Charging for estimates is not working!

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zappy

zappy

Senior Member
Location
CA.
Giving free estimates stinks,but at least you have a chance of getting the job.When i tell them there will be a charge and that charge will be wavied with a signed contract,they say no thanks.I explain to them that there not getting a "free estimate" that it's included in most contractor's estimate you just don't know it.If we all charge for a estimate then they will look for who charges the least for there estimate:rolleyes:
 
Mule

Mule

Senior Member
Location
Oklahoma
zappy said:
Giving free estimates stinks,but at least you have a chance of getting the job.When i tell them there will be a charge and that charge will be wavied with a signed contract,they say no thanks.I explain to them that there not getting a "free estimate" that it's included in most contractor's estimate you just don't know it.If we all charge for a estimate then they will look for who charges the least for there estimate:rolleyes:
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I can see for some in larger cities that a free estimate is costly to produce, however for me, I can be anywhere in town in less than 15 minutes and I usaully plan them while Im in the area. So they are not a big deal to me. However, your right when they hear the price, they generally run backwards, not all, but most...

as for back charging for the estimate, I do it, but Ive learned that the least the customer knows that, the better off you are...just clouds the decision process and sale....IMO
 
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billdozier

Senior Member
Location
gulf coast
why not just factor the time used on the estimate into total job cost. Therefore you offer (free) estimates but dont lose money. Sure you may not get every job but at least you get your foot in the door. Ethics and morals may be the only problem with this concept
 
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buddhakii

Senior Member
Location
Littleton, CO
billdozier said:
why not just factor the time used on the estimate into total job cost. Therefore you offer (free) estimates but dont lose money. Sure you may not get every job but at least you get your foot in the door. Ethics and morals may be the only problem with this concept
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If ethics and morals were a problem with this then most ec's would be in violation I think. Seems to me you're getting the same amount of $ in the end so why not offer the estimate for free. Probably make the phone ring more. I do see Mule's point though about it being costly in a bigger service area.
 
Mule

Mule

Senior Member
Location
Oklahoma
zappy said:
Giving free estimates stinks,but at least you have a chance of getting the job.When i tell them there will be a charge and that charge will be wavied with a signed contract,they say no thanks.I explain to them that there not getting a "free estimate" that it's included in most contractor's estimate you just don't know it.If we all charge for a estimate then they will look for who charges the least for there estimate:rolleyes:
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Your battling the culture of "free estimates".... its what most people expect, so just give what they want, factor it in, and go on down the road.

You can't expect to account for every hour spent, but you can factor in lost time into your rates................:)
 
jimport

jimport

Senior Member
Location
Outside Baltimore Maryland
Occupation
Master Electrician
You may be able to cover the cost of the "free estimate" if you get the job, but how do you cover the times when you don't get the job?

You still have lost time, gas, and wear and tear on the vehicle to cover.
 
Rewire

Rewire

Senior Member
Location
Lake of the Ozarks
I don't work with my tools my job is to get the work my salary is a part of overhead just as my office managers salary is a part of overhead.I can see a oneman show needing to bill every hour they can but they are at a disadvantage when they want to charge upfront for giving an estimate.I get a salary so I am paid wether I am posting on yhis forum or bidding a job.I look at it like being charged to walk into a store,the store doesn't charge you to walk in because they know you will be more likely to buy inside the store than looking in the window.
 
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buddhakii

Senior Member
Location
Littleton, CO
Add that to your overall "free estimate" cost. Like I said, if and estimate takes a half hour to get to then a charge is definatly in order, but if you can stop by somewhere on you way to work, to a job, to lunch, then free sounds a lot better then a charge.
 
Mule

Mule

Senior Member
Location
Oklahoma
jimport said:
You may be able to cover the cost of the "free estimate" if you get the job, but how do you cover the times when you don't get the job?

You still have lost time, gas, and wear and tear on the vehicle to cover.
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Not if you factor it into the jobs you DO get....:smile: For me, I dont do that many estimates, so the lost time isnt all that great. Estimates for me are just that "Estimates" like $150-$250 or $800-$1100, I dont spend alot of time on estimates, now "quotes" are usually a different deal, and they are high.
 
Mule

Mule

Senior Member
Location
Oklahoma
Rewire said:
I don't work with my tools my job is to get the work my salary is a part of overhead just as my office managers salary is a part of overhead.I can see a oneman show needing to bill every hour they can but they are at a disadvantage when they want to charge upfront for giving an estimate.I get a salary so I am paid wether I am posting on yhis forum or bidding a job.I look at it like being charged to walk into a store,the store doesn't charge you to walk in because they know you will be more likely to buy inside the store than looking in the window.
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Very well put, if you buy a product the cost of the bathroom and air conditioning is already factor'd in.....and so should a "Free estimate". Free should at least mean "No Obligation" .......Just a play on words, but that's what the customer is really looking for IMO
 
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emahler

Senior Member
billdozier said:
why not just factor the time used on the estimate into total job cost. Therefore you offer (free) estimates but dont lose money. Sure you may not get every job but at least you get your foot in the door. Ethics and morals may be the only problem with this concept
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yep...while this is the most common method for small contractors, it's also one of the least moral and ethical....

you charge your paying customers extra to pay for the time taken by non-paying shoppers...
 
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emahler

Senior Member
Rewire said:
I don't work with my tools my job is to get the work my salary is a part of overhead just as my office managers salary is a part of overhead.I can see a oneman show needing to bill every hour they can but they are at a disadvantage when they want to charge upfront for giving an estimate.I get a salary so I am paid wether I am posting on yhis forum or bidding a job.I look at it like being charged to walk into a store,the store doesn't charge you to walk in because they know you will be more likely to buy inside the store than looking in the window.
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what difference does this make? you still need to generate the money to pay your salary from some place....you just spend more man hours of your time doing it, with the cost spread out over more man hours billed to your customers...but the end result is the same...your paying customers are footing the bill for non-paying shoppers...
 
Mule

Mule

Senior Member
Location
Oklahoma
emahler said:
yep...while this is the most common method for small contractors, it's also one of the least moral and ethical....

you charge your paying customers extra to pay for the time taken by non-paying customers...
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So the next time you go to the store and buy something and dont use the bathroom, tell them you want a discount !!!! :D

Your really correct, Im just trying to make a point that its the culture that the customers want. They dont want a commitment, or obligation unless they hire you.......
 
Rewire

Rewire

Senior Member
Location
Lake of the Ozarks
emahler said:
yep...while this is the most common method for small contractors, it's also one of the least moral and ethical....

you charge your paying customers extra to pay for the time taken by non-paying customers...
Click to expand...

This is hourly employee thinking.Thats like saying the gas station is immoral because they charge me xtra for gas to pay for the guy just using the head.Overhead is a part of being in business and is factored into the cost.I stopped at a car lot to just look ,the guy that bought a car was paying for me to look.It is simply how business gets done nothing unethical about it the guy who bought the car was well aware that thier was mark-up to cover overhead.
 
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emahler

Senior Member
Rewire said:
This is hourly employee thinking.Thats like saying the gas station is immoral because they charge me xtra for gas to pay for the guy just using the head.Overhead is a part of being in business and is factored into the cost.I stopped at a car lot to just look ,the guy that bought a car was paying for me to look.It is simply how business gets done nothing unethical about it the guy who bought the car was well aware that thier was mark-up to cover overhead.
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rewire....you do make me laugh....thank you...we've danced this dance before....and you still don't see the forest from the trees...
 
Rewire

Rewire

Senior Member
Location
Lake of the Ozarks
emahler said:
rewire....you do make me laugh....thank you...we've danced this dance before....and you still don't see the forest from the trees...
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I do understand were you are coming from I just don't agree with the thought process that got youy there. The flaw in the slaw is the guy who calls up to ask if you can price over the phone this guy becomes a wild card because somebody has to pay for him.
 
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