First year in business and just had my first digruntled customer

[220/221]

Who are we to dictate to him that he's wrong?

We are his brothers.

A lot of us have been mule. A lot of us are Mule.

This mule realized a long time ago that he couldn't keep working at the same pace forever. If we want to prepare for our future we had better make a crapload of money while we are relatively young or build our business to run without us. Ideally, a little bit of both.

He doesn't have to be a 100 man shop but his ability to perform tasks are diminishing as we speak. He will need to do something different unless he has no expenses. I am pretty healthy but I can't do half the physical work I did only a decade ago.

 

[bradleyelectric]

his ability to perform tasks are diminishing as we speak.

you don't want to stand to close to him. That stuff can jump 3'

 

[John Davoltra]

I, too, am Mule! (raises hand abruptly)

I just now am stepping out of one of these misunderstandings with a customer. Once again I tell myself no more handshakes.

I will elaborate later (after my final payment) on the exact way it happened. You guys will lose your minds when I tell you how much work was done for the amount I charged, and was basically told he felt like a sucker. He is a surgeon. You guys know...

Mule, the problem with verbal agreements is that for a long time things go great and everything works seamless. Then it happens. This is the first time in several years for me. And if I keep doing handshakes it WILL happen again, as it has in the past.

I ustilize T&M ,too. A little background on me. 13 years in business. 70% resi, some commercial, rental, light industrial accounts. Small town/rural TX. Self-employed with no employees. Had a decent +/- apprentice for a couple years that made me a $ or 2.

My work is quality and I get almost no call backs. In fact, most of my residential service calls are to fix weekend warrior and inexperienced help problems. I select premium equipment. When I give a verbal quote it is as good as gold. I usually do too much extras for free. I generally am too nice. I don't have change order forms. (I just got killed on yet another new house - never again) The next new house I start ALL plans will be given me (before I nail up a 22 cent box) down to the cabinets and trim. Idiots are out there building. Women can't decide. UGHH!

I am frustrated and have little savings. I really thought I would be financially independent by now. I do have a lot of equipment, however.

It is late and I am tired, so I will tell you my current thoughts for my business as I think you and I are like individuals from like surroundings.

1. No more handshakes for anything over a couple hours work. SIGNED.
2. If and when I hire help it will be a journeyman-minimum.
3. My help will be contracted with hourly plus commission.
4. Minimize my T&M jobs.
5. Cut out the client base expecting inexpensive work. I will sell my VALUE.
6. I will USE CHANGE ORDER FORMS

Summary. T&M will get you where I am in a decade. It is a great way to start out and being nice will get you a fast word-of-mouth client base, but in the end it will bite you back.
If you haven't already been bitten by the government and the expenses incurred there, just wait. Insurances, continuing education, business use private property taxes, state licensure, vehicle expenses, income tax woes, state income taxes?, book keeping time, weekend service calls, losses, thefts (just 'lost' a $600 drill), fuel, rentals, etc. These are just a few of the reasons we can't clear the kind of money we need from T&M. T&M should probably be $150/hr to make it worthwhile.

One question- when have you ever been extremely pleased with the monetary outcome of a T&M job............?
(Hey Jim! I just calculated the true cost of my business and I just cleared $14.11/hr! Meanwhile Jim is off on the weekends and makes $53k/yr working for someone else and has an organized shop in his backyard...he may even have time for a hobby!...)

I am here to learn right along with you, Mule. I pray that you learn sooner than I did.

 

[adamants]

starting

starting

as all good business advisers will tell you, Start as you intend to be, don't T&M "for now" if you intend to flat rate, yes you may feel as though you are doing the right thing, but PLEASE take it from all of us who have "been there, done that and suffered", it is simply not good for you. Yes it may be working for you at the moment, but have you actually sat down and calculated you overheads? do you know what each man hour COSTS you? I am not saying do you want to make $20 an hour after tax. Remember that yes in the first year there are all those horrible set up costs, but take it from me, there is always something else to suck the money. Do you know how much being in business will cost/. I used to think people in business were "rolling in it" they must be so rich! until I started my business.
You need to budget for a very good wage, why not, after all, the entire responsibility rests on your own shoulders.
You also need to budget to be able to make a reasonable profit on top of this, after all, you need a reasonable return on your investment, other wise what the h**l are you doing in business?
Employees are very expensive, yes you may do a service change in 8 hours, but more often than not, an employee will take 10 or 12 hours.
I have looked into paying my employees flat rate wages per job, however this is a very tricky thing to do if you actually go in to all the anomolies in depth. what happens if you quote 10 hours, but you should have quoted 13 hours, the employee's not going to be happy working 3 hours for free, and you wont want to keep wearing the extra time.
I beleive it can be done and am working towards this.
BUT, please listen to the advise from some of the senior members in the forum, as i have learnt more from this forum, than i have in my 12 years in the trade.
We aren't taking a shot at you, but really trying to help everyone reading the forum, for free. Mistakes are a lot easier when someone else makes them instead of you!
Good Luck
Anyone wanting my customer approval form to browse at, just PM me and i will email it to you.

 

[Mule]

Guys, your too kind, but the truth is, Im just standing up for my self, in these type of exchanges, not to be brow beaten...That's the stuborn Mule mistake, as I encouraging you. In fact Im done talking about T/M vs other means, and I've been done for a long time...So I guess its a mental thing, making you think I want more and more, when in fact I dont....please stop......I am amazed how one can justify that if I get one dis-gruntled lady from a years worth of happy customers that you can quantify that to say, "its because of the way you charge" when it was cleary because I didnt communicate with her well enough, verbaly and by my vergage on my invoice, and the the fact that she's in over her head and doesnt understand.

So please understand Emahler, Rewire, BradleyElectric....I dont want to be a large shop, Ive never said that, Ive repeatedly voiced my desire to be more open with my customers with my business dealing, and I shouldnt have to defend myself any further to you guys about it....and if I let it slip by mentioning a price in a job discussion, it doesnt mean Im asking for you opinions again about my pricing structure......just like this thread, it wasnt about the money, it was about me voicing this ladies outrage, in contrast with my other 99% of my happy customers. And here I am again being preached to about old dirt.....nothing personal, and if I've given the wrong message in the way I post, I appologize...

Please drop it.....

Up with a back ache 3am.....Thank God for Icy hot...

 

[jrannis]

The system has already been created.
There's no need for you to re-create it.
You just need to learn about the system, how it works and then implement it.

These guys have the system down to a science.

http://www.clockworkhomeservices.com/

Nice and slick.
I really like the part about on time or its free!

Not for me, Thanks anyway.

 

[Dnkldorf]

The system has already been created.
There's no need for you to re-create it.
You just need to learn about the system, how it works and then implement it.

These guys have the system down to a science.

http://www.clockworkhomeservices.com/


This tells me other wise.

You don't mind if I correct this a bit do you?

I think it should read:


One system has been created.
I think there is no need for you to recreate it, but feel free to hybrid it, if you like.
You just need to learn about this particular system, how it works, and if you choose later that is might be something you're interested in, you can impliment it how you see fit.
These guys have their particular system down to a science, but keep in mind, it is not for everyone as there are many other systems out there that other people use and they are just as successful as these guys.

 

[growler]

There is another way of looking at this incident that's much more serious.

This lady is not just a disgruntled customer she is in fact accusing mule of deceptive business practices. Charging twice for the same services.

A customer can complain about your prices being to high all day long and there is no law against that.

If you are found guilty of deceptive business practices you could easily lose your license. That's why it's important to keep you paperwork as clean as possible.

Another thing that contractors don't think about, if you are ever found guilty of an OSHA violation it will probably be a paperwork violation and not a real safety violation. They actually would have to catch you to issue a safety violation but it easy to give out paperwork violations as most contractors don't keep their paperwork up to date.


Shake hands all you want but try to cover your rear as much as possible.

 

[Mule]

There is another way of looking at this incident that's much more serious.

This lady is not just a disgruntled customer she is in fact accusing mule of deceptive business practices. Charging twice for the same services.

A customer can complain about your prices being to high all day long and there is no law against that.

If you are found guilty of deceptive business practices you could easily lose your license. That's why it's important to keep you paperwork as clean as possible.

Another thing that contractors don't think about, if you are ever found guilty of an OSHA violation it will probably be a paperwork violation and not a real safety violation. They actually would have to catch you to issue a safety violation but it easy to give out paperwork violations as most contractors don't keep their paperwork up to date.


Shake hands all you want but try to cover your rear as much as possible.

Good Grief Growler, havent we already covered this customer? havent we already stated the obvious defeciencies in the transaction? indentified the problem, and addressed them? give it up ....personaly, your just trying to be damaging...or at least that's what it seems. Why are you that way? all because I want to charge T/M? or is the handshake that has your shorts tied in a not? Im not asking for guidenance here? I've already had 40 tons of it.....

 

[Rewire]

Every good thread must end and I feel that this one has been on life support for a while.

 

[aline]

These guys have their particular system down to a science, but keep in mind, it is not for everyone as there are many other systems out there that other people use and they are just as successful as these guys.

Can you give an example of someone just as successful as these guys, doing residential service and repair work, using a different system?

I've looked but have not been able to find anyone.

 

[satcom]

Every good thread must end and I feel that this one has been on life support for a while.

I agree. it needs to take a vacation.

 

[ohm]

I agree. it needs to take a vacation.

I'll drink to that!

 

[emahler]

Can you give an example of someone just as successful as these guys, doing residential service and repair work, using a different system?

I've looked but have not been able to find anyone.

We are running on over 4 yrs without him being able to produce this.

 

[Rewire]

http://www.entrepreneur.com/franchises/categories/homehomer.html

http://www.franchising.com/home_repairs_franchises

http://www.americasbestfranchises.com/Home-Improvement-Franchises

These are just a few of the sites that offer franchise opertunities each one is selling a "system" most of this stuff you can learn through trial and error or glean from others who are in your business the only difference is time. I can build a sucsessful hamberger joint or buy a Mc Ds franchise (if I qualify)

 

[Dnkldorf]

Can you give an example of someone just as successful as these guys, doing residential service and repair work, using a different system?

I've looked but have not been able to find anyone.

So, anyone not using this system, is not successful?

There are guys on this site, that don't use this system and are successful.

That has to be the most ignorant statement made, and shows your true colors.

 

[Dnkldorf]

We are running on over 4 yrs without him being able to produce this.

Just go out and try starting your own business, come back and tell us what works for you.
(or your dad)

 

[220/221]

Every good thread must end and I feel that this one has been on life support for a while.

______^______^_______^__________________________________________________________________

 

[Rewire]

TOD 4;47 pm

 

[rt66electric]

Whats step two???

Whats step two???

I, too, am Mule! (raises hand abruptly)

I just now am stepping out of one of these misunderstandings with a customer. Once again I tell myself no more handshakes.

I will elaborate later (after my final payment) on the exact way it happened. You guys will lose your minds when I tell you how much work was done for the amount I charged, and was basically told he felt like a sucker. He is a surgeon. You guys know...

Mule, the problem with verbal agreements is that for a long time things go great and everything works seamless. Then it happens. This is the first time in several years for me. And if I keep doing handshakes it WILL happen again, as it has in the past.

I ustilize T&M ,too. A little background on me. 13 years in business. 70% resi, some commercial, rental, light industrial accounts. Small town/rural TX. Self-employed with no employees. Had a decent +/- apprentice for a couple years that made me a $ or 2.

My work is quality and I get almost no call backs. In fact, most of my residential service calls are to fix weekend warrior and inexperienced help problems. I select premium equipment. When I give a verbal quote it is as good as gold. I usually do too much extras for free. I generally am too nice. I don't have change order forms. (I just got killed on yet another new house - never again) The next new house I start ALL plans will be given me (before I nail up a 22 cent box) down to the cabinets and trim. Idiots are out there building. Women can't decide. UGHH!

I am frustrated and have little savings. I really thought I would be financially independent by now. I do have a lot of equipment, however.

It is late and I am tired, so I will tell you my current thoughts for my business as I think you and I are like individuals from like surroundings.

1. No more handshakes for anything over a couple hours work. SIGNED.
2. If and when I hire help it will be a journeyman-minimum.
3. My help will be contracted with hourly plus commission.
4. Minimize my T&M jobs.
5. Cut out the client base expecting inexpensive work. I will sell my VALUE.
6. I will USE CHANGE ORDER FORMS

Summary. T&M will get you where I am in a decade. It is a great way to start out and being nice will get you a fast word-of-mouth client base, but in the end it will bite you back.
If you haven't already been bitten by the government and the expenses incurred there, just wait. Insurances, continuing education, business use private property taxes, state licensure, vehicle expenses, income tax woes, state income taxes?, book keeping time, weekend service calls, losses, thefts (just 'lost' a $600 drill), fuel, rentals, etc. These are just a few of the reasons we can't clear the kind of money we need from T&M. T&M should probably be $150/hr to make it worthwhile.

One question- when have you ever been extremely pleased with the monetary outcome of a T&M job............?
(Hey Jim! I just calculated the true cost of my business and I just cleared $14.11/hr! Meanwhile Jim is off on the weekends and makes $53k/yr working for someone else and has an organized shop in his backyard...he may even have time for a hobby!...)

I am here to learn right along with you, Mule. I pray that you learn sooner than I did.

Hey guys keep this thread going.. I'm like mule and John an adamants and others. Thanks for the warnings/ advice/ in the realworld actualities.

Whats the next step after one-horse shop.

I don't feel like a franchise is worth investing in,- SUBWAY sandwiches as a franchise makes a lot on money, but ask a single store owner. Use the franchise method as model, but start your own name and number!!!

I would like to say more but I got to go to help at kids baseball (they actually let me play) how do you insert simily faces in the middle of a sentence???? DENNIS