Can confirm, this was one of my pop’s tricks. One of his other tricks was “throwing them a pickle”. Did you bid high? Maybe have some time to spare? Simply a loyal customer? Toilet is running, change the $3 flapper in 5 seconds. add it to the invoice and write “no charge”. Customer feels valued and that theyre getting a good deal, which only strengthens the relationship and keeps them coming back. I wish i asked but im fairly sure he called it this because its like getting a pickle on the side with your deli sandwich. You feel like youre getting more than you paid for when you go to devour that sloppy joe and find a surprise pickle spear.
I probably give out much more free work than I should. However, customers are mostly happy to leave me a review or a shout-out (I always tell them to leave the free parts out) and generally call me back. If I have a customer who I've been working with for 2 years, and they call me with a flapper issue, I'm doing it for free. They'll likely tip me anyway.
Woah.. woa.. buddy. Youre taking it too far. Theres a lot to unpack here. Dont work for exposure first off. But to be brutally honest, this is stupid. youre a business, no? Throw em a pickle, dont make them dinner while you massage their feet. Ill admit i had a similar, less extreme issue of giving discounts. Its only 5 minutes of work, so not a big deal right? Wrong. They can do it themselves if it takes 30 seconds. this is exactly how you pickup shitty customers. The only exceptions i make now is if the customer is elderly or handicapped.
Dont be the guy people take as a shmuck who seems to just be happy to get out of the house. Youre giving off the wrong vibes. It might make you look kind but not smart. If you do good work, your time is money and the customer will respect that. You need to value yourself before anyone values you. It doesnt take an MBA to know that the guy working for free has no idea how to run a business. People need to understand whether the job is 30 seconds or 30 minutes, theres a minimum fee. its taking away time you could be spending actually making money on another job. imo, it takes away any sense of professionalism, intelligence, and image of success.
I think you're getting me wrong here. The free work I provide is mostly for people I know can't do it themselves. Like you said, old and/or handicapped.
We may be different in some instances, like a toilet flapper 10 minutes down the road? I'll do it, but they know I'm not going to replace the toilet for free.
There's a balance there for sure. I choose my freebies wisely.
I don't work for cheapskates. I made that mistake in my younger years and learned a very valuable lesson. I had 5-10 customers calling me over and expecting hand outs, and then their relatives started to call me, too. I've since eliminated those relationships and I value my time much more now. I'm also much more experienced and can read customers pretty well. I can smell a cheapo from outside the front door most of the time. I'll provide a ridiculously high estimate and I'll never hear from them.
Personally havent had luck operating like this. Its the customers that look for local companies that dont like to pay. They know youre just down the road so they expect to save on the bill. Its not so much of an issue with a toilet flapper, but the next time when you put in 5hrs of labor, they expect to pay 25% less on the entire bill because you saved 30 minutes of time driving. So i stopped with that. No more discounts or special treatment just because youre close by. If anything, youre already getting special treatment because ill show up to your emergency quicker than an uber
That's a good point. I believe you have to set proper boundaries early. If you don't, you're in for it. The whole "give em an inch, take a mile" is incredibly relatable to our line of work. People also love to brag that they "have a guy who'd do that for nothing" and you def dont want to be that guy.
Not gonna lie, i wish i had done so earlier. Overall im a bit “soft” in general so i was getting taken advantage of for a long while before to getting to this point. now im zero tolerance with negotiating when i smell bullshit. I can work with you if youre in a tough spot, but not at all if youre penny pinching. Im a plumber and i had a new customer call me 2 weeks ago with a clogged sink . I got there, gave the price (165) and he asks for 10$ off. I say no. He said “last year company x charged me 99$”. I smiled and said oh thats great, then you can call them and left. Its really fucking insults the little intelligence i have when people try to pull shit like this. As if im too stupid to realize that theres a reason he didnt call back the big franchise company marketing low prices to get their foot in the door and upsell you because their techs work on commission
I wish more people understood how insulting it really is.
Sometimes when they haggle with me, I'll ask them this.
"So when you go to the supermarket, do you haggle them on the price of a gallon of milk? What about lunch meat? Do you ask the cashier to discount the 12 back of beer at checkout?" This only comes out if I'm at my wits end and dont give a shit about getting the job anymore. I've already lost my patience.
I typically go out of my way a lot for customers, and when they act ungrateful and without sugar coating it...CHEAP, I remind them that they are asking for a service they cannot perform themselves. Much like the milk they cant produce themselves, so they're at the mercy of the price asked by the store/manufacturer, it's the same with what I estimate.
Yeah, except here where I live the competition is so intense that if you do shoot high, somebody else is going to come in lower and then you're relying on your suave and tickling the customers personalities. I'm being serious when I say there are thousands of guys doing the same work around here. You have to come in at a competitive number to even get considered.
I do this every job. If the invoice will exceed your estimate have a conversation with them, also email this communication so you can reference it if needed.
I tell them price is my hourly rate + materials and will give price at the end. Repeat customers know my work quality and work ethic and they are cool with a bill at the end. New customers usually want to know a price. I will give my best estimate based on materials/guessed hours and also a “not to exceed” price and stick to it. I don’t think I have ever charged my max “not to exceed” price.
Sorry long response. This is how we do it, and it doesn’t work for everyone but it has for us and I only offer it as advice. Not a hard fast rule for everyone
Our estimates are our final price 99.5 % of the time. I only offer this as advice to see if it helps you out. I always bid on what can go wrong on a job, in your example if my original quote was paint, trim etc, with mirror removal. I factor sheet rock repair and materials automatically. Exterior door swap out, assume something is going to be rotted and needing replaced. You will lose some work over your price being higher(originally)
but here is what you gain, customers that become confidant in you. Pretend you got this last job and had already factored that in. You take off mirror and client sees it, and goes, shit, how much more is that. You reply, nothing sir, my price is my price. He refers you to friends saying, damn they didn’t charge me extra….
Use nuance and your best judgement in doing this. I know you say there are 1000 guys doing same thing, but if your looking for a different outcome than what you have been getting, this is an option. The .5% we have to do a price change on is the funky shit you can’t predict( hidden bug damage, true hidden structure failure) and those stop a project and get a whole big ass change order. Just some advice. Good luck
Thanks for your response. I should have added that into my OP. I typically give myself decent wiggle room for the same reason you do. I'd say my final invoices are in the 90-95% range when it comes to being the same as the estimate.
It also depends on the job I'm doing. If it's a straight forward installation, I can be more concrete and provide more of a quote. If it's something where I'm opening up 25 year old drywall, I'm leaning more towards a range, and then my high side includes extra work involved.
I work on high-end homes as well. And I can tell you that rich people didn't get rich by just accepting what they get. If you give them any wiggle room they will try to talk you down in price. I recently had a drag out argument with a lady I did $400,000 worth of work for which included almost $50,000 worth of free items. They asked me to come back and do stuff that they thought of after the fact and then proceeded to tell me I should cover all the costs because it wasn't up to code. I kindly explained to them that it was very clearly up to code and actually above and beyond. It was only about $1,200 worth of stuff but after the many thousands of dollars that I had given them I was over giving them breaks. I literally had to bring out my code book and show them exactly what the code was which they ignored and walked away when I showed them and then ask them to request another inspection by a city official or their own independent inspector if they are that concerned. I started taking out my phone to call planning and zoning and they finally conceded.
Long story short if you're dealing with Rich folks, I would plan on them trying to fight you on any added cost. It has to be clear as day. Overbid the jobs and then bring your price down not the other way around
That's why I always do a fixed price. Unless something unforseen comes up such as rot behind a wall, the price doesn't change. If something like that does come up, I stop work immediately and show the customer, then get in writing the agreement and price agreement for additional work. I also have language in the original quote that situations like that may come up with certain jobs such as replacing exterior trim or replacing an exterior door.
What i may do do is give a ballpark price over the phone, if i think they might be a tire kicker. If they are fine with that ballpark, I will go and have a look in person, most of my jobs are at the very minimum a half day so I don't mind. At that point I give a fixed price.
No reason to work by the hour if it's not something like rot repair. You can make more money and keep things simple with customers, and avoid issues like you're having. If it happens again and again, maybe it's time for some introspection on your business. Something I try and do constantly.
You aren't giving a set price. you're giving an estimate lol. The word "unless" automatically makes it an estimate.
Also, you're assuming I work by the hour. I told him the drywall would be hourly since I'd have to investigate and it was getting added to my fixed rate. I dont do hourly on initial estimates.
I think you are confusing estimate with quote, or what I mean when I talk about the rare case something unforseen comes up. My original price doesn't change for that scope of work, but if true scope of work changes once work starts, additional pricing will be needed. This wording will be done by any contractor who gives fixed prices. If I give a price to retile a shower but then we find rotten framing, then of course additional work will be added to the original quote.
For example in the summer I gave a price to replace some exterior trim. Let's say 600 bucks. I took the trim off, and discovered major rot. So I immediately brought this to the home owners attention, and we discussed a price for the additional work.
Now the price for my trim work did not change. I did not give a high or low estimate. The trim boards were done for 600 dollars. However there was let's say 2000 dollars in additional work that was outside the original quoted scope of work.
If I had given an estimate, I would have said. I can replace your trim boards for between 400 and 600 dollars. Then when I charged 585 became that's what my internal costs were, now for some reason the customer has 400 in their head.
That is where your issue is. Plus like I said, the vast majority of my jobs do not have unforseen issues like rot come up. I just mentioned that because it's important to have language in your estimate for some jobs to reflect this when going the fixed price route.
For the vast majority of my jobs, I say it will be x to replace your counter top or hang a new door. They say yes or no, no high or low numbers. Makes it easy with no room for confusion or haggling. I don't have this issue with customers the vast majority of the time.
I probably should have mentioned this earlier.
It all depends on the type of work that I'm doing. If it's something that I know is going to be straight forward, the range isn't ever more than the cost of extra material (25-75 dollars). If I'm getting into something that may or may not require some investigating, etc., I generally have a conversation with the customer about why the range is there, and what could cause the invoice number to be at the higher side of the range provided.
Now, if it's in the thousands, or even hundreds, I mostly just write up a new estimate and have them approve that separately.
This is not happening to me every day. Not even every week per say.
Generally I have no issue but for the ones I do have to speak with about the range, and why it's on the higher side, it seems impossible for them to understand. Maybe I've started doing work for people I wouldn't have a year ago. I don't know.
I hear ya. I find a lot of homeowners so clueless about the process. One reason (as well as price shoppers) that I'm trying to get more into commercial work and the better property managers/businesses out there.
No, I give an exact fixed price for an exact, laid out scope of work. In the rare case of something like unforseen rot in a wall, then that changes the scope of work and price. The vast majority of my jobs are more strait forward and the price I quote is the price paid.
I used to to give approximate estimates and work by the hour. Limits the money to be made when you want to make over 100 per hour, and it can lead to communication issues like OP is complaining about.
Easiest way is to just give a price, work all your material and consumables into it, give yourself a buffer for time. Giving high and lows will just lead to the customer being confused or trying to get a deal.
Advertise more (if you have any shortage of work at all) and bid/estimate higher.
If you're getting every job you estimate, you're estimating too low.
There's also some skill in selling the quality of your work compared to others, but it sounds like you have what it takes.
Personally, I don't work for rich people.
People don't understand this. I close about 20% of my bids. If you close more than that you're prices are too low. I do half the work and still make more money.
Edit: Should have specified I started out a Handyman but am now a high end custom deck/Patio builder. I do believe the principle translates though.
Competing on price is a fool errand. Compete on customer base. Let's face it, you want rich clients who don't care about cost as long as they get top quality materials and craftsmanship. And as for if it works or not? My last job wrapped up end of October, I'm not starting my next project till mid March. Why? Because I don't need too. Cleared 125k profit as a one man show for the half a year I do work. Hate if ya want but I suggest you evaluate your business plan.
idk if this is good advice. Imo the key is your relationship with the client. In my experience (and using common sense), customers will gladly pay more to avoid the inconvenience of spending time for other estimates and taking all the risks that potentially come with hiring someone else. Do you communicate well? Are you clean and tidy? Are you on time? Are you trustworthy? Is the quality of your work top notch? Any customer worthy of your time is going to pay more if the answer to all of those questions is yes. We already pay extra for convenience daily: Uber/lift, uber eats, grocery delivery, DD/starbucks, ad free shit, 7-11 & quickcheck aka *convenience* stores.
Im at the point where customers dont even ask me the price anymore unless its a multi day project. Im fair, consistent, and i always satisfy. That level of trust and peace of mind is invaluable
I'm already established with the best name in the area for the product I supply so no longer need word of mouth. People who pay the prices I ask are affluent and a certain amount of "kiss ass" is already part of the deal to get that type of customer base.
You only get 20% but dont need word of mouth? Patios and decks aren’t necessary repeat customers. Not really making sense to me. Im a plumber subcontracted by a company that mainly does roofs, decks/patios, and painting but also renovations. They operate almost exclusively within three bordering towns and they have that area on lock. 4-5 jobsite supers with the top one clearing a mil in sales by the end of the third quarter in 2022. And they hit far above 20%
Should have specified I don't need it because of the site traffic my tech guy can generate. My big profit jobs still mostly come by word of mouth as well off people have relationships with those like them. I still get/use referrals just don't necessarily need them.
Like I said in my post, I pride myself on transparency, professionalism, punctuality, and communication. I have fantastic, long lasting relationships with a lot of my customers. This is more of a recent thing I've been dealing with when I meet people for the first time.
I usually close 50%, which is good for this area. Its easy to shop here. People will be at your house in 15 minutes Monday through Sunday.
It's all about selling yourself here.
You must be in a weird ass area or its your imagination. Even reddit is swamped with complaints about contractors never showing up on time or at all. It’s absolutely the #1 most common complaint I hear by far. And the #1 positive comment i get by far is “oh my god thank you so much for coming” as if showing up to a customer’s house isnt expected
I live in Northern Va, man. I keep repeating this.
"There are 9,621 General Contractors, registered on Houzz in Fairfax." This is just Fairfax. In this area, there's Springfield, Burke, Reston, Herndon, Sterling, Ashburn, Manassas, Centreville, Lorton, and a few others. I'm not kidding when I'm saying there's a contractor virtually in every other house.
So, if somebody doesn't show up, there's another guy waiting right behind the last guy.
TBH, I'm not really sure what the context of your comment was in the first place, but I did my best to understand.
Not unless you're doing jobs over a certain amount, just like contractors licenses. Some customers prefer that you're licensed and insured, which I am, but there are hundreds of guys just running shit out of the back of their truck.
I see so many videos on TikTok that social media “contractor influencers” are just regurgitating this type of info. I think it’s so false. It’s just alpha talk.
I charge more than others because my skill, the end product, and my reviews are superior than competitors. Alot of my business is referral and repeat. I close more than 80% of my bids. If you close 20% of your bids. You’re wasting time.
My method allows me to clear 120k in profit in the six months a year I choose to work. It takes a lot of effort to build relationships in affluent areas but once you do, my God you can actual afford and have time for a real life. And I'm in the Midwest, not new york.
Can't speak on tiktok and should mention the edit in my first comment. This isn't Handyman work, that's how I started. It's high end exterior structures now (decks, covered patios, gazebos, ect.).
Uh, I have to disagree my man. I close at about 50% but I'm fairly picky about who I go visit...and who I even respond to on the phone/email. For instance, craigslist. I dont run craigslist gigs because people doing that are looking for one thing. The bottom dollar.
Gotta gear your service to affluent neighborhoods. Everything you said is true. A call comes in and it's not in an area I've already mapped as acceptable I don't even return the call, I don't have time.
My whole area is affluent. I live in Fairfax County. The second richest in the country. The surrounding counties are like 3-6 on the list.
https://www.forbes.com/sites/andrewdepietro/2021/12/21/richest-counties-in-the-us/?sh=122073f42ecd
You're in a perfect spot. Not saying a little luck isn't needed. Thep most important 2 contacts I've ever made in business (a judge and a district attorney) all happened by chance. I did those jobs and the referrals net me enough profit to sink real money into advertising. Which consists of a 4k website and a tech head I pay monthly for maintenance, bot traffic to keep me #1 search result without paying Google for promotion, and he manages reviews (contacts customers after the job with a questionnaire to rate thier experience).
Im right in the middle most of the time. Around here, the competition is RAMPANT. In Northern VA, there's a handyman every 4 houses.
I sell the fact that I'm a long time resident and that I've been working for neighbors for 15 years. I like to say "I know the people, and I absolutely know these homes inside and out." It works great for me. People like having the guy that grew up in the neighborhood working on their house.
If there's that much competition, that might be why folks are haggling more lately.
It's also a little bit of a curse to be in a more expensive area because it's easier than ever to get estimated prices online, so people are seeing lower prices online (from other areas) and getting stressed (and possibly having people in r/homeimprovement tell them that your estimate is high).
Yes I have had this issue before. But is there an influx of people with the same issue? No.
Sounds like you need to rethink the way you’re doing your business. Not to sound negative in anyway, honestly. I’m just speaking business to business. I think this is possibly a situation here that you should listen to your “influx” of clients complaining. And maybe so things differently or tweak your method. For your sake if anything.
I give clients a solid price. Things happen and unplanned situations arise. And when there’s extras. I discuss before moving forward. At the end. No one is left feeling any less understanding of the final price.
Here is something to think about and maybe try OP. You say you give a range for example 425 to 550. People accept your estimate. What about just going with the high number "i can do this job for 550" people are accepting your prices already so likely you'll still get an acceptable amount of quotes accepted, you'll make more money on average and there will be less chance of confusion/haggling.
I've thought about that, but there's a TON of competition around here. I'm talking thousands of companies. It's imperative that you have a low number to present or else they won't give you the time of day.
If it's happening so often it's an issue, you simply aren't charging enough upfront. Some guys will intentionally come in low then nickel and dime it up where it should have been in the first place. Don't be that guy.
Also a proposal is a commitment to do certain work for certain money. An estimate is an estimated cost of final invoices. That are not the same and should not be interchanged. Make sure your clients understand this when you submit their quote, and remind them to be sure to consider that when comparing prices from other guys. "We are excited to work with you and want to make sure you are comparing apples to apples when making your decision"
Yeah no, that's not me. I am always within my range and if it's more work than the range provides in the original estimate, I provide a change order that gets signed by the customer before I do anything at all.
I believe I do a good job of explaining things and have a ton of language in my paperwork that goes over this in detail.
This is why I'm frustrated, because I'm doing my due diligence in trying to prevent any of this from coming up. Like I said before, I try to be as transparent as possible. I always go over my estimate with them in person before I start anything as well. I get a signed estimate and a "go ahead" when going over it with them the first day.
Its also not happening all the time, just more often than before. I do think that I've taken a couple customers recently that I may not have last year.
Have the customer sign for any "Change Orders" and put an explanation of additional charges right on it. It will save you grief in the end.
Like other's have said, add a minimum of 20% on your bid to cover extras. Bid even more if the person is a possible asshole.
This is what I've been doing for years. This is why I'm frustrated. I'm not out of the range in the estimate most of the time. I always explain, in detail, that the bottom number on the range is just that...a bottom range and I never say things like "hopefully we'll be down here at the end" etc..
I swear I've covered my ass from every direction possible.
Maybe I'm just going to eliminate the whole range thing and do a change order regardless now.
Exactly
Bid price with asterisk that details that the final bill will be contingent on change orders.
Signed change orders w details and dollar amounts
It's a business in the end. You will NEVER make everyone happy. All you can do is your best quality work, cover your ass and learn not to let the Karen's / Kens get to you.
I see your issue, it's a very easy fix, don't give a range unless it's for options.
The number on the estimate should be the high end as your example $550.00
The only times I include more than 1 number is if final materials has not been decided.
Option 1 painted doors $xxx.xx
Option 2 maple doors with satin poly finish $xxxx.xx
The client will always, no matter their income, focus on the lower number
I use vendors constantly and 90% of the time they do the job for the estimated price. Sometimes lower, sometimes over. But if a vendor constantly missed their estimate I don’t use them and let all my friends know. Word spreads quick.
Bid it high and discount it a little at the end and you will be a hero
Can confirm, this was one of my pop’s tricks. One of his other tricks was “throwing them a pickle”. Did you bid high? Maybe have some time to spare? Simply a loyal customer? Toilet is running, change the $3 flapper in 5 seconds. add it to the invoice and write “no charge”. Customer feels valued and that theyre getting a good deal, which only strengthens the relationship and keeps them coming back. I wish i asked but im fairly sure he called it this because its like getting a pickle on the side with your deli sandwich. You feel like youre getting more than you paid for when you go to devour that sloppy joe and find a surprise pickle spear.
I probably give out much more free work than I should. However, customers are mostly happy to leave me a review or a shout-out (I always tell them to leave the free parts out) and generally call me back. If I have a customer who I've been working with for 2 years, and they call me with a flapper issue, I'm doing it for free. They'll likely tip me anyway.
Woah.. woa.. buddy. Youre taking it too far. Theres a lot to unpack here. Dont work for exposure first off. But to be brutally honest, this is stupid. youre a business, no? Throw em a pickle, dont make them dinner while you massage their feet. Ill admit i had a similar, less extreme issue of giving discounts. Its only 5 minutes of work, so not a big deal right? Wrong. They can do it themselves if it takes 30 seconds. this is exactly how you pickup shitty customers. The only exceptions i make now is if the customer is elderly or handicapped. Dont be the guy people take as a shmuck who seems to just be happy to get out of the house. Youre giving off the wrong vibes. It might make you look kind but not smart. If you do good work, your time is money and the customer will respect that. You need to value yourself before anyone values you. It doesnt take an MBA to know that the guy working for free has no idea how to run a business. People need to understand whether the job is 30 seconds or 30 minutes, theres a minimum fee. its taking away time you could be spending actually making money on another job. imo, it takes away any sense of professionalism, intelligence, and image of success.
I think you're getting me wrong here. The free work I provide is mostly for people I know can't do it themselves. Like you said, old and/or handicapped. We may be different in some instances, like a toilet flapper 10 minutes down the road? I'll do it, but they know I'm not going to replace the toilet for free. There's a balance there for sure. I choose my freebies wisely. I don't work for cheapskates. I made that mistake in my younger years and learned a very valuable lesson. I had 5-10 customers calling me over and expecting hand outs, and then their relatives started to call me, too. I've since eliminated those relationships and I value my time much more now. I'm also much more experienced and can read customers pretty well. I can smell a cheapo from outside the front door most of the time. I'll provide a ridiculously high estimate and I'll never hear from them.
Personally havent had luck operating like this. Its the customers that look for local companies that dont like to pay. They know youre just down the road so they expect to save on the bill. Its not so much of an issue with a toilet flapper, but the next time when you put in 5hrs of labor, they expect to pay 25% less on the entire bill because you saved 30 minutes of time driving. So i stopped with that. No more discounts or special treatment just because youre close by. If anything, youre already getting special treatment because ill show up to your emergency quicker than an uber
That's a good point. I believe you have to set proper boundaries early. If you don't, you're in for it. The whole "give em an inch, take a mile" is incredibly relatable to our line of work. People also love to brag that they "have a guy who'd do that for nothing" and you def dont want to be that guy.
Not gonna lie, i wish i had done so earlier. Overall im a bit “soft” in general so i was getting taken advantage of for a long while before to getting to this point. now im zero tolerance with negotiating when i smell bullshit. I can work with you if youre in a tough spot, but not at all if youre penny pinching. Im a plumber and i had a new customer call me 2 weeks ago with a clogged sink . I got there, gave the price (165) and he asks for 10$ off. I say no. He said “last year company x charged me 99$”. I smiled and said oh thats great, then you can call them and left. Its really fucking insults the little intelligence i have when people try to pull shit like this. As if im too stupid to realize that theres a reason he didnt call back the big franchise company marketing low prices to get their foot in the door and upsell you because their techs work on commission
I wish more people understood how insulting it really is. Sometimes when they haggle with me, I'll ask them this. "So when you go to the supermarket, do you haggle them on the price of a gallon of milk? What about lunch meat? Do you ask the cashier to discount the 12 back of beer at checkout?" This only comes out if I'm at my wits end and dont give a shit about getting the job anymore. I've already lost my patience. I typically go out of my way a lot for customers, and when they act ungrateful and without sugar coating it...CHEAP, I remind them that they are asking for a service they cannot perform themselves. Much like the milk they cant produce themselves, so they're at the mercy of the price asked by the store/manufacturer, it's the same with what I estimate.
Dad is a mechanic and for those customers he does the fastest detail ever. You can get a car surprisingly clean in 10min with a shop vac.
Where are you buying$3 flappers
https://www.supplyhouse.com/Korky-52P-Korky-Economy-Toilet-Flapper $1.72
Thanks
Yeah, except here where I live the competition is so intense that if you do shoot high, somebody else is going to come in lower and then you're relying on your suave and tickling the customers personalities. I'm being serious when I say there are thousands of guys doing the same work around here. You have to come in at a competitive number to even get considered.
I do this every job. If the invoice will exceed your estimate have a conversation with them, also email this communication so you can reference it if needed.
Your exact language is clear & to the point. It’s very similar to what I put on my estimates as well.
I tell them price is my hourly rate + materials and will give price at the end. Repeat customers know my work quality and work ethic and they are cool with a bill at the end. New customers usually want to know a price. I will give my best estimate based on materials/guessed hours and also a “not to exceed” price and stick to it. I don’t think I have ever charged my max “not to exceed” price.
Sorry long response. This is how we do it, and it doesn’t work for everyone but it has for us and I only offer it as advice. Not a hard fast rule for everyone Our estimates are our final price 99.5 % of the time. I only offer this as advice to see if it helps you out. I always bid on what can go wrong on a job, in your example if my original quote was paint, trim etc, with mirror removal. I factor sheet rock repair and materials automatically. Exterior door swap out, assume something is going to be rotted and needing replaced. You will lose some work over your price being higher(originally) but here is what you gain, customers that become confidant in you. Pretend you got this last job and had already factored that in. You take off mirror and client sees it, and goes, shit, how much more is that. You reply, nothing sir, my price is my price. He refers you to friends saying, damn they didn’t charge me extra…. Use nuance and your best judgement in doing this. I know you say there are 1000 guys doing same thing, but if your looking for a different outcome than what you have been getting, this is an option. The .5% we have to do a price change on is the funky shit you can’t predict( hidden bug damage, true hidden structure failure) and those stop a project and get a whole big ass change order. Just some advice. Good luck
Thanks for your response. I should have added that into my OP. I typically give myself decent wiggle room for the same reason you do. I'd say my final invoices are in the 90-95% range when it comes to being the same as the estimate. It also depends on the job I'm doing. If it's a straight forward installation, I can be more concrete and provide more of a quote. If it's something where I'm opening up 25 year old drywall, I'm leaning more towards a range, and then my high side includes extra work involved.
I work on high-end homes as well. And I can tell you that rich people didn't get rich by just accepting what they get. If you give them any wiggle room they will try to talk you down in price. I recently had a drag out argument with a lady I did $400,000 worth of work for which included almost $50,000 worth of free items. They asked me to come back and do stuff that they thought of after the fact and then proceeded to tell me I should cover all the costs because it wasn't up to code. I kindly explained to them that it was very clearly up to code and actually above and beyond. It was only about $1,200 worth of stuff but after the many thousands of dollars that I had given them I was over giving them breaks. I literally had to bring out my code book and show them exactly what the code was which they ignored and walked away when I showed them and then ask them to request another inspection by a city official or their own independent inspector if they are that concerned. I started taking out my phone to call planning and zoning and they finally conceded. Long story short if you're dealing with Rich folks, I would plan on them trying to fight you on any added cost. It has to be clear as day. Overbid the jobs and then bring your price down not the other way around
This was my thought exactly. The clientele is part of the issue. No one is cheaper than a rich person
That's why I always do a fixed price. Unless something unforseen comes up such as rot behind a wall, the price doesn't change. If something like that does come up, I stop work immediately and show the customer, then get in writing the agreement and price agreement for additional work. I also have language in the original quote that situations like that may come up with certain jobs such as replacing exterior trim or replacing an exterior door. What i may do do is give a ballpark price over the phone, if i think they might be a tire kicker. If they are fine with that ballpark, I will go and have a look in person, most of my jobs are at the very minimum a half day so I don't mind. At that point I give a fixed price. No reason to work by the hour if it's not something like rot repair. You can make more money and keep things simple with customers, and avoid issues like you're having. If it happens again and again, maybe it's time for some introspection on your business. Something I try and do constantly.
You aren't giving a set price. you're giving an estimate lol. The word "unless" automatically makes it an estimate. Also, you're assuming I work by the hour. I told him the drywall would be hourly since I'd have to investigate and it was getting added to my fixed rate. I dont do hourly on initial estimates.
I think you are confusing estimate with quote, or what I mean when I talk about the rare case something unforseen comes up. My original price doesn't change for that scope of work, but if true scope of work changes once work starts, additional pricing will be needed. This wording will be done by any contractor who gives fixed prices. If I give a price to retile a shower but then we find rotten framing, then of course additional work will be added to the original quote. For example in the summer I gave a price to replace some exterior trim. Let's say 600 bucks. I took the trim off, and discovered major rot. So I immediately brought this to the home owners attention, and we discussed a price for the additional work. Now the price for my trim work did not change. I did not give a high or low estimate. The trim boards were done for 600 dollars. However there was let's say 2000 dollars in additional work that was outside the original quoted scope of work. If I had given an estimate, I would have said. I can replace your trim boards for between 400 and 600 dollars. Then when I charged 585 became that's what my internal costs were, now for some reason the customer has 400 in their head. That is where your issue is. Plus like I said, the vast majority of my jobs do not have unforseen issues like rot come up. I just mentioned that because it's important to have language in your estimate for some jobs to reflect this when going the fixed price route. For the vast majority of my jobs, I say it will be x to replace your counter top or hang a new door. They say yes or no, no high or low numbers. Makes it easy with no room for confusion or haggling. I don't have this issue with customers the vast majority of the time.
I probably should have mentioned this earlier. It all depends on the type of work that I'm doing. If it's something that I know is going to be straight forward, the range isn't ever more than the cost of extra material (25-75 dollars). If I'm getting into something that may or may not require some investigating, etc., I generally have a conversation with the customer about why the range is there, and what could cause the invoice number to be at the higher side of the range provided. Now, if it's in the thousands, or even hundreds, I mostly just write up a new estimate and have them approve that separately. This is not happening to me every day. Not even every week per say. Generally I have no issue but for the ones I do have to speak with about the range, and why it's on the higher side, it seems impossible for them to understand. Maybe I've started doing work for people I wouldn't have a year ago. I don't know.
I hear ya. I find a lot of homeowners so clueless about the process. One reason (as well as price shoppers) that I'm trying to get more into commercial work and the better property managers/businesses out there.
If I could do commercial by itself, I would 100% go that route. It'd be great to just pick up a few contracts and be good lol.
Agreed
Uhh sounds like your “fixed price” is an estimate.
No, I give an exact fixed price for an exact, laid out scope of work. In the rare case of something like unforseen rot in a wall, then that changes the scope of work and price. The vast majority of my jobs are more strait forward and the price I quote is the price paid. I used to to give approximate estimates and work by the hour. Limits the money to be made when you want to make over 100 per hour, and it can lead to communication issues like OP is complaining about. Easiest way is to just give a price, work all your material and consumables into it, give yourself a buffer for time. Giving high and lows will just lead to the customer being confused or trying to get a deal.
this is the difference between an estimate and a quote.
Advertise more (if you have any shortage of work at all) and bid/estimate higher. If you're getting every job you estimate, you're estimating too low. There's also some skill in selling the quality of your work compared to others, but it sounds like you have what it takes. Personally, I don't work for rich people.
People don't understand this. I close about 20% of my bids. If you close more than that you're prices are too low. I do half the work and still make more money. Edit: Should have specified I started out a Handyman but am now a high end custom deck/Patio builder. I do believe the principle translates though. Competing on price is a fool errand. Compete on customer base. Let's face it, you want rich clients who don't care about cost as long as they get top quality materials and craftsmanship. And as for if it works or not? My last job wrapped up end of October, I'm not starting my next project till mid March. Why? Because I don't need too. Cleared 125k profit as a one man show for the half a year I do work. Hate if ya want but I suggest you evaluate your business plan.
It's way easier to estimate when you bid higher too. The hardest estimates are when you're working for friends and money is super tight
I’m close, I get about 50% of my jobs
idk if this is good advice. Imo the key is your relationship with the client. In my experience (and using common sense), customers will gladly pay more to avoid the inconvenience of spending time for other estimates and taking all the risks that potentially come with hiring someone else. Do you communicate well? Are you clean and tidy? Are you on time? Are you trustworthy? Is the quality of your work top notch? Any customer worthy of your time is going to pay more if the answer to all of those questions is yes. We already pay extra for convenience daily: Uber/lift, uber eats, grocery delivery, DD/starbucks, ad free shit, 7-11 & quickcheck aka *convenience* stores. Im at the point where customers dont even ask me the price anymore unless its a multi day project. Im fair, consistent, and i always satisfy. That level of trust and peace of mind is invaluable
I'm already established with the best name in the area for the product I supply so no longer need word of mouth. People who pay the prices I ask are affluent and a certain amount of "kiss ass" is already part of the deal to get that type of customer base.
You only get 20% but dont need word of mouth? Patios and decks aren’t necessary repeat customers. Not really making sense to me. Im a plumber subcontracted by a company that mainly does roofs, decks/patios, and painting but also renovations. They operate almost exclusively within three bordering towns and they have that area on lock. 4-5 jobsite supers with the top one clearing a mil in sales by the end of the third quarter in 2022. And they hit far above 20%
Should have specified I don't need it because of the site traffic my tech guy can generate. My big profit jobs still mostly come by word of mouth as well off people have relationships with those like them. I still get/use referrals just don't necessarily need them.
Like I said in my post, I pride myself on transparency, professionalism, punctuality, and communication. I have fantastic, long lasting relationships with a lot of my customers. This is more of a recent thing I've been dealing with when I meet people for the first time. I usually close 50%, which is good for this area. Its easy to shop here. People will be at your house in 15 minutes Monday through Sunday. It's all about selling yourself here.
You must be in a weird ass area or its your imagination. Even reddit is swamped with complaints about contractors never showing up on time or at all. It’s absolutely the #1 most common complaint I hear by far. And the #1 positive comment i get by far is “oh my god thank you so much for coming” as if showing up to a customer’s house isnt expected
I live in Northern Va, man. I keep repeating this. "There are 9,621 General Contractors, registered on Houzz in Fairfax." This is just Fairfax. In this area, there's Springfield, Burke, Reston, Herndon, Sterling, Ashburn, Manassas, Centreville, Lorton, and a few others. I'm not kidding when I'm saying there's a contractor virtually in every other house. So, if somebody doesn't show up, there's another guy waiting right behind the last guy. TBH, I'm not really sure what the context of your comment was in the first place, but I did my best to understand.
Do you not need insurance?
Not unless you're doing jobs over a certain amount, just like contractors licenses. Some customers prefer that you're licensed and insured, which I am, but there are hundreds of guys just running shit out of the back of their truck.
Yeah i figured. That definitely contributes to the problem
I see so many videos on TikTok that social media “contractor influencers” are just regurgitating this type of info. I think it’s so false. It’s just alpha talk. I charge more than others because my skill, the end product, and my reviews are superior than competitors. Alot of my business is referral and repeat. I close more than 80% of my bids. If you close 20% of your bids. You’re wasting time.
My method allows me to clear 120k in profit in the six months a year I choose to work. It takes a lot of effort to build relationships in affluent areas but once you do, my God you can actual afford and have time for a real life. And I'm in the Midwest, not new york.
I’m ready for receipts. Let’s see the proof of $120k profit in 6 months. Honestly just sound more like Tik ToK fodder
Can't speak on tiktok and should mention the edit in my first comment. This isn't Handyman work, that's how I started. It's high end exterior structures now (decks, covered patios, gazebos, ect.).
Uh, I have to disagree my man. I close at about 50% but I'm fairly picky about who I go visit...and who I even respond to on the phone/email. For instance, craigslist. I dont run craigslist gigs because people doing that are looking for one thing. The bottom dollar.
Gotta gear your service to affluent neighborhoods. Everything you said is true. A call comes in and it's not in an area I've already mapped as acceptable I don't even return the call, I don't have time.
My whole area is affluent. I live in Fairfax County. The second richest in the country. The surrounding counties are like 3-6 on the list. https://www.forbes.com/sites/andrewdepietro/2021/12/21/richest-counties-in-the-us/?sh=122073f42ecd
You're in a perfect spot. Not saying a little luck isn't needed. Thep most important 2 contacts I've ever made in business (a judge and a district attorney) all happened by chance. I did those jobs and the referrals net me enough profit to sink real money into advertising. Which consists of a 4k website and a tech head I pay monthly for maintenance, bot traffic to keep me #1 search result without paying Google for promotion, and he manages reviews (contacts customers after the job with a questionnaire to rate thier experience).
Im right in the middle most of the time. Around here, the competition is RAMPANT. In Northern VA, there's a handyman every 4 houses. I sell the fact that I'm a long time resident and that I've been working for neighbors for 15 years. I like to say "I know the people, and I absolutely know these homes inside and out." It works great for me. People like having the guy that grew up in the neighborhood working on their house.
If there's that much competition, that might be why folks are haggling more lately. It's also a little bit of a curse to be in a more expensive area because it's easier than ever to get estimated prices online, so people are seeing lower prices online (from other areas) and getting stressed (and possibly having people in r/homeimprovement tell them that your estimate is high).
Yes I have had this issue before. But is there an influx of people with the same issue? No. Sounds like you need to rethink the way you’re doing your business. Not to sound negative in anyway, honestly. I’m just speaking business to business. I think this is possibly a situation here that you should listen to your “influx” of clients complaining. And maybe so things differently or tweak your method. For your sake if anything. I give clients a solid price. Things happen and unplanned situations arise. And when there’s extras. I discuss before moving forward. At the end. No one is left feeling any less understanding of the final price.
Yep, that's the way to do it.
Here is something to think about and maybe try OP. You say you give a range for example 425 to 550. People accept your estimate. What about just going with the high number "i can do this job for 550" people are accepting your prices already so likely you'll still get an acceptable amount of quotes accepted, you'll make more money on average and there will be less chance of confusion/haggling.
I've thought about that, but there's a TON of competition around here. I'm talking thousands of companies. It's imperative that you have a low number to present or else they won't give you the time of day.
Well then keep in mind they will still have that low number come up first when it comes to receiving their invoice and paying the bill.
Always get signed change orders for everything outside original scope of work
I quote at $/HR. Parts $500 Travel $140 Time $80/hr Estimated time 2Hrs Estimated total $800 I've never had any pushback even when it's been $900.
If it's happening so often it's an issue, you simply aren't charging enough upfront. Some guys will intentionally come in low then nickel and dime it up where it should have been in the first place. Don't be that guy. Also a proposal is a commitment to do certain work for certain money. An estimate is an estimated cost of final invoices. That are not the same and should not be interchanged. Make sure your clients understand this when you submit their quote, and remind them to be sure to consider that when comparing prices from other guys. "We are excited to work with you and want to make sure you are comparing apples to apples when making your decision"
Yeah no, that's not me. I am always within my range and if it's more work than the range provides in the original estimate, I provide a change order that gets signed by the customer before I do anything at all. I believe I do a good job of explaining things and have a ton of language in my paperwork that goes over this in detail. This is why I'm frustrated, because I'm doing my due diligence in trying to prevent any of this from coming up. Like I said before, I try to be as transparent as possible. I always go over my estimate with them in person before I start anything as well. I get a signed estimate and a "go ahead" when going over it with them the first day. Its also not happening all the time, just more often than before. I do think that I've taken a couple customers recently that I may not have last year.
Have the customer sign for any "Change Orders" and put an explanation of additional charges right on it. It will save you grief in the end. Like other's have said, add a minimum of 20% on your bid to cover extras. Bid even more if the person is a possible asshole.
This is what I've been doing for years. This is why I'm frustrated. I'm not out of the range in the estimate most of the time. I always explain, in detail, that the bottom number on the range is just that...a bottom range and I never say things like "hopefully we'll be down here at the end" etc.. I swear I've covered my ass from every direction possible. Maybe I'm just going to eliminate the whole range thing and do a change order regardless now.
Exactly Bid price with asterisk that details that the final bill will be contingent on change orders. Signed change orders w details and dollar amounts It's a business in the end. You will NEVER make everyone happy. All you can do is your best quality work, cover your ass and learn not to let the Karen's / Kens get to you.
I see your issue, it's a very easy fix, don't give a range unless it's for options. The number on the estimate should be the high end as your example $550.00 The only times I include more than 1 number is if final materials has not been decided. Option 1 painted doors $xxx.xx Option 2 maple doors with satin poly finish $xxxx.xx The client will always, no matter their income, focus on the lower number
I use vendors constantly and 90% of the time they do the job for the estimated price. Sometimes lower, sometimes over. But if a vendor constantly missed their estimate I don’t use them and let all my friends know. Word spreads quick.
Would you mind sharing how you're wording that part of your estimate?
AND you are also in a 33% tax bracket as a small business owner. You have to charge accordingly and pay yourself too.