Wow some people have nerve

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I just priced a job for a homeowner. My total quoted price came to $1910 and I also had a separate price in there for a new GFCI receptacle to be pulled off of the panel.

I got an email from him yesterday saying it broke his budget and what could I do to try and get it closer to $1500. I made some suggestions for things we could delete.

I got an email from him this morning that read, in part, "You do the job as you listed for $1850 and throw in for free the GFI outlet by the stairs".

I can understand trying to haggle and seeing if I'll bite on a lower price but I really think it takes nerve to offer me a lower price and on top of that ask me to throw in something for free. What am I a car dealer? Do you want the undercoating with that? How about this I'll throw in the clear coat on the paint for $99.95?

Sheesh.
 

mcclary's electrical

Senior Member
Location
VA
I just priced a job for a homeowner. My total quoted price came to $1910 and I also had a separate price in there for a new GFCI receptacle to be pulled off of the panel.

I got an email from him yesterday saying it broke his budget and what could I do to try and get it closer to $1500. I made some suggestions for things we could delete.

I got an email from him this morning that read, in part, "You do the job as you listed for $1850 and throw in for free the GFI outlet by the stairs".

I can understand trying to haggle and seeing if I'll bite on a lower price but I really think it takes nerve to offer me a lower price and on top of that ask me to throw in something for free. What am I a car dealer? Do you want the undercoating with that? How about this I'll throw in the clear coat on the paint for $99.95?

Sheesh.



Know your break even price. Don't budge. Tell him to get somebody else. Often, if I knowI'm dealing with a "haggler",,,,the quote gets a few hundred extra from the start. Then, if they haggle, you can shed a bit and still make out. If his proposal puts you below your bottom line, don't do it.


$0(profit) x 0 (jobs) =$0
$0(profit) X 30 (jobs) =$0,,,,,same boat,,,,,but with worn out body,vehicle and tires
 

satcom

Senior Member
I just priced a job for a homeowner. My total quoted price came to $1910 and I also had a separate price in there for a new GFCI receptacle to be pulled off of the panel.

I got an email from him yesterday saying it broke his budget and what could I do to try and get it closer to $1500. I made some suggestions for things we could delete.

I got an email from him this morning that read, in part, "You do the job as you listed for $1850 and throw in for free the GFI outlet by the stairs".

I can understand trying to haggle and seeing if I'll bite on a lower price but I really think it takes nerve to offer me a lower price and on top of that ask me to throw in something for free. What am I a car dealer? Do you want the undercoating with that? How about this I'll throw in the clear coat on the paint for $99.95?

Sheesh.
Send him a nice E Mail

Dear Mr Homeowner

Thank you so much for asking me to review my pricing, in the process of the review I discovered a serious mistake in my estimate and the installation total was 2,250 not 1,910, thank you again for asking me to look at my price, I hope you are able to find someone to help you meet your budget,

Thank you

We were asked to review a job and this was what happened to us, the price was actually higher.
 

Dennis Alwon

Moderator
Staff member
Location
Chapel Hill, NC
Occupation
Electrical Contractor
You probably could use the job. Send an email and say I'll do it for $1850 but they need to pay for the GFCI. See what happens. You come part way-- if they don't bite- let it go.
 

480sparky

Senior Member
Location
Iowegia
You probably could use the job. Send an email and say I'll do it for $1850 but they need to pay for the GFCI. See what happens. You come part way-- if they don't bite- let it go.
And thus perpetuates the degrading cycle of constantly lowering our prices. I'm running a business, not a garage sale.

Such strategies don't work at the gas station or the grocery store. Try demanding that the gas station sell you gas for $2.25/gal, or 50? for a loaf of bread.

All this will do is continue to train people that we're somehow overpriced to begin with.





What I would do is send them the 4-page list I have posted, asking them to find a half dozen line items where they can prove to me I can save enough to justify lowering my price for their benefit.
 

Dennis Alwon

Moderator
Staff member
Location
Chapel Hill, NC
Occupation
Electrical Contractor
Ken, you do what you have to do. I use to get upset with it but I do the same thing when I buy a car or buy materials. The economy sucks and people are wanting a deal. Let them feel good. $60.00 ain't going to break anybody.

If you can't deal with it then turn it down and sit at home. Quite frankly I'd rather work and make a bit less then not have any income at all. It sucks but that is the way it is.
 

480sparky

Senior Member
Location
Iowegia
I understand that, Dennis, but I guess I've taken the opposite stance.

Grocery prices haven't fallen through the floor because of the economy because grocery stores are businesses that need to pay their bills.

The only difference between a grocery store and my business is the end product the customer gets. I still need to pay my bills, and lowing my prices won't cut it.

Far too many people these days are merrily playing the 'poor economy' card, hoping someone is willing to sell themselves short. There's only one person who can possibly benefit from this.......... the customer.

My business model is to put money in my bank account, not the customers'. What the customer gets out of the deal is a great experience, a quality product, and a safe installation.

I apologize if this sounds harsh, and I won't fault anyone for dropping their pants at the customer's demands, but it will only come back to bite everyone in the future.
 

satcom

Senior Member
Ken, you do what you have to do. I use to get upset with it but I do the same thing when I buy a car or buy materials. The economy sucks and people are wanting a deal. Let them feel good. $60.00 ain't going to break anybody.

If you can't deal with it then turn it down and sit at home. Quite frankly I'd rather work and make a bit less then not have any income at all. It sucks but that is the way it is.
Sure it's common for a customer to look for a good price, and we always try to offer a good price for jobs, however we will never cross the line of going below our cost, and jobs in the current market conditions are very close to the cost figure, not much to deal with.

As was noted, just see how far you get asking any of your suppliers or vendors for a break, it just will not happen, they are in business and know their costs.
 

Dennis Alwon

Moderator
Staff member
Location
Chapel Hill, NC
Occupation
Electrical Contractor
I am sure your customer gets a great quality job. I have no doubt. Again I can make $100 or I can stay at home. I have had to cut my hourly wage for my 2 men at times but I do what I have to to keep the truck rolling. I am not cheap by any stretch of the imagination but I have had to lower prices a bit at times. I will not turn down a $2,000.00 for $60.00.

I hate that the customer gets one over on us but hopefully I can get it back with changes etc. If not, at least I am working and pulling in some bucks. When the economy was strong we named our price and got it. Things are different now.

Someone moved my cheese and I need to look elsewhere to survive.
 

Dennis Alwon

Moderator
Staff member
Location
Chapel Hill, NC
Occupation
Electrical Contractor
Sure it's common for a customer to look for a good price, and we always try to offer a good price for jobs, however we will never cross the line of going below our cost, and jobs in the current market conditions are very close to the cost figure, not much to deal with.
Who said to go below our cost. Of course not but if $60.00 is all the profit you had in that job then you are not making any money anyway. I would never work below cost.
 

satcom

Senior Member
Who said to go below our cost. Of course not but if $60.00 is all the profit you had in that job then you are not making any money anyway. I would never work below cost.
Yes on a $2000 job in good times we were getting around 7% now we are closer to 3% which is exactly $60 on a 2K job but in the case of the OP the customer wants him to go below his cost.
 

Dennis Alwon

Moderator
Staff member
Location
Chapel Hill, NC
Occupation
Electrical Contractor
Yes on a $2000 job in good times we were getting around 7% now we are closer to 3% which is exactly $60 on a 2K job but in the case of the OP the customer wants him to go below his cost.
The OP is okay and stated that he can do it for $1850. I did not see the OP stating it was below his cost.

I don't see how you can bid a $2000 job and make $60 and call that making money. I better be making between 10% to 20% on a job that small or I probably will not do it.
 
Do not lower the price, give the customer a discount!! The price is the price, and you can choose to accept less, but if it's a $1950 job, it's a $1950 job. If you don't mind doing it for $500, that doesn't change the value of the work. Are they paying with a credit card? You could offer a cash discount, too.

I'd say something like this: "Dear Mr Customer, if the work is performed by Friday June XXX, I can give you a 5% discount on this job. This reduces the total to $xxx."

You've told them that they have to do something to get the lower payment (have the work done soon), the word "discount" establishes that it's coming off the regular price, and "on this job" tells them that this is not a regular reduction. Together they say that you're not changing the price, but will accept less payment this one time.
 

krisinjersey

Senior Member
Discount

Discount

I think the discount is definetly the smart move. Discount for completion by date X or cash payment, senior discount if it applies, coupon for a percentage off on future work upto a specified amount, refferal discount. There are a hundred ways to play it, but as long as they think they're getting something for free or for less they get that inconsequential victory. We get paid what we get paid because we're highly skilled labor. I wouldn't cut the original price.
 

laketime

Senior Member
Yes on a $2000 job in good times we were getting around 7% now we are closer to 3% which is exactly $60 on a 2K job but in the case of the OP the customer wants him to go below his cost.
If you are only getting 7% in good times and 3% now you need to come up with a different business model I would think. At 3% you would only make a profit of $30,000 on $1Mil of work.
 

satcom

Senior Member
If you are only getting 7% in good times and 3% now you need to come up with a different business model I would think. At 3% you would only make a profit of $30,000 on $1Mil of work.
Do some checking, and you will see if your doing 7% on labor profit and 30% on material profits year end, you are way above average.
 

Dennis Alwon

Moderator
Staff member
Location
Chapel Hill, NC
Occupation
Electrical Contractor
Do some checking, and you will see if your doing 7% on labor profit and 30% on material profits year end, you are way above average.
The problem is you never mentioned the 30% on material until now. When I look at profit I look at the entire profit. 7% is nothing for a job but when you add 30% markup on materials then that changes things.
 
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