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I’ve had several customers accused me of being overpriced because the “other guy” they got an estimate from is licensed & insured too.

So that’s it. In their mind they are weighing apples with apples.

:wallbash::wallbash::wallbash::wallbash::wallbash::wallbash:
 

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There not a customer until you work for them and they pay you. Lots of "potential clients" out there, what they are doing is called an objection, you need to figure out how to handle that objection and turn it into a sale.
 

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People think that painting is easy and anyone can do it. How do you think company's like College Pro and Student Works get work. Heard people say they wanted to help out students when they hired them. Doesn't make sense to me. Have a $300k + house and hire someone that never painted before paint it. May sound stupid, but IMO you can ruin a house with a bad paint job.
 

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You’re right - potential customers.

My point is more about how people think... or not.
How about a HO who hires a contractor that they think is licensed, until an "employee" gets hurt falling off a ladder, it's discovered that the licensed company had a WC waiver stating no employees. HO get sued by "employee" and company loses license.

Details here.

It's not just comparing license, it is the service you provide, give them more to compare.
 

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Yeah, you've got to work on setting yourself above the competition. Attitude, communication, referrals, presentation, scope of work, experience, knowledge, etc, etc, etc. Don't be afraid to sell yourself and your company on any point you can. If they only care about price and you feel confident in your pricing, and you lose it because of that, well, it happens.
 

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I provide a copy of my bond, insurance certificate and BWC cert to potential customers. Make the other contractors produce theirs too. Anyone can say they are bonded and insured. make 'em proove it.
Unfortunately there are too many people out there who only care about the lowest price.
 

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I’ve had several customers accused me of being overpriced because the “other guy” they got an estimate from is licensed & insured too.

So that’s it. In their mind they are weighing apples with apples.

:wallbash::wallbash::wallbash::wallbash::wallbash::wallbash:
It can be frustrating LA.

As I've mentioned before.....It has been my experience in these parts that it is NOT license & insurance, or even the quality of the work that separate pricing. It is taxes and payroll expenses. There are plenty of "legitimate" contractors who are licensed and insured in these parts that use primarily foreign labor and pay in cash. They have lettered trucks and company tee shirts and many times turn out a decent product.

I have never met a home or business owner who really cared about how employees were paid. They do care about getting a quality job and they want the contractor to be licensed & insured, but beyond that it is not their problem...and it isn't.

I have hired guys that have been in the industry for 20 years and have never been paid on the books. Many do not want to be paid on the books for many different reasons. I had one decent guy that left because I would not pay him in cash. He's now working for a larger well known outfit. I had a younger guy bitch about the social security deduction because he doesn't believe it will even be available to him when the time comes!!(he may have a point!!)

I see differences in pricing these days of 50%-60%. It is very hard for the consumer to understand. It's also very hard for a contractor to sell with that kind of a difference...especially when the guy who is 50% less is actually doing an ok job & comes recommended. It's funny because many times the larger outfit who pays legitimately has been forced to "dumb down" the product in order to stay competitive so in the end the guy who is paying day workers or even his "employees" off the books is actually turning out a better product for less money and building a better reputation!!! Many times he has happier "employees" as well...which means greater productivity.
The other way to "defer" the payroll taxes is through the use of subcontractors which I know we have discussed to exhaustion. They let the "sub" pay his guys off the books that way the contractor who's name is on the job stays 100% legit.

Obviously anyone who has been doing this for a lifetime realizes that these illegal practices eventually come back to bite these guys in the ass in some way, shape or form, but most are not thinking for the long term. It's not that kind of industry any more. I'm third generation and it stops with me. There's a lot of creative accounting out there and a lot of guys who stay one step ahead of the sheriff and few are the wiser. No thank you.....

I have scaled it back and work primarily off of repeats and referrals after all these years. It's much less frustrating and many times just as profitable. I can't imagine starting out today in my market(and it's a strong market) having to advertise and "compete" for all your work in order to make a living.

This stuff has been going on since the beginning of time, but it is MUCH more widespread than I have ever seen before. The only way to change it is with more oversight from the "powers that be" and I'm not a fan of more rules, regulations and oversight. Attempts usually, if not always, fail and only result in more expenses for those of us who choose to do the "right thing".

Keep the Faith........
 

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Yeh Dave...unfortunately it's becoming the norm. We have been doing more washing as well, but on a much smaller scale than you. People are liking the "hand washing" approach and the profit margin is decent. It's not for everybody, but it's a nice little niche.
 

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Discussion Starter #12
Cliff, you’re a wise man! :thumbsup:

There’s a new app/website called Nextdoor that’s gained a lot of popularity in my area. It connects neighbors, and it is becoming their go to place for seeking home improvement referrals - replacing Yelp and Angie’s List.

People think it’s the greatest thing since sliced bread.

At first I thought is great - esp. since I hate Yelp & AL, but what’s happening now is someone will ask for a house painter referral, and over 50% of the painters people are recommending are unlicensed/uninsured, etc.

It’s become the “hey, I know a guy” network.

My name gets included from time to time, but now I wish it weren’t... I had a HO tell me the other day she’s getting 4 bids from painters on Nextdoor, and she will simply pick the lowest price. Her logic is that they were all recommended, so they will all do a good job.

Being 100% legit ain’t what it use to be, and Nextdoor is making it far worse.

Keeping faith - because that's all I know, but it does get frustrating from time to time.

;)
 

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Every company is different in some aspect. It is your job to market such and communicate this to potential clients.

If a potential client cannot differentiate between you and your competitors, do not blame the customer. That's a failure on your end not theirs.
 

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I simply tell them: "You called me because I came highly recommended; your welcome to gamble your place on the cheaper quote. I wish you good luck." They usually stop me before I get through the door!

I was once called for a quote and arrive to see two other companies on the same elevator. I asked where they were headed and sure enough it was the same residence. I said you can tell the HO I will not attend this bidding fiasco! You guys are welcome too it. What the He!! was she thinking!? :censored:
 
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