Outbid by Big Orange

[ceb58]

It's not any different than a general contractor subbing electrical work. The question would be, is Home Depot a licensed general contractor?

If they hire a licensed general contractor to pull a permit for this job then everything is legal but if it's a homeowner permit then it's not because Home Depot would be the prime contractor and the others just subs and the homeowner would not be doing the work himself.

I think I would drive by that job just to see who has the permit.

And that is the point in the legal scheme of things. I have never had a GC look at a job and price the electrical. He would call me, I would look at it or the prints and give him a price. He then compiles all prices for the work to be done and submits one total cost.

I looked at a kitchen and priced it accordingly then I got the call, when the Orange guys were measuring for the cabinets they estimated the plumbing and the electric also and his price was lower.

For some reason I didn't know the Depot did this kind of work but hey...its a learning experience. I told the guy beware of up sells and have a lovely time. Does the Orange offer any kind of electrical work or just kitchens?

It is not like they are grabbing the guy working on isle 5 and sending him out to do electrical

.

Read the OP. Big orange guys measuring for cabinets. They estimated the plumbing and elect. Now how are they qualified to price electrical work?

I know that orange and blue advertise products with an installed price. They have licensed contractors that do the install for a (cheep)flat fee. It is up to the contractor to up sell while he is there or charge for additional work such as installing ceiling fan rated boxes, extra switch legs and such. But for there guys to go out and start pricing other work for the subs is a fine line between offering a service and contracting.

 

[Mgraw]

I looked up HD on the Louisiana contractors site and HD is a GC in Louisiana.

 

[growler]

The question would be, is Home Depot a licensed general contractor?

I looked up HD on the Louisiana contractors site and HD is a GC in Louisiana.

Well that answers the $64 question. If they have a GC license in Louisiana then they probably hold one in some other states as well and are in direct competition.

I guess that between the Wal Mart Hospitals and the Home Depot Funeral Homes they can cover everything from cradle to grave. Just joking but it is getting close.

 

[brian john]

Here in Louisiana you don't need a GC unless the job is over $75,000. All you need is a remodeler license. Sign a form, pay a fee and you are a remodeler. I don't get the complaints. HD is using trades people to do the work. It is not like they are grabbing the guy working on isle 5 and sending him out to do electrical.

Read back in the thread, it is the fact that SOME ECs are buying their supplies (giving cash) to their competition. No more, no less, it makes sense from HD's stand point and it simplifies remodeling for some consumers.

 

[Mgraw]

I understand some buy their materials from there. They do so because HD's price is usually cheaper than a supply house. When I was re-wiring houses after Katrina I bought everything from HD. HD was the only place we had. When they reopened they didn't have a building to use. The store was outside in the garden center. They never gouged us like just about everyone else did. Those that buy there can always go somewhere else.

 

[fww56]

How is Home Depot (or any of the big box stores) offering a product or service at a reduced price to the consumer any different then the big box stores offering products to contractors at a price less than the traditional supply house? This is a catch 22 that a lot of contractors have put themselves in. Many were quick to abandon the traditional outlets for their materials, tools and supplies by flocking to these big box stores. Now the shoe is on the other foot. Maybe the former counter guy from the closed supply house has found new employment as an installer for one of these companies. Poetic justice maybe?

The few times that I find myself perusing the wares at one of the big boxes, it is not unusual to see me on my phone to my supply house giving them a full report on the current prices of their competition.

The American way has become how to get the best value for the dollar with no regard for the long term implications. From the import invasion of foreign automobiles in the last century to the proliferation of the Wal-Mart and Dollar Trees type stores and the associated loss of American industry, this is but a part of the long term implications.

Add to this the standards of living in the third world countries and the resulting lower costs of production combined with the regulations domestic manufactures have to deal with it doesn't look good for us in the "long term".

FRANK

 

[brantmacga]

I know that orange and blue advertise products with an installed price. They have licensed contractors that do the install for a (cheep)flat fee.

Not every HD advertises an "installed" price for electrical work, and as the contractor that's not necessarily what HD is paying you for the job. You can charge whatever your normal rate is and its up to HD to recoup that amount from the customer if they wish to do so.

It is up to the contractor to up sell while he is there or charge for additional work such as installing ceiling fan rated boxes, extra switch legs and such.

not quite how it works. refer back to my first comment.

The few times that I find myself perusing the wares at one of the big boxes, it is not unusual to see me on my phone to my supply house giving them a full report on the current prices of their competition.

why are you wasting time with that?

 

[jusme123]

how is home depot (or any of the big box stores) offering a product and service at a reduced price to the consumer any different then the big box stores offering products to contractors at a price less than the traditional supply house? this is a catch 22 that a lot of contractors have put themselves in. Many were quick to abandon the traditional outlets for their materials, tools and supplies by flocking to these big box stores. Now the shoe is on the other foot. Maybe the former counter guy from the closed supply house has found new employment as an installer for one of these companies. Poetic justice maybe?

The few times that i find myself perusing the wares at one of the big boxes, it is not unusual to see me on my phone to my supply house giving them a full report on the current prices of their competition.

The american way has become how to get the best value for the dollar with no regard for the long term implications. From the import invasion of foreign automobiles in the last century to the proliferation of the wal-mart and dollar trees type stores and the associated loss of american industry, this is but a part of the long term implications.

Add to this the standards of living in the third world countries and the resulting lower costs of production combined with the regulations domestic manufactures have to deal with it doesn't look good for us in the "long term".

Frank

competitive bidding is the major difference

 

[fww56]

competitive bidding is the major difference

What does competitive bidding have to do with it? It's private money involved so there is no obligation for them to put this out for bid. These companies have contractors that they've established a relationship with. If you want an opportunity to do this work, agree to their terms. It's no different than when your neighbor has work done and does not invite you to give them a price. Nor is it any different than one of your repeat customers hands you a job without entertaining any bids from your competition.

Generally there is a set price, often set by the GC (Home Depot in this case) with a take it or leave it attitude. Somebody always seems to be in line to take it. This is not exclusive to the electrical contracting industry. Most sub contractors working for many of these large general contractors, cabinet installers, roofers, siding installers etc. are now and have for a long time been dealing with this situation. There again, take it or leave it. They've got a whole drawer full of business cards from other contractors that are waiting for their turn in the barrel.

As far as competitive bids, how many contractors have approached their supply house to see if they would match their competitor's (Home Depot and others) prices. I have and my supply house has been able to get close enough that I prefer to give them my business. My attitude is that it's not all about money, service is just as important to me. I prefer the service I get at my local supply house and hopefully my business and others like me will be enough for them to keep their doors open and be there when I need something other than the run of the mill items found on the big box store shelf.

FRANK

 

[LarryFine]

The few times that I find myself perusing the wares at one of the big boxes, it is not unusual to see me on my phone to my supply house giving them a full report on the current prices of their competition.

Frank, what do they do with that info?

 

[guschash]

I buy 90% of my material at my supply store only if I am on a job and HD is closer will I buy at HD if I need it to finish. I charge all material to the job I am working on and some tools if I need it on the job.

gus

 

[wireguy8169]

I understand some buy their materials from there. They do so because HD's price is usually cheaper than a supply house. When I was re-wiring houses after Katrina I bought everything from HD. HD was the only place we had. When they reopened they didn't have a building to use. The store was outside in the garden center. They never gouged us like just about everyone else did. Those that buy there can always go somewhere else.

I am neutral from whom I buy from, but when HD is $200 bucks cheaper on a few materials for a job especially a bid job then thats money in my pocket. I do see the competition thing but they are not so big into it that its going to wipe us all out...well not yet :roll:

 

[Mgraw]

I don't have a problem with HD. Like I said when I was doing residential I bought everything from them. They gave me good service. The people at the pro desk were always helpful. They would call every week to see if I needed anything. I still buy some things from them.

 

[ElectricianJeff]

As far as competitive bids, how many contractors have approached their supply house to see if they would match their competitor's (Home Depot and others) prices. I have and my supply house has been able to get close enough that I prefer to give them my business.

FRANK

I do the exact same thing and it has worked well for me.

My situation may be unique since this state has no licensing.

I met the HD guy on a job a few months ago when I was upgrading a service while he was installing a kitchen. He's actually an independant finish carpenter that is somehow contracted with the local HD. He works off a pricing sheet from HD which he showed me. Cabinet x" by x" and what they pay him is on it. He says sometimes its low but usually he makes good money on the installs. He had a similar sheet for electric work and he told me he really didn't like doing it.

I now have 5 kitchen jobs going with him. A couple of them are pretty high dollar. He's letting me contract direct with the HO to save them money. He told me that if I wanted to do this for HD they would mark up my bid plus it might take awhile to get paid.

I have been pricing these jobs agressivelly since I have to drop what I'm doing and arrange my schedule around his install date. However, its worked out well for both of us.

Again, my situation might be unique.

 

[kwired]

I do the exact same thing and it has worked well for me.

My situation may be unique since this state has no licensing.

I met the HD guy on a job a few months ago when I was upgrading a service while he was installing a kitchen. He's actually an independant finish carpenter that is somehow contracted with the local HD. He works off a pricing sheet from HD which he showed me. Cabinet x" by x" and what they pay him is on it. He says sometimes its low but usually he makes good money on the installs. He had a similar sheet for electric work and he told me he really didn't like doing it.

I now have 5 kitchen jobs going with him. A couple of them are pretty high dollar. He's letting me contract direct with the HO to save them money. He told me that if I wanted to do this for HD they would mark up my bid plus it might take awhile to get paid.

I have been pricing these jobs agressivelly since I have to drop what I'm doing and arrange my schedule around his install date. However, its worked out well for both of us.

Again, my situation might be unique.

Another thing I hate about doing small residential projects. Homeowners seem to think you have nothing to do but wait for them to call you with their project. And they don't understand that if you don't do their job it will not kill your profits for the whole year. I'm going to price it for what works for me. If that is not good enough, then I don't need the job. Even if work is slow at the time.

 

[readydave8]

Sears used to do the same as HD is doing now, I beleive up to and including building a house.

Many large builders have a set price for electrical, if one electrician won't do it for that price, another one will.

 

[readydave8]

Another thing I hate about doing small residential projects. Homeowners seem to think you have nothing to do but wait for them to call you with their project. And they don't understand that if you don't do their job it will not kill your profits for the whole year. I'm going to price it for what works for me. If that is not good enough, then I don't need the job. Even if work is slow at the time.

I always say that I can meet any schedule. Just tell me what you want done and a completion date.

The problem is that HO doesn't have a schedule, by the time we get to trimout he is so frustrated at trades prolonging job and not showing up that he won't give me lead time, just wants it done now.

Or even worse calls me every week, "Went slower than we thought" or "sheetrocker didn't show up" or "painters not done", but says he'll be ready next week. I've seen this go on for months before its actually ready.

 

[goldstar]

See if you can get a copy of the estimate HD put out indicating what the electrical work was to be and how much it was for. Unless they're using an independent EC or someone elses license # they have to show that # on all correspondence. If it's not on there, contracting electrical work with the public without a license and a business permit in NJ it's a 4th degree felony and a $1K fine first offense. If you make a copy of the estimate you can send it down to the Licensing Board and file a complaint.

BTW, if you do that make sure YOUR license # is on your stationary.

 

[Electrical Student]

I was on a job in which a painter was also there. His helper ran over to the orange store to get paint and he had also grabed a bunch of wooden paint mixing sticks. They dident use them but left them all over the house with the H.D. advertisments printed on them...

 

[LarryFine]

BTW, if you do that make sure YOUR license # is on your stationary.

Stationery, but who's counting?