay while they learn.
 

Fulthrotl

~Autocorrect is My Worst Enema.~
The idea of dropping a man off at a store to work without transportation or supplies or equipment? You just have a work order and really have no idea what will be needed. If the tech that's dropped of is an apprentice/helper, he/she may not be qualified and this may be a dangerous situation.

So now all of the employees are working alone so what need is there for apprentices, only qualified electricians needed. How do you train apprentices? If ECs can't afford qualified electricians maybe the company can only send out electricians in training and let the customer pay while they learn.

well, unlicensed electricians (apprentices) working alone is not a new concept.
most places, it's illegal, so if someone gets hurt, there is that liability.

there is also the quality issue. one of the contractors i do lighting certifications
for, has gone from fairly competent, to a train wreck. why? he's got apprentices,
and entry level journeymen working alone. what should be a 90 minute certification
process sometimes now requires two visits. a second visit by me is a second charge.
the charge is the same as the original charge, 'cause it's a day of my life that i could
sell for the price of another certification.

i've had certifications end up costing three times the original planned expense.
see how well that works with the cheap labor plan.

second, working alone just doesn't work in some situations. ever work alone,
and have to go pee, and come back to missing tools? welcome to public spaces.
i walked about 70' away from a stack of papers, and a light meter to get a better
cell signal, and 90 seconds later, that light meter was ***gone***.

the light meter cost $2,200. so did the one i had to replace it with. wasn't a highly
profitable day, that one.
 

mgookin

Senior Member
Location
Fort Myers, FL
... and 90 seconds later, that light meter was ***gone***.

the light meter cost $2,200. so did the one i had to replace it with. wasn't a highly
profitable day, that one.

Ouch!
You do state certifications so you use calibrated meters? And you send them back in for calibration annually?
 

Fulthrotl

~Autocorrect is My Worst Enema.~
Ouch!
You do state certifications so you use calibrated meters? And you send them back in for calibration annually?

haven't had that problem yet. maybe if one of them lasts a year,
i can send it back in for a re cert.:rant:

calibrated meters are not mandated by the CEC.
my experience was that i've had two calibrated ExTech meters
next to each other, and the readings varied by 30%.

what i'm currently using is way overkill for my needs but....
it time stamps and geotags each reading, documenting when
i was there. there is a mandatory 10% audit of certifications
performed, and it will make a nice backup if i need to document.

it does full spectrographic analysis of the reading, including CRI.
ya know how specifications of lighting are 90% CRI, in places like
calif? and how manufacturers certify complinace?

lighting manufacturers lie.:happyyes:

here's what i use:

asensetek passport pro

http://www.asensetek.com/

it's a chinese product, so you'll have to deal with the presentation of the
equipment. but i've not seen anything better than this, unless you feel
the need to flush five or six thousand dollars down the drain.
 
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Ingenieur

Senior Member
Location
Earth
I can see that you have everything figured out on paper just fine but I can tell that you have never done many service calls.

The OP is talking about big box stores and there are some service calls where one man can handle the problem but there are plenty of calls where two men are needed. You make the assumption that on a service call you know what the problem is and what correction is needed in advance and can plan for everything. I have never found that to be the case.

You could send one man to the service call to determine what the problem is and correction needed and then send for another tech if needed but shouldn't there be a seperate travel charge for the second man.

The idea of dropping a man off at a store to work without transportation or supplies or equipment? You just have a work order and really have no idea what will be needed. If the tech that's dropped of is an apprentice/helper, he/she may not be qualified and this may be a dangerous situation.

So now all of the employees are working alone so what need is there for apprentices, only qualified electricians needed. How do you train apprentices? If ECs can't afford qualified electricians maybe the company can only send out electricians in training and let the customer pay while they learn.

I worked in AK for 10 years
service calls were 100 miles in light aircraft
no local stores
I was VP of operations for a national control company: Maine to Florida, NY to Cali, and all points in between

If you can't make it work with 1 man then the only option is to walk away
the stores are concerned with their profit margin, not yours
 

hbiss

EC, Westchester, New York NEC: 2014
Location
Hawthorne, New York NEC: 2014
Occupation
EC
... the stores are concerned with their profit margin, not yours.

No. The NATIONALS are concerned with their profit margin, not yours or any of the crooked subs that work for them. Believe me, with what the stores pay those Nationals a contractor working directly for them could live very comfortably.

Most Nationals have no problem stringing you along then changing the game hoping that you are too stupid to realize that now you won't make any money. Another tactic is that they will pay for awhile then give you excuses why they aren't paying while you rack up more work for them. You just did those jobs for nothing because the paychecks will never come. You can go after the stores- maybe.

We are a telecom/communications company and we have our own board like this one. We have a private forum that is basically a black list for Nationals. Get a call from one, look them up or ask if anybody has heard of them. Problem is they mutate like fungus, out of business then next day back under some different name. Easiest way to see if one is legit is to tell them right off that you require a credit card to be kept on file that will be charged each time before you do a job for them. Betcha they hang up faster than you.

-Hal
 
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Fulthrotl

~Autocorrect is My Worst Enema.~
You just did those jobs for nothing because the paychecks will never come.

it's funny... i've got one of those now.... after four months, and a few follow
up emails, i send one saying "when am i going to get a check in my hand?"

three days later, i get a reply by email, they will send a check the end of this
week... five minutes after that email, they send info on another job they want
me to do....

sure, wilbur.... the only reason you are still in my phone contact list, is if that
check ever does show up, i can then move you to the blocked list.

that other job? yeah, i'll do it, but i show up, do the cert, collect a check
on the spot, and after that check clears, i'll fedex you the certification.

you need that cert to sign your job off today? not a problem.

bring cash.
 

qcroanoke

Sometimes I don't know if I'm the boxer or the bag
Location
Roanoke, VA.
Occupation
Sorta retired........
it's funny... i've got one of those now.... after four months, and a few follow
up emails, i send one saying "when am i going to get a check in my hand?"

three days later, i get a reply by email, they will send a check the end of this
week... five minutes after that email, they send info on another job they want
me to do....

sure, wilbur.... the only reason you are still in my phone contact list, is if that
check ever does show up, i can then move you to the blocked list.

that other job? yeah, i'll do it, but i show up, do the cert, collect a check
on the spot, and after that check clears, i'll fedex you the certification.

you need that cert to sign your job off today? not a problem.

bring cash.
I love you man!!!!
 
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