Why Would They Do This

[aline]

I wish someone could explain to me why electrical contractors will do service calls at a loss.

I went on a service call today where the homeowner said she had a light fixture that was hanging from the ceiling by the wires. I figured it was a surface mount fixture and probably just needed to be reattached to the ceiling.

When I get there I find a can light that has a baffle trim with the lamp holder built into it. The trim is damaged and needs to be replaced. This is not something I carry on my truck so I would have to run and pick one up.

There's construction going on in this area and it's not very close to anything. I took me a 1/2-hour to drive out and I figured it would take at least an hour to go get the parts, another hour to install the parts, clean up and invoice the customer. With another 1/2-hour to drive back to the shop I would have a minimum of 2-hours into this job.

I gave her a price of $245 to make the repair. She was not happy and wanted to know how much was material and how much I charged per hour. I explained to her about how expensive it is to even send an electrician out and about all the other overhead expenses we have.

She asked me if I would mind if she called someone out of the phone book to check my price. I said sure. I don't mind. I expected her to get an hourly rate of $85 per hour or some type of price comparable to mine.

She calls a company that has an ad on the next page from mine that advertises free phone estimates. He asked her for the part number from the trim and after a little while he then tells her it would be $75 and that includes both parts and labor.

I couldn't believe it! I would have thought she was lying but I could here the guy over the phone. At the time I didn't know how much the part would be but I had figured on charging her $45 for the trim so my labor was going to be $200.

How do you justify your price when a legitimate electrical contractor with an ad next to yours qoutes such a rediculous price. They can't possibly make money doing this job for this price. I explained this to her but she didn't care and I doubt she believed me.

If these contractors are going to do service calls for such rediculous low prices why do they even bother. I wish they would just tell people we don't do small jobs. These guys advertise they have bucket trucks, radio dispatched trucks and no job is too small. I don't know how long they've been in business but I know it's been more than 10years. I see their trucks around quite a bit.

After I got back to the office I did a search for the trim that needed replaced.
This is a link to it. The trim cost $34. http://www.csnlighting.com/asp/show_detail.asp?sku=TL3067&refid=FR19-TL3067#ManuDetails

I appoligize for the rant but I was pretty ticked of about this and needed to vent. I would expect a price like this from a hack but not a legitimate contractor advertising next to me in the phone book. It's no wonder I have such a hard time booking service calls. My dispatch fee is almost as much as they're quoting for labor to come out and do a service call. I'm really discouraged right now about the electrical service business.

 

[got_nailed]

If you would have had the right part on the truck how much would you have charged?

It looks like with that phone call was based off having the right part in hand when they showed up to the house.

Most of your time was not spent at the house it was on the road. You should have told her that if she would have given you the needed part numbers that your price would have been close to what the other estimate was. I hope I?m right on this.

But since this is an apple to oranges issue then what is the issue?

 

[emahler]

wish i had a better answer than "i know exactly how you feel"

maybe lack of knowledge...maybe ignorance....probably both...

 

[dezwitinc]

I wouldn't be at all surprised if your customer ended up spending alot more than $245.
We have a couple of people around here that always seem to find a bad breaker, an outlet that "will burn your house down", a GFI that "might allow you to be electrocuted", etc.
It's a case of them getting their Kleins in the house and then "finding" all these other potential problems.
I would almost bet that when they got to the house, that part # that you gave them is no longer made so they upsold a new fixture and the wiring was probably too short and so forth.
Don't feel bad, just move on to the next one.

 

[ceknight]

I went on a service call today where the homeowner said she had a light fixture that was hanging from the ceiling by the wires....

...and if she had called someone else out of the phone book with that description, she might very well have gotten the same approximate price that you gave her.

The difference is you went out and diagnosed the problem, the other company she called was only asked about repairing the problem after it was diagnosed and after she had a part number in hand.

The service call and diagnostic, as well as the not knowing ahead of time that you needed a special trim, accounts for the difference in price. If you explain it to the customer that way, chances are decent s/he'll understand.

I hope you gave her a bill for the service call. $170 sounds just about right.

 

[masterinbama]

the upselling of

the upselling of

services is not as bad as billing for nothing. A very good customer of mine called one of the "chain" contractors recently because all the power in her den went out. Serviceman was there for 2 hours trying to locate the problem.
Couldn't find it. When I got back to town my answering machine was full from her attempts to reach me. Went out the next morning and fixed the problem in 5 minutes. It was a bad low voltage switch in the detached garage.If he had taken the switches apart in the den he would have noticed the leads marked "from garage". I bypassed the switch and everything worked. He charged her $350 to do nothing I put everything back together and told her to have a nice day. On a lighter note she got her money back and mailed it to me (I didn't even ask for it but she insisted). Now she jokeingly tells her friends it only cost her $350 to get my personal cell number

 

[celtic]

I went on a service call today where the homeowner said she had a light fixture that was hanging from the ceiling by the wires.

The trim is damaged and needs to be replaced. This is not something I carry on my truck so I would have to run and pick one up.

I gave her a price of $245 to make the repair.

She calls a company ...He asked her for the part number from the trim and ...tells her it would be $75 and that includes both parts and labor.

Why didn't you ask about the fixture in advance?

Not to kick you when you are down, but that seems like the main issue here.
The other guy asked the right questions and sank your battleship.

Now he has one foot in the door, and the other firmly planted on your seat.


JMO, don't take it personally.

 

[JohnConnolly]

Why didn't you ask about the fixture in advance?


.

It is likely that she had NO clue what type of fixture it was or how the components assembled.

He diagnosed it and she got a better price. It happens. Learn from it and move on.


The 75 bucks for labor AND material does seem a little low though huh?

 

[aline]

Just for fun I decide to call these guys up and tell them I have a switch I broke when I was moving furniture. I was curious to see about what they would charge for a service call that's pretty much all labor. The first call I get an answering machine. I wait a 1/2 hour and call back.

The guy tells me if it's just a switch I should probably just replace it myself.
I told him I would rather not.

He kind of stammers a bit and tells me it would be the cost of a trip charge plus the parts. I ask him how much the trip charge is. He says $85 and the switch would be about a $1. He's seems to be kind of nervous about telling me it's going to be $86 and tells me he might be able to knock some off that price. He says he has guys off hunting and doesn't have any one out running around right now but if he did he could do it for less. He said it would probably have to wait until monday. He didn't seem to enthused about comming out to replace a switch.

This price is a lot more than the $75 price they quoted to repair the can light. This company is owned by two people so the guy that quoted the price for the can light repair may not have been the same guy that quoted me the switch replacement. I know it didn't look good that I'm standing there with a price of $245 in writing and the guy on the phone is telling her it will be $75. I'm sure she thinks I was trying to rip her off.

I'm thinking about calling them back and level with them that I'm an EC and question them about this. I'd really like them to explain to me why they quoted a price of $75 to repair a can light and how could they possibly make money on this when the trim I'm standing there holding cost $34. My guess is they're just throwing out numbers over the phone and when they get out there the price changes. I wonder if I would get a different price for changing out a switch each time I called.

This house is only a couple of years old so there's not that much you would be able to find to raise the price.

This is why I don't like to quote prices over the phone and instead charge a dispatch fee to come out, look at the job and then give a firm price in writing.
Prices over the phone usually don't mean much. I'm just not buying it that these guys are going to fix her can light for $75. I'd really like to know how much this really ends up costing her.

A minimum serice call for me would be $135 even if they lived next door.

Supprisingly, after I had collected my dispatch fee and was getting ready to leave, she asked me if I would give her a bid to run power out to a gazebo and install some landscape lighting. She said but of course we're going to get other bids so we can get the cheapest price.

I don't think I want to waste my time giving her a price for this.

 

[aline]

Why didn't you ask about the fixture in advance?

Not to kick you when you are down, but that seems like the main issue here.
The other guy asked the right questions and sank your battleship.

Now he has one foot in the door, and the other firmly planted on your seat.


JMO, don't take it personally.

I didn't take the call when it came in. The workorder just said she had a light fixture that fell from the ceiling and was hanging by the wires. I just assumed it was a surface mount fixture that came loose and needed to be reattached. Even so I've tried getting more information from customer's in the past but still find the situation completely different than what I pictured from there description.

 

[celtic]

It is likely that she had NO clue what type of fixture it was or how the components assembled.

He diagnosed it and she got a better price.

She asked me if I would mind if she called someone out of the phone book to check my price. I said sure. I don't mind. I expected her to get an hourly rate of $85 per hour or some type of price comparable to mine.

She calls a company that has an ad on the next page from mine that advertises free phone estimates. He asked her for the part number from the trim and after a little while he then tells her it would be $75 and that includes both parts and labor.

I didn't see where he told her anything about the type of fixture?

Aline?
Did you tell this other contractor via the HO what the model number was?
::wagging finger::

j/k

The 75 bucks for labor AND material does seem a little low though huh?

I agree it does seem low...especially for a $35 part ...TOO low....$40? for a minimum 1 hour drive and 1/2 hr labor?

Some guys are like that...once they get their foot in your door they try and sell other things - power-save 1200 ...and point out various electrical "hazards" they percieve to be money makers

 

[aline]

The 75 bucks for labor AND material does seem a little low though huh?

I'd say a little low considering the trim cost $34 and they quoted a total price of $75 for the whole job.

 

[celtic]

I didn't take the call when it came in. The workorder just said she had a light fixture that fell from the ceiling and was hanging by the wires. I just assumed it was a surface mount fixture that came loose and needed to be reattached. Even so I've tried getting more information from customer's in the past but still find the situation completely different than what I pictured from there description.

FWIW...I'd a done the same as you did - drive out there and get kicked in the jimmy

 

[aline]

Aline?
Did you tell this other contractor via the HO what the model number was?
::wagging finger::

No. I was holding the part in my hand while she was on the phone with the other contractor. When he asked about the part number she asked me to hand her the part and she read it to him from the trim. I don't think he looked the part up. He probably thought it was a cheap baffle trim. I knew the trim wasn't going to be cheap and figured it would cost me around $30.

 

[celtic]

Just for fun I decide to call these guys up ....

You might have spoken to the dim-witted brother-in-law/secratary (sp?) or some shoppie that happened to pick up the phone while the owners were out hunting and having fun...

...and he figured he could "suppliment" his income doing "sidework" in the company truck.

Happens all the time.

 

[aline]

If you would have had the right part on the truck how much would you have charged?

Based on me thinking the part would cost me $30 I would have charged $195 if I had it on the truck.

Still I would probably consider this too low because I would more than likely have to go to the supply house and pick this up on the way unless I happened to have this on my truck. Not very likely though since I don't carry a lot of parts for recessed cans. I had a couple of 5in. cans on my truck and some baffle trims but this was a 4in. can.

 

[aline]

I'm just dissapointed in how little electrical contractors feel they're worth.

I won't do a service call for less than $135 and I feel that's too low. Yet there are plenty of contractors in my area that charge less than a hundred dollars for a service call.

Best Buy charges a minimum of $135 to come out and look at you computer even if all they do is plug it in. I guess the Geek Squad is worth more than us.

I don't know why we think we need to go out and do this type of work at a loss because we're afraid we might make the customer upset if we charge enough to make a profit.

The customer thinks we're charging too much no matter how low our price is so if I'm going to have an upset customer I'd rather have an upset customer and also make a profit.

When I told the customer we'd be lucky if we made $20 profit on this $245 job she didn't believe me. She said if the part is $45 that would leave $200 how could you not be making more profit than that. (Sigh) This sounds like a lot of electrical contractors way of thinking.

 

[aline]

I hope you gave her a bill for the service call. $170 sounds just about right.

No. I have a dispatch fee to go out and look at the job. Then I give them an upfront price in writing for the costs of the repairs. Currently my dispatch fee is $29. I know others in my area, that operate this way, are charging any where from $29 to $49 for a dispatch fee. If the customer doesn't accept the price for the repairs all they pay is the dispatch fee. The dispatch fee doesn't include diagnosing wiring problems but there wasn't any diagnosis involved in this case so I only collected the $29.

I never give a price for anything that's less than $135. I've tried telling people over the phone that it will be a minimum of $135 to come out but never got any work because they'll call the next guy in the phone book who will tell them it's $75 for the whole job or else they'll quote an hourly rate of $65 to $85 per hour and the customer thinks it's only going to take an hour so they're figuring it's going to be $65 or $85 to have the work done.

This is why I just quote the dispatch fee and make sure that they understand that this fee is just a trip charge to come out and we will give them a firm price after looking at the job. This way if the job is a lot more than what they had counted on or if they can't afford to have the work done they're only out the dispatch fee and they're not committed to having the work done.

 

[cowboyjwc]

I agree with dezwitinc, most of those companies work on bait and switch. Get in the door and then it's always something else.

"It's a good thing you called us. I don't know who installed that fixture, but we got here just in time. We're going to have to completely rewire it back to the switch and I'm not sure if the panel is going to be able to take the load of the additional BS that I'm going to feed you". :grin:

 

[aline]

I agree with dezwitinc, most of those companies work on bait and switch. Get in the door and then it's always something else.

"It's a good thing you called us. I don't know who installed that fixture, but we got here just in time. We're going to have to completely rewire it back to the switch and I'm not sure if the panel is going to be able to take the load of the additional BS that I'm going to feed you". :grin:

I personally think that most of these companies do these little jobs at a loss figuring they have to and it's just part of being in business. And if they do these little jobs at a loss then the customer is going to call them when they need a bigger job done. I think they feel somewhat obligated to do these jobs and don't want to say no even though they know they won't make any money on them.

I think they figure small jobs are just another business expense like giving free estimates and advertising and as long as they show an overall profit at the end of the year they don't worry about it.

I really don't believe there are that many companies out there that try to pull a bait and switch or try to sell more work while there. Most seem to want to just get this pain in the neck small job done and get out of there so they can get back to their larger projects. I'm sure there are some out there but I think that number is very low for legitimate electrical contractors.

It can be pretty easy to take advantage of customers. I don't know how many times I go out on a call where they tell me the ballast are bad in their light fixture because they just put new lamps in and it still doesn't work.

I'll get up there and look and see one of the lamp pins on the outside of the socket. I'll reinstall the lamps and they're amazed that it works. I could easily sell a lot of ballast replacements from these situations because they're already convinced it's the ballast. In some cases it's a commercial customer and no one is around to even see what I did to get it to work. I could have just told them I replaced the ballast without actually doing it. I've left many jobs where I could have easily took advantage of a customer and walked away with a lot more money but didn't.

I think most contractors doing these jobs at a loss know they lose money on these jobs but are afraid the customer will think they're a crook if they charge too much and will tell everyone. They're afraid they'll get a reputation for being an overpriced rip off company so they keep the prices for these small jobs low.