Another Clueless Customer

[aline]

Some people just don't understand what's involved with running a business and the accociated costs. I just received this e-mail from a customer.

I really appreciated you coming to look at my house. I thought the price was too high for a day?s work of running copper through a few 2x4s. I will probably do the work myself. I?ve determined all the hardware will cost under $400 and a weekend or two of my time. If someone would come and perform the labor for a day?s pay and let me provide the hardware, then I?d be willing to discuss another estimate. Would you be willing to give me an estimate for the labor, if I provide the hardware?

When I was out looking at the job he kept telling me how he hated the way contractors charged him more for materials than what he could buy them for. He also was complaining about the work the electricians that wired his home had done.

I wonder how much he figures a day's pay is. I'm sure his idea of a day's pay and my idea of a day's pay aren't the same.

 

[brian john]

Email him back and ask him what he does for a living?

We all have to make a living, and we typically can't live on labor alone.

 

[Dennis Alwon]

I stated this before and I will state this again. I had a similar situation with a guy who owned a restaurant. He was building a house and wanted me to wire it but he would furnish the material. I simply said "If I come into your restaurant with a steak, will you cook it for me?" He asked what I meant and I told him to get some one else I wasn't interested. That same guy has ripped off more contractors to date thn anyone I know.

 

[B4T]

I give a (5) year warranty parts and labor for any job I do.

This is how I do business and the warranty is figured into the price.

 

[quogueelectric]

I had the perfect answer to this a couple of months ago. I was listening to a dinner owner who I had known to do illegal electrical work bragging in a local restaurant about how electricians are lazy and overpriced. So I confronted him infront of a large audience and said "How much does it cost to make a cup of coffee ?? maybe 20 cents with the cup and the lid and the 1 minute of labor to make it. I said you get 1.35 for a cup of coffee when you could sell it for 25 cents and make a 25% profit. Who is lazy and overpriced????? He shut his big fat mouth immediately and hasnt talked to me since. No big loss for me.

 

[480sparky]

If I cannot supply the material (other than luminaires), I walk away. Warranty will be an issue if the HO brings his crap for me to install.

 

[LarryFine]

Aline, figure what your markup would be, add that to your labor price, and add a few caveats, such as an hourly charge for unrpoductive time waiting for materials, or the right materials, plus an aggravation surcharge.

If he still balks, thank him for being honest about his intentions, wish him luck, and to give you a call if he decides to take you up on your proposal later. Mention an additional charge to un-do someone elses work.

Oh, yes, also mention there's no warranty on either materials or labor for anything he provides.

 

[ishium 80439]

I think you hit the nail on the head with "clueless". There are many people out there who truly have no idea what it takes to do what we do. They often have the attitude of "I could do that, it's easy". I think it is ignorance in the true sense of the word. Well the truth is a lot of what we do is not hard in terms of actual labor. It doesn't take a rocket scientist or a Herculean effort to drill a hole and pull a wire through it.

What the vast majority of people don't understand is that we have spent years figuring where to drill what hole and what type of wire to pull through it. If someone tells them exactly what to do in what order than of course they can do a lot of this themselves but that is where the trick is.

Every time I try a DIY project around my own house I get a new respect for what individual trades do. Sure I could figure out my taxes if I wanted to but why would I expend the time and effort when I have a CPA I can trust?

 

[goldstar]

When I was out looking at the job he kept telling me how he hated the way contractors charged him more for materials than what he could buy them for.

If you buy something for $1.00 and then sell it for $1.00 how much money did you actually make.:-? By the same token, would this person know what to actually buy for the job ? Would he just buy the wire and expect you to provide everything else (i.e staples, drill, drill bits, junction boxes, wire nuts, etc.)

He also was complaining about the work the electricians that wired his home had done.

Maybe he supplied that material too.

I wonder how much he figures a day's pay is. I'm sure his idea of a day's pay and my idea of a day's pay aren't the same.

The sad part is that someone is going to do the job and get the money. If you have enough work and can walk away from this job I would do so. If you need the work make sure you clearly spell out (in writing) what you would be contractually obligated to do and try to foresee what you might be libel for. If there's anything that you feel uncomfortable with - walk away and don't look back.

 

[growler]

Some people just don't understand what's involved with running a business and the accociated costs.

The cost of running a business is really not the concern of the customer. The main concern of the customer is to get the best price possible for whatever quality work they expect.

I would never go to a car dealer and ask what his overhead is, all I want to know is the price of the car. I don't even care if they lose money.

When I give an estimate I don't even get into the cost of doing business because that's not a concern of the customer. All I want to know is if the work is legitimate ( permitted & inspected ) and the start and completion date of the job. If I'm bidding against other contractors then I have some idea of about what the job will go for and this is close enough to get in the game. If the homeowner is going to do the work themselves ( buy materials) or hire unlicensed persons to do the work then there is no point in me even showing up.

When you are trying to sell a job just tell the homeowner that you are giving a competitive bid price and if they can get a better price they should take it. End of story.

It's impossible for the customer to rip off the contractor. The contractor is never forced to take a job. Some contractors are just stupid and cut their own throats.

 

[growler]

The sad part is that someone is going to do the job and get the money.

That's what bidding a job is all about. The customer wishes to compare prices.

The mistake made here is not asking the customer what he wants a bid on over the phone. Does the customer want a bid for completed job or a time and materials estimate or what? Why ever give a breakdown on what you pay or charge for materials.

I never give a price for materials and a seperate price for labor because that's none of the customer's business. The price they get on a bid job is the cost for completion of the job. This includes permits, material and labor with all associated cost to include travel & parking ( additional cost for additional work added).

If you are working time and materials then give a breakdown of materials cost but never on a bid job. The materials should never be part of it just a price for job completion.

 

[iwire]

I think Growlers post is excellent and contains great info that should stay in our head when dealing with customers. :smile:


We should not waste our time trying to make the customers care about our problems.

If you where negotiating the price for a car would it really make a difference if the sales person explained they just had to buy new advertising banners or that their taxes just went up or that the cost of the employees health insurance just increased.

Would you believe them?

Would you care?

Would you suddenly be willing to pay more for the car then the number you had in your head when arrived?

 

[aline]

Would you suddenly be willing to pay more for the car then the number you had in your head when arrived?

If the number I had in my head was not a realistic number, and I found all the dealerships were selling the car for more than the amount I had in my head, then yes, I just might pay more. I often have a number in my head of what I think something is going to cost only to find out I'm way off and pay more than I thought I was going to.

I e-mailed the guy asking what the other bids were to find out how my price compared and this was the response I got. Not everyone goes with the lowest price. I like to find out who they went with and why. Either he didn't get other bids or he doesn't want to tell me what they were.

I really appreciated you coming to look at my house. I thought the price was too high for a day’s work of running copper through a few 2x4s. I will probably do the work myself. I’ve determined all the hardware will cost under $400 and a weekend or two of my time. If someone would come and perform the labor for a day’s pay and let me provide the hardware, then I’d be willing to discuss another estimate. Would you be willing to give me an estimate for the labor, if I provide the hardware?

I e-mailed him back explaining that the price is a total price including labor, materials and profit. The only thing that really matters is that I charge enough to cover all my expenses and make a profit. If I charge less for material I'll have to charge more for labor to make the same profit. If I charge more for material I can charge less for labor and still make the same profit. If I charge enough for labor I can supply the materials at no charge at all or if I charge enough for materials I can provide the labor for free.

I'm sure you've seen the advertising for free labor when you buy enough carpet for the entire house.

How much do you think the mark-up is on that carpet?

I just like to follow up and find out why they did or didn't hire me.

In this case I failed to convey the benefits and value the customer would receive by hiring me instead of doing the work himself. It's not the customers fault. It's my fault. This shows I need to improve my selling skills. The customer is clueless and it's my job to inform them. It's easier and makes me feel better to just blame the customer though.

Where did I put those Zig Ziglar tapes?

 

[SEO]

Customers are clueless we gave an estimate (proposal) which the customer signed and thought was good. The job went well and we were at his house for a shorter amount of time than I had figured in my quote which I always hope for but doesn't always happen. The customer called the office stating that he should have a reduction in his invoice because he thought that nobody should make as much per hour as we do. We asked him if he was satisfied with the work he said that he was. We told him that we honored our side of the contract and expected him to as well. He paid in full.

 

[growler]

In this case I failed to convey the benefits and value the customer would receive by hiring me instead of doing the work himself.

It can be very hard to sell a job to some people because there is no "demand" for what you are selling and it can be almost impossible to create a "demand" for your services.

If the guy is in no hurry to get the work done and doesn't care about quality, safety or warranty then what have you got to sell? It's really hard to convince a customer that they can get the girls with a shinny new GFCI receptacle.

I think your customer is just a window shopper and won't buy anything unless there is a Fire Sale. Some of these people wait for years before getting even a little job done and end up wasting the time of countless contractors.

It's just my opinion but I think it's better to just pass some customers by and not even worry about them. They will always be more trouble than they are worth.

When a customer tells me they will do the work themselves I just say "enjoy it" and "have a nice day". You can't compete with a do-it-your-selfer or a handyman man or even a jack leg. You can only compete with other contractors and even that can be hard enough.

 

[bradleyelectric]

It's really hard to convince a customer that they can get the girls with a shinny new GFCI receptacle.

I have to agree. It's just not a qualified lead. Move on to a better lead.

 

[powerslave]

I think you hit the nail on the head with "clueless". There are many people out there who truly have no idea what it takes to do what we do. They often have the attitude of "I could do that, it's easy". I think it is ignorance in the true sense of the word. Well the truth is a lot of what we do is not hard in terms of actual labor. It doesn't take a rocket scientist or a Herculean effort to drill a hole and pull a wire through it.

What the vast majority of people don't understand is that we have spent years figuring where to drill what hole and what type of wire to pull through it. If someone tells them exactly what to do in what order than of course they can do a lot of this themselves but that is where the trick is.

Every time I try a DIY project around my own house I get a new respect for what individual trades do. Sure I could figure out my taxes if I wanted to but why would I expend the time and effort when I have a CPA I can trust?

I always say,"I can fill out a 1040 tax form for an individual. This does not qualify me as a CPA."

 

[powerslave]

I think Growlers post is excellent and contains great info that should stay in our head when dealing with customers. :smile:


We should not waste our time trying to make the customers care about our problems.

If you where negotiating the price for a car would it really make a difference if the sales person explained they just had to buy new advertising banners or that their taxes just went up or that the cost of the employees health insurance just increased.

Would you believe them?

Would you care?

Would you suddenly be willing to pay more for the car then the number you had in your head when arrived?

I talked to my counselor at the Small Business Developement Center about these kinds of people. I asked her, "How do I explain my costs to these people so that they understand what's involved in running a business and don't try to talk me down in price?" Her reply was, "Why would you want those people as your customers?"

It made so much sense it was like she smacked me upside the head.

 

[480sparky]

I talked to my counselor at the Small Business Developement Center about these kinds of people. I asked her, "How do I explain my costs to these people so that they understand what's involved in running a business and don't try to talk me down in price?" Her reply was, "Why would you want those people as your customers?"

It made so much sense it was like she smacked me upside the head.

Unfortunately, 99.9% of people out there are like this.

 

[AV ELECTRIC]

I spent 20 minutes at h@r block for my taxes and it came out to 500 dollars. Is that alot, yes i do see the dangers of this type of work that would justify this price. I know I dont make this amount but that being said it comes down to what people are willing to pay for a service.