Do You Get Nervous About The Price Before Submitting A Proposal?

Melissa

I just emailed over (yes, I just said email- back off Mike Finely! We email then go over it with them after they've had a chance to look it over. ) a $97,000.00 proposal to a customer, I think I went over it 10 times, but I'm still nervous that we might have left something out. I just get so panicked now, no more like scared to death, since we've forgotten things in the past.

Wish us luck on getting this job. It's 2 baths and a kitchen working with a designer in one of our favorite little communities on the beach. The people are so cool. And this would finish off the year very nice and start off next year nice too!

dirt diggler

It's not the price to be nervous about --- it's the acceptance


No reason to leave anything out --- right?

Tom R

The most worrisome to me is a real fast "YES", - - win or lose, there was still money on the table, durn it . . .

Peladu

When I am bidding on custom work, I do tend to get too anxious.

But I am more anxious a couple days before starting the job, than I am when I turn in my Proposal.

But there's always the times when you are thinking about a Proposal you have out their, waiting to be accepted or declined, and all of a sudden you just get a feeling that you forgot something.

But Tom's right, a quick "When can you start" means I (we) Forked something up...

Melissa

That's exactly what I mean, if this gives you any indication, we get about 100% of all the jobs we quote, without really any haggling. I used to think this was a good thing, now I'm not so sure.

I went over this one so many times that I was just sick of looking at it.

Tom R

Getting 100% of the jobs means you could (should) be charging more . . .

Mike Finley

Melissa, whenever I get that feeling like I'm missing something I go over it and over it, and then finally I just add another 10% and be done with it. I rationalize that screw it, I don't want the job if it's this close anyways, and if I get it, I'll be happy that I did.

Pretty scientific huh?

dougchips

Might be a stupid question but, do you e-mail the price with the proposal or wait until they have accepted the scope of work and materials being used? Is the e-mailed proposal at the customers request or do you folks offer it? What is your closing percentage for e-mailed quotes?

Melissa

We do a lot of emailing, and still get the jobs, and yes, the price is on it.

Maybe emailing for us isn't a factor, because all of our customers have been referred to us by their friends/family/neighbors. Also, we've already had 1 good long meeting with them to get the scope of work, if not 2 for more measurements, drop off more samples, etc.

We never deliver the proposal and try to get them to sign on the dotted line, right then and there. We're not pushy at all.

Nick H

Thats it in a nutshell, once you get to that point you DO NOT need to try and compete on price, people are willing to pay top dollar because you can and will deliver a top dollar product. ALL the work I do is referall and I can and do charge top money for what I do, BUT it means I can afford to deliver a quality product and people are willing to pay for that and more often than not are prepared to wait for it. Where I live and work reliable/honest/skilled tradesmen are worth their wieght in gold.

__________________
Dont give me problems, give me solutions.

dirt diggler

Melissa,

Not to melt the ice cream (ugh, is there a better analogy I could have used?)

but a month or two ago you were talking about being in a tight financial position

So, this came from A) Not charging enough and/or B) Not completing the jobs fast enough

Most likely, it was a combination of A and B, with more emphasis on A


It's nice to have work ... but why scrape for pennies when you could be stackin quarters??

And I'm not directing this at you --- but "Just Say No to Lowballing"

It makes you poor --- and it makes me poor too, cuz I can't compete with someone doing 30% cheaper.

It's a waste of a project.

tcleve4911

Hey Melissa - Quote what you know & give allowances for the unknown. It's all in how you write the contract
Tom

__________________
Back in Maine
Dubbin' Around
Doin' good stuff ......

Melissa

This is exactly why I'm so nervous.

And we don't lowball. We just try to price accurately, and add 20% markup for just in case, and we ALWAYS think we're going to make a killing, but it NEVER happens, actually the opposite does, because we accidentally leave things out- like a master bath we just finished. Hubby purchased the tile, then I checked to see what we factored in and..... there wasn't anything factored in! Only the labor price. I have NO idea how that happened. So there went $900 down the trash, plus any markup we would've made on it. Then he didn't charge enough for a couple things that took way longer then expected. This kind of thing just happens repeatedly on all these custom kitchs/baths. I think I've made a foolproof system now, so hopefully we'll start to make some money. And we're thinking of having something going on the side that is the exact same thing over and over again, so pricing will be easy- like replacement windows, or concrete...

john elliott

On the other hand, and I presume you are not working T&M but fixed price bid, if you had factored in the tile at $900 plus markup, then your bid would obviously have been that much higher and you may not have got the job- so you haven't necessarily lost money.

John

Tom R

Are you kiddin' me??

If you don't view accidently 'buying' the customer their materials as the lost money it is, - - you won't be in business very long.

Losing a job is better than paying for one . . .

On the other hand, - - Melissa is working on correcting such problems.

john elliott

I'm not kidding you, but I don't think you understood what I wrote.
Let me explain it like this- suppose the total bid was for $20,000, and the correct bid should have been $21,500. Now, it's all very well saying that that is exactly what the bid should have been, but what if because of the extra $1,500 they hadn't got the job?In a case like that, then the money lost would not have been lost because it was never there in the first place
I only said they hadn't necessarily lost money.

John

Tom R

I guess you're tryin' to put a ribbon on a turd, John.

OK, OK, - - good to try 'n look at the positive side, - - but 'not' doing the job just means (hopefully) you'll be making your money somewhere else in that same time frame . . .

I understand what you're saying, though.

dirt diggler

Melissa don't the following personally --- I'm just trying to help you (cuz you asked for help, and I like helping ... oh and I'm waiting on dinner )

When you posted like a month or so ago --- something I said in my response was "YOU NEED TO FIGURE OUT WHAT WENT WRONG AND FIX IT" --- or something to that effect.

1) You have not done that yet --- or at all, judging by this thread. Why not???

2) $900 down the drain is $900 down the DRAIN. Lost!! And that's not just lost profit --- in fact, you had to SPEND money just to be able to lose it. See what I mean?? That is worse than losing profit. Heck, at 20% -- I mean, that is gas money for TWO WEEKS.

3) "Accidentally leaving something out" ... hey, we're human. Once in awhile is ok -- it's a mistake. But you say you ALWAYS do this.

4) How many bath/kitchen remodels have you all done?? Having done ONE is enough to produce accurate bids. After 3 or 4, you should be able to come up with infield estimates in your head. I'm guessing you've done more than one --- so why can you not produce accurate bids??

5) A foolproof system?? and you "hope" to start making some money??
C'mon ---

Take the cost of the job. Material and labor.

Now, take your company overhead (how much will it cost you to operate during the duration of the project). You're not doing anyone any good if you belly-up during a job. This includes everything from insurance to stamps for mailing invoices.

Don't forget gas, payroll, etc. Factor this all in. YOUR CLIENT SHOULD BE PAYING FOR THIS

6) And now you're thinking of a side business??? You need to get the "front" one straight first.

7) "We don't lowball" --- you are and do not even realize it


Really sorry if it sounds harsh. But I think you need someone to come down on you and point some things out. And what better than a total stranger?? Hate me all you want, but at least think about things and be honest with yourself

BTW --- I've made these mistakes too!!! I am by no means perfect. In fact, I haven't even gotten through kindergarten in the business world. Heck, sometimes I wonder if I'm even cut out for it.

But you make them [mistakes] once. Not twice. After the first time, it is either laziness or ... well, .... what else is it??

Life's too short to struggle when you don't need to be strugglin

mahlere

that's the "we lose money on every job, but make it up on volume" business plan.

If the job should have been $21,500 and there is 10% profit in the job. That's $2,150 profit. Deduct $900 for tile that you forgot, and now you are at $1,250 or 5.8% profit. Another error or two and you just bought yourself some work.

So, not to offend anyone, but if the job should have been $21,500 to cover costs and make the profit needed to keep the business in business, anything less and you are losing money.

dirt diggler

ok, so $1,500 is gonna break a $20 deal??


necessarily lost money?? John, as I said above --- they had to SPEND money in order to even LOSE it.

Now, let's say you "accidentally" omit $1,500 from a 20K job. Let's also say you mark up 20%. Well, at that point you just BLEW nearly HALF of your markup profit.

Let's say you go and do this 3 or 4 times. You expect a markup net of 16,000 -- right?? welp, now ya only have 10,000.

See??