Anyone interested in givng advice for failing EC

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CopperTone said:
I can't win a bid either - I even keep lowering my baseline for figuring the bids and a few guys blow me out of the water with their bids. I cannot understand for the life of me how they are doing it.

They have to be slamming the GC with change orders and add ons. Learn that game and you'll do ok. Unfortunately you have to leave your "I'm a nice guy" coat at home.

Get a great attorney and learn the legalities of the contracts you sign.
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I learned this in the residential market you cannot bid a house based on what it will actually cost you bid it to minimum and whack them on every change.Thats why I dont do many houses
 
petersonra said:
There is currently an oversupply of EC for the amount of work there is in much of the country.

You either find a way to survive for the time it takes things to get better or you move on to something else.

Obama recently signed an XO all but banning non-union companies from federally funded projects. In any case, it won't affect stuff that is already in the pipeline, but stuff coming down in the next few years will be affected. Depending on your union status, that may, or may not, be of some help to you down the road.
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Do you have any sources or links? I'd like to follow up on this.
 
Palmbay said:
I am not hitting the mark to stay in business. I know my costs, I attempt to pay myself. I can not get awarded projects that hit my costs. I am usually 10% to 35% off winning bidders. If I hit those marks I would not get paid, and eventually go out of business.
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yes, you will.

i was listening to a conversation today between two executives getting ready
to put a job out to bid. the question came up, how many subs on the job walk,
and the answer came up, 6 or 7 for each craft.... they have 8 electrical
contractors bidding. i'm not one of them, thank god.

and the answer came back... pump it up more. if our client doesn't see 10
subs per craft fighting for the work, in this market, he will think we aren't
doing our job.

further discussion led to the frank statement that it was just a matter of
putting guys in a room and seeing which one of them wants to jump on
the grenade. one of them will be dumb enough to pay for the privilege of
doing the work.

the only conclusion that makes any sense, is if you are bidding work today
against a dozen other guys, and you are getting the bid, you're doing some
thing very, very wrong. :mad:

if that sounds insane, it comes from a time and place where interest on
money has gone to -.5%, for T Bills.

we're all on brand new ground here. i bid a job at about 18k, 12 in materials,
and 6 in labor... nothing to get rich on, but at least work.

it went to a guy who's total price was $9,800. i can't even buy the material
for that, and i get pretty good pricing.
 
FWIW

I just read an article about a school upgrade, and the award amount.

All the estimates came in 26% less than they had budgeted it for.

They budgeted 15.7 million, and the award was 11.2 million.

Silver lining for the school district with so many people hungry for work.
 
Are you sure you are failing? I mean you are not landing jobs but that doesn't mean you are not doing things the right way. You could work for 1/2 price - you would then land jobs but do you really want to do that? I don't hope the lowballers go out of busines - I'd hate to see anyone fail but they certainly are not helping the industry - you don't see restaurants slashing their menu prices in half just cause the guy across the street did - because the guy across the street won't.
It still costs a certain amount to run your business and make a profit. The smallest shops 1-2 guys are in the best position to weather this because of low overhead. You should concentrate on lowering your overhead to as low as possible - you don't need office workers if there is no work - lay them off and do it yourself, use your basement or spare bedroom as an office for this year to eliminate paying for an office. Buy only what you need for that job that day. Be sure you get paid for every job you do.

Most everyone in construction is hurting in this country - some guys are doing fine - most are starting to panic. I just was talking to 2 separate union electricians last week - one said he has been working all along and will be on a job for the next 2 years and the other one said he hasn't worked in 14 months.
 
Marketing
-Regular attendance to Remodeler council and Green Builders council at the Local Builders Association
-Trucks lettered
-Web page
-Collar shirts with logo
-Camber of Commerce member, not very active, I could change that
-Builders shows
-Pounding pavement lately, going to showrooms and getting into people faces with what I can do for them and there customers
-Cold calls, I have been doing this but I don't do it well and I don't like doing it
-I think I still have an ad running in the phone book, but that has never brought in work, I canceled all of them
-Blue book of construction gave me a lot of leads that 10 million other guys are scrabbling for, canceled that
-Ads in news papers did not bring in target customer, target customer is age 25 to 100 with household income over $50,000 per year


I am not very creative, so coming up with a flyer or material is hard and time consuming. I am too meticulous to be happy with anything creative I can come up with. Hell just about every time I read my web page I find a typo.

The past year I have started offering some other services, electrically related, but that is like trying to start a new business with no customers to start. I have also focused on getting technical training on other aspects of the industry that I am interested in and could be a revenue source.

I spoke to another electrical contractor in my area yesterday, and he is closing shop. He gave his customers to his father in-law that is also an EC. He sounded like he was charging less than I am, and basically working to hard for peanuts. I have lowered my prices in the last year and a half, but I know what I need to make, and I refuse to go under just to get work. I will go work for someone else before that happens, and that is what the other EC did.

Currently I am averaging 1 service call a week for the last year that will average $1200 in sales, and I had a large residential renovation end in Nov. That is it. Put out a lot of bids on big and small stuff. Big for me is 15,000 sqft house, or commercial property. Hell the last 2 small renovations I bid, around $1900 in electrical work, I actually made a blue print for, to try and separate myself from the cheaper competition. I think that back fired and made it even easier for competition to under bid. These numbers get my over head to a breakeven point, and pay my helper and supplier. I am not in debt, except for truck and van payment, together under $500 per month. I could sell the truck, but the money saved will not change the fact that I am not getting enough work for an income.

Most of the good contacts that I had when I was busy are out of business, not getting any business or using the cheap guys cause they are cheaper.

I guess in a year or so, maybe allot of these cheap guys will be out of business, but its going to be a rough ride getting to that point.

My wife said just go work for somebody, but to keep my lic. active, I still need to keep up insurance, and business lic. and stuff like that. It will still cost the same overhead, and I would be taking that out of my taxed pay check. Ouch. Tough times.

Thank you for listening to me blubber.
 
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I am not sure if I am reading it right but one service call a week for 52 weeks should be more than 1200 or is it 12000. Service calls can be money makers for the small EC .If you want into the service market then advertise to that market.I think the biggest obstacle that the small EC encounters is finding their next job while working on the one they have.
 
Rewire said:
I am not sure if I am reading it right but one service call a week for 52 weeks should be more than 1200 or is it 12000. Service calls can be money makers for the small EC .If you want into the service market then advertise to that market.I think the biggest obstacle that the small EC encounters is finding their next job while working on the one they have.
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You hit the nail on the head.

Late nights is how I have done it in the past.

$1200 gross per week average for the last 6 months. One Thousand, two hundred.

I almost grossed 1/2 a milion in 2006. With average 3 employees/helpers.

I am just talking about the work I am getting. These customers are existing customers, not new customers. My client list is maybe 200 customers. I think it is expensive to break into an all service shop. It will take a while to be able to justifiy advertising numbers. And now is not the time for me to spend what I have saved on advertising, I don't think, I could be wrong.

I really want to diversify into more commercial work, but the contractors in my area seem loyal to there subs, and not interested in using me unless I am the low guy. Breaking into this market would be ideal for me.
 
Im in the same boat, I figure I will bail till I get stimulated.

Im in the same boat, I figure I will bail till I get stimulated.

Get an internet site going. The internet site got a few calls here. Its comparatively cheap. The younger set goes to the internet before the phone book. Gives you status. I used the Yellow page internnet service but I found out later that there were cheaper options. Get a professional design done with key words that get you noticed by google.
There are EC's working for other shops here too. The times they are a changing. Im about ready to work weekends at this and a real job else ware. I understand its worse down there. Go to your strengths. Look out for inflation its starting to hit here like a freight train. Revise your material pricing so you are not plugging leaks with a drill bit in a sinking ship. Image is a keystone to marketing. Go to stores and look at there lighting, make suggestions if they are open to it. Cold calls are tough but they work. Somebody here once said they had a bucket truck and would drive around at night looking for signs that needed re lamping then approach the owners the next day. Its time to think outside of the box.:cool:
 
CopperTone said:
I can't win a bid either - I even keep lowering my baseline for figuring the bids and a few guys blow me out of the water with their bids. I cannot understand for the life of me how they are doing it.

They have to be slamming the GC with change orders and add ons. Learn that game and you'll do ok. Unfortunately you have to leave your "I'm a nice guy" coat at home.

Get a great attorney and learn the legalities of the contracts you sign.
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There are contractors who are very good at scraping by. Its not about slamming people with change orders. It is about bidding the bare minimum the contract requires and charging the customer for anything extra. Customers cannot expect to take the low bid and think they are getting anything above bare minimum.
 
Pete Benoit said:
He said that today in his town hall meeting,I wish I could call him up and tell him that palmbay is ready to start installing efficient lighting in the local USAF base or any other green jobs he spoke of ,that can not start due to the lack of electricians
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one would think it would not be all that hard to import unemployed electricians from other areas of the country if there was such a need.
 
Palmbay said:
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I am just talking about the work I am getting. These customers are existing customers, not new customers. My client list is maybe 200 customers. I think it is expensive to break into an all service shop. It will take a while to be able to justifiy advertising numbers. And now is not the time for me to spend what I have saved on advertising, I don't think, I could be wrong.
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Over the next few days reintroduce yourself to these 200 people face to face heres my line " Hi (insert name) , I'm here because with summer right around the corner I am setting uo my schedule for the next few months.I wanted to check with you to see if you had any projects that you were looking at getting done this summer."

at this point your customer may give you a lead to follow up on or will simply say no at this point you thank them.I woulkd leave a card and remind them we had a 24 hr service truck for emergencys

An old saying You have to spend money to make money
I really want to diversify into more commercial work, but the contractors in my area seem loyal to there subs, and not interested in using me unless I am the low guy. Breaking into this market would be ideal for me.
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Sounds like this market may be saturated
 
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hang in there!

hang in there!

Mike Hang in there! I recently heard that there are more people now leaving Florida, than moving to Florida. But you have a huge population to generate business from! You will definitely have to "adapt and overcome" the current sitiuation. Some guys hate to do troubleshooting work! It may come down to doing more of that. Look at the overall picture. Get out and about and get the work! Good Luck!!
 
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