Charging for estimates is not working!

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peter d

Senior Member
Location
New England
Get a free one-day pass to Sam's Club

...oh, but wait.

Odds are, you will actually purchase something there and Sam's will make a profit from that sale even if it's only a 100 count of "Big Red" chewing gum.......and a percentage of people WILL purchase a membership.

I'm pretty sure with the one day pass you pay a 10% premium over the posted price, at least the last time I read the fine print in one of those one days passes. This coupon appears to be a promotion where they wave the fee. Must be a "recession buster" special.
 

emahler

Senior Member
i'm beginning to really think that rather than having someones post count listed, we should list the # of years the poster has been running an actual company...seems that there is a definite difference in opinion that comes with being jaded by years of dealing with the same customers...

and it seems that there ends up being a pissing contest way to often between a veteran contractor and a guy that's been running his business for a year...

just a thought...
 

Rewire

Senior Member
i'm beginning to really think that rather than having someones post count listed, we should list the # of years the poster has been running an actual company...seems that there is a definite difference in opinion that comes with being jaded by years of dealing with the same customers...

and it seems that there ends up being a pissing contest way to often between a veteran contractor and a guy that's been running his business for a year...

just a thought...

People could just complete their profiles
 

Mule

Senior Member
Location
Oklahoma
i'm beginning to really think that rather than having someones post count listed, we should list the # of years the poster has been running an actual company...seems that there is a definite difference in opinion that comes with being jaded by years of dealing with the same customers...

and it seems that there ends up being a pissing contest way to often between a veteran contractor and a guy that's been running his business for a year...
just a thought...

i could...but i don't want to...i can't get mike to pay me for the information

edit to add - even filled out profiles don't always give the necessary information...

You, are harlarious..........:rolleyes:
 

Sparky555

Senior Member
i'm beginning to really think that rather than having someones post count listed, we should list the # of years the poster has been running an actual company...seems that there is a definite difference in opinion that comes with being jaded by years of dealing with the same customers...

and it seems that there ends up being a pissing contest way to often between a veteran contractor and a guy that's been running his business for a year...

just a thought...

It would be nice if the engineers and employees stayed off these subjects, but then they probably feel the same about me in their threads.

Regarding dispatch fees, I have to keep reminding myself that other people don't think like me.

I rarely pay a dispatch fee, but typically get a good reference and only ask them to bid my project. I have a flexible dispatch fee. Once in awhile I'll run a free one that's borderline just as a reminder for what a waste of time they are. The last one was "You're the low bid but we're considering our friend/brother/whatever who will do it way cheaper but can't do it for a few months.

I gave up running to every call a few years ago and my sales percentages are way up. More importantly my gross and net are also up.
 

Rewire

Senior Member
It would be nice if the engineers and employees stayed off these subjects, but then they probably feel the same about me in their threads.

Regarding dispatch fees, I have to keep reminding myself that other people don't think like me.

I rarely pay a dispatch fee, but typically get a good reference and only ask them to bid my project. I have a flexible dispatch fee. Once in awhile I'll run a free one that's borderline just as a reminder for what a waste of time they are. The last one was "You're the low bid but we're considering our friend/brother/whatever who will do it way cheaper but can't do it for a few months.

I gave up running to every call a few years ago and my sales percentages are way up. More importantly my gross and net are also up.
I love the arm chair quarterbacks, I like the saying"when reality conflicts with strongly held belief reality always looses out" I am the oppisite side of the coin we tried a "dispatch " fee last summer and I had a marked drop in our sales volume and we were 36% less for the month than last year on our gross our overhead is static so our bottom line also was off.After we dropped the fee we had an increase in sales,at this time of year and in this economy I am going to "chase" every call that comes in this is how I built the business so why abandone what has worked.
 

aline

Senior Member
Location
Utah
I am waiting for you to tell the story about the guy with the million dollar project that didn't use you because you charged a "dispatch fee"....
It may suprise you but I don't want the million dollar project.

When I sat down and came up with a business plan I decided I wanted to focus on residential and small commercial service and repair work. This would be my target market. My plan is to not try to land that one big fish of a million dollars at 5% to 10% net profit.

BigFish.jpg



My plan is to try to land one thousand small fish, at a thousand dollars each, at 10% to 20% net profit. Big fish don't necessarily equal big profits.

Lotsofsmallfish2.jpg


For small fish I troll different waters, use different equipment, different techniques and different bait to achieve the best results for small fish. I will even try different techniques and bait at times as conditions change to try to maximize my success of catching these small fish and still maintain my profit goals.

If I mostly catch big fish but occaisonally will go after the small fish I'm not likely to be as good at it as the guy who mostly catches small fish. The guy that mostly catches small fish isn't going to be as good at going after big fish either.

Most companies have a better chance of success if they target one market and stick with that market rather than try to be everything to everyone.
 
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aline

Senior Member
Location
Utah
By the way the uniform I wear to catch small fish doesn't look like the wardrobe of the guys in the photo. Although I have seen some electricians that dress like this. :)
Notice those two look a lot happier than the guy with the big fish. :)
 
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macmikeman

Senior Member
By the way the uniform I wear to catch small fish doesn't look like the wardrobe of the guys in the photo. Although I have seen some electricians that dress like this. :)
Notice those two look a lot happier than the guy with the big fish. :)

No, no, no... The guys who score the big fish get happier in the end. Do I need to tell you why?
080730_p17_life.jpg
 

powerslave

Senior Member
Location
Land of Lincoln
I am the oppisite side of the coin we tried a "dispatch " fee last summer and I had a marked drop in our sales volume and we were 36% less for the month than last year on our gross our overhead is static so our bottom line also was off.After we dropped the fee we had an increase in sales,at this time of year and in this economy I am going to "chase" every call that comes in this is how I built the business so why abandone what has worked.

Maybe it's a regional thing. I always charge a dispatch fee for service work and it works in my area. For estimates I'm now trying to charge a dispatch fee but offering a free panel inspection and GFCI safety check. I figure it gets me in the door.
 

emahler

Senior Member
Maybe it's a regional thing. I always charge a dispatch fee for service work and it works in my area. For estimates I'm now trying to charge a dispatch fee but offering a free panel inspection and GFCI safety check. I figure it gets me in the door.

you can't just suddenly charge a dispatch fee for what you were doing for free yesterday....you have to seriously change your whole system and what you offer the customer...additionally, most companies dispatch fees are minimal ($20-30)...they do not cover the cost of trip, but weed out the tire kickers...
 

Volta

Senior Member
Location
Columbus, Ohio
Charge it when you can

Charge it when you can

Well this has been a good thread, even if some of us . . . :wink:

But I have two things to say:

First- I make a definite distinction between an estimate and a quote, and I really can't tell how many others posting here do. I try to avoid estimates whenever possible, quoted jobs are so much simpler if and when we get them, no time or material to track, just do the work. And no stress for the customer about how much it will cost, a worker on the phone, whatever.

Secondly- For a long time, I have given "free" quotes, estimates, ballparks, whatever. The first time I told a caller that we charged a dispatch fee to look at a job (for a standby generator), he said ok. That felt good.
When I got there, I looked at the service, possible locations for the genset, and nameplates of equipment.
At the end of that walk through, I wrote the invoice for the dispatch fee ($50), wrote no charge for the gathering of information, and gave it to him. He wrote a check for the fifty I asked for.

My first thought was: "Wow, that's sure not much money!" At that moment I went from free quotes to charging at least something for that time, when I can. I wish it was longer ago than it was.
I'll give a free estimate, over the phone, based on responses from my questions. As I get my flat rate pricing better, my estimating gets better.:smile:

If a new resi cold call comes in now though, and they want me to come to the property, it is at least a dispatch fee, when possible.
 

powerslave

Senior Member
Location
Land of Lincoln
you can't just suddenly charge a dispatch fee for what you were doing for free yesterday....you have to seriously change your whole system and what you offer the customer...additionally, most companies dispatch fees are minimal ($20-30)...they do not cover the cost of trip, but weed out the tire kickers...

My dispatch fee for service work is $75.00. This is what I've been charging for 2 years now. It works in my area.

A $20-30 service charge for estimates would definately weed out the tire kickers. But since it's not covering the cost of the entire trip I would still have to add the rest into my overhead. Wouldn't that come back to the customers accepting the estimates having to cover the cost of the ones who don't?
 

emahler

Senior Member
My dispatch fee for service work is $75.00. This is what I've been charging for 2 years now. It works in my area.

A $20-30 service charge for estimates would definately weed out the tire kickers. But since it's not covering the cost of the entire trip I would still have to add the rest into my overhead. Wouldn't that come back to the customers accepting the estimates having to cover the cost of the ones who don't?

It would, with the caveat that your closing rate would increase dramatically. So the amount being apportioned to each customer would be minimal as a percentage.
 

satcom

Senior Member
you can't just suddenly charge a dispatch fee for what you were doing for free yesterday....you have to seriously change your whole system and what you offer the customer...additionally, most companies dispatch fees are minimal ($20-30)...they do not cover the cost of trip, but weed out the tire kickers...


Your pretty much on the figure, out of the 20 or 30 service guys in or arounf my town they all charge between $30 to 40 dispatch fees, and eat the loss they take on each call, so the loss goes into the overhead and operating loss account.
 
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