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Old 01-13-2020, 06:39 PM   #1
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Default Bid pricing complaint

When someone questions how we price a job, depending on how much we want to work with the customer, we'll either tell them one of two things:

1) if it's a very small difference in price, such as, a couple of hundred more than they were expecting to pay (and they seem like people we want to work with, 'cuz we're picky that way!) we'll tell them what they are getting with our services, and refer them also to our website, Yelp, Angie's List, FB, etc where they can read our reviews--including their own neighbors.

2) if it's a significant price difference (say, the job is bid at $9K and they budgeted for $4K) or other reasons why we're not interested in working with the customer, then we'll politely out tell them it's not going to work out (with no explanation about pricing or selling ourselves)

I'm curious--how do you handle a customer complaining that their bid is too high?
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Old 01-13-2020, 08:00 PM   #2
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I tell them that I have been doing this for a very long time and I feel I should be compensated for it. I also ask them what they do and will they lower their fees or prices. Why should I not be allowed to make a decent living. I stopped working for beer wages a long time ago.
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Old 01-13-2020, 09:10 PM   #3
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How do you end up bidding for a homeowner where there is over a 100% discrepancy with the service cost? That scenario would indicate a massive miscommunication that somehow got overlooked. Do you ask your customers what their budget is before spending the time estimating a job for them? Because, I'm sure a lot of wasted time could be avoided. For example:

Homeowner- "Hi Jeff! Thanks for calling back. Marilynn recommended you and I just wanted to get an idea of what it would cost to paint the outside of my house. I know the back is in pretty bad shape and...I'm just not sure"

Jeff- "No problem Joyce... I mean Jackie. I drove by it yesterday and you're right, that back is in pretty bad shape"

Jackie- "Oh boy."

Jeff- "I don't know what you've budgeted for the repairs and painting, but you're looking at around nine thousand dollars. Of course, I'd have to do a thorough assessment in order to give you an accurate estimate.

Jackie-"Oh my God! you're kidding?" "I thought it would be around four thousand or so."

Jeff- "Well, I can give you a detailed quote so you have something of a baseline when comparing our service to others." "And as you know, we are licensed and insured, which a lot of guys out there aren't."

Jackie-"Well you did come highly recommended." "Let me talk to my husband and we'll call you as soon as we can."

Jeff- "No problem"

Two weeks later, Jeff got the job and now has another referral in that neighborhood.
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Old 01-13-2020, 09:25 PM   #4
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Quote:
Originally Posted by CApainter View Post
How do you end up bidding for a homeowner where there is over a 100% discrepancy with the service cost? That scenario would indicate a massive miscommunication that somehow got overlooked. Do you ask your customers what their budget is before spending the time estimating a job for them? Because, I'm sure a lot of wasted time could be avoided. For example:

Homeowner- "Hi Jeff! Thanks for calling back. Marilynn recommended you and I just wanted to get an idea of what it would cost to paint the outside of my house. I know the back is in pretty bad shape and...I'm just not sure"

Jeff- "No problem Joyce... I mean Jackie. I drove by it yesterday and you're right, that back is in pretty bad shape"

Jackie- "Oh boy."


Jeff- "I don't know what you've budgeted for the repairs and painting, but you're looking at around nine thousand dollars. Of course, I'd have to do a thorough assessment in order to give you an accurate estimate.

Jackie-"Oh my God! you're kidding?" "I thought it would be around four thousand or so."

Jeff- "Well, I can give you a detailed quote so you have something of a baseline when comparing our service to others." "And as you know, we are licensed and insured, which a lot of guys out there aren't."

Jackie-"Well you did come highly recommended." "Let me talk to my husband and we'll call you as soon as we can."

Jeff- "No problem"

Two weeks later, Jeff got the job and now has another referral in that neighborhood.
I think you took me a little too literally--the 4K/9K was just an example--not saying we actually bid something at 9K when they expected 4K.
Also, we don't get into what someone's budget is--it makes cost the main focus vs. service. Residential customers rarely understand what the actual cost is anyway, in our opinion. In the customer's head, it should be A when it's B. But that's just our approach--not saying everyone should work this way.
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Old 01-13-2020, 09:26 PM   #5
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kmp: Spot on, 100% agreed.
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Old 01-13-2020, 10:03 PM   #6
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What HOs expect to pay is in reality what they had hoped to pay since most don’t have a clue as to what is involved, and hence the time needed, to do a good job.

If they are comparing my number to another PC, then I just ask them to be sure to compare all aspects of the bid. Just because somebody else turns in a lower number doesn’t mean it’s a better deal for the HO.
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Old 01-13-2020, 10:10 PM   #7
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I know who I am, know my standards, know my numbers. I cannot lie to myself.
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Old Yesterday, 07:20 AM   #8
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Know your numbers. Knowledge is power. Pre-qualification over the phone can also save alot of time. AKA Ballparking. Especially for cold callers.
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Old Yesterday, 11:49 AM   #9
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An elderly neighbor of mine wanted me to paint his house. I dragged my feet for a while to get him a price because I knew it would be a ‘difficult’ job. I said go get a couple bids and I will let you know if I can beat them or not. He got one yesterday that was so low, I told him I was concerned about his liability, even though the painters contract stated he had WC. It was far too low a price to be a legit paying business. I told him my price, to which he said he couldn’t afford it anyways, so I’m off the hook thankfully. Now I’m in help the neighbor mode with advice a bit and just hoping someone doesn’t screw him over.


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Old Yesterday, 01:40 PM   #10
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2) if it's a significant price difference (say, the job is bid at $9K and they budgeted for $4K) or other reasons why we're not interested in working with the customer, then we'll politely out tell them it's not going to work out (with no explanation about pricing or selling ourselves)

This might sound crazy, but I like this 2nd scenario when it IS a customer that seems to be a good fit. The fact that they are taking the time to ask questions why the bid is high means something. You left an impression on them. Don't just write them off. Take the time to answer their questions and explore the options, you might be surprised with the outcome. If you didn't leave a favorable impression, they would've just gone with the other bid.
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Old Yesterday, 01:46 PM   #11
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Quote:
Originally Posted by kmp View Post
I tell them that I have been doing this for a very long time and I feel I should be compensated for it. I also ask them what they do and will they lower their fees or prices. Why should I not be allowed to make a decent living. I stopped working for beer wages a long time ago.

This just seems too confrontational for my agreeable nature. After all, it's just painting. A service that's a dime a dozen, and very competitive. I think taking advantage of a teaching moment rather than belittling the homeowner is more tactful. JMHO.
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Old Yesterday, 07:44 PM   #12
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I feel a certain tension between Jackie and Jeff...just sayin'.
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Old Yesterday, 09:41 PM   #13
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We're not against telling the customer why our price is what it is. But how much effort we put into this response depends on a lot of things. In 18 years, we've found that things go best when we trust our gut instinct vs. going against it. If someone seems like they might be difficult from the get-go (you know, those little red flags, maybe it's a comment they make or something that just doesn't sit right)...chances are, they will be difficult, start to finish.

(also, side note: we don't ever give a "ballpark" verbal. We go home, look at our extensive notes, and then type up a proposal)
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Old Today, 01:09 AM   #14
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If you go home and write a formal bid, the scope of work is defined. Your customer should know what is involved and what to expect. They may question at this point. My experience, rarely do they actually complain. If they are complaining, rather than questioning, then it's probably best to part ways graciously.

If someone calls me for a quote, I prefer to get the information, and throw a "ballpark" figure out there. Some people have NO CLUE what a job costs. If my "ballpark" is out of the park, there's no need to waste our time setting up an appointment and giving them a formal quote.
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Old Today, 01:46 AM   #15
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Quote:
Originally Posted by juanvaldez View Post
An elderly neighbor of mine wanted me to paint his house. I dragged my feet for a while to get him a price because I knew it would be a ‘difficult’ job. I said go get a couple bids and I will let you know if I can beat them or not. He got one yesterday that was so low, I told him I was concerned about his liability, even though the painters contract stated he had WC. It was far too low a price to be a legit paying business. I told him my price, to which he said he couldn’t afford it anyways, so I’m off the hook thankfully. Now I’m in help the neighbor mode with advice a bit and just hoping someone doesn’t screw him over.


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"Help the Neighbors" and "Help the Family/Friends" is generally to be avoided in my book. And if taken, needs to be perfect.
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Old Today, 10:55 AM   #16
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If they prequalified over the phone and I go out to do a bid then I’ve already given them enough of my time for free so I try to keep any further effort, especially writing stuff out, to a minimum.

If it’s a job under $1000, I will generally give them a number on the spot and if they accept I will give them a brief handwritten description of the scope and collect my deposit or arrange to have it sent.

A bit bigger job will usually have me checking over stuff at home and giving them a call. If they accept, I will send them an email with the scope info and arrange to get their deposit.

Anything over $2000 that is accepted will get a contract which serves as my written “proposal”.
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Old Today, 04:12 PM   #17
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Quote:
Originally Posted by JA Paint View Post
We're not against telling the customer why our price is what it is. But how much effort we put into this response depends on a lot of things. In 18 years, we've found that things go best when we trust our gut instinct vs. going against it. If someone seems like they might be difficult from the get-go (you know, those little red flags, maybe it's a comment they make or something that just doesn't sit right)...chances are, they will be difficult, start to finish.

(also, side note: we don't ever give a "ballpark" verbal. We go home, look at our extensive notes, and then type up a proposal)

Unfortunately, I go against my gut instinct every morning I wake up and have to go to work. I imagine that if I were self employed, that wouldn't be a problem any longer. But until then, I'll have to ignore my gut instinct to loaf around the house, and get my sorry butt off to work.
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Old Today, 05:11 PM   #18
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Quote:
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Unfortunately, I go against my gut instinct every morning I wake up and have to go to work. I imagine that if I were self employed, that wouldn't be a problem any longer. But until then, I'll have to ignore my gut instinct to loaf around the house, and get my sorry butt off to work.
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