Do You Round Off Your Bids?

rbsremodeling

I write it up and let the home owner's choose their price and right it on the estimate saves us a lot of back and forth.

I close 100% of my jobs by the way

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wellbuilthome

Thats funny . My jobs all ways cost 10, 880 or 580 .
In the 80s we ran a special for a addition , it was 21, 880. John

Tinstaafl

Hey guys, we gotta keep this thread going until Dave has the complete collection.

concretemasonry

Much depends on the customer and the ability to understand him.

As a Sales Manager, we had a smaller long term customer that did about 30 jobs per year of about 3000 split face block and 1000 plain block at different locations within 150 miles. Typically, the purchasing manager/engineer would call to contest a quotation and cite previous prices for other jobs at different locations.

After going thorugh the justification for price differences for 5 or 10 minutes, a voice on the line would come through and say - "Dick, this is Al here and the price is not any good".

Since I had gone through that several times, it was not a surprise and I lowered the price 10%. He said - "You knew I was listening all the time and you planned to cut the price in the end!" - You have a deal.

His motivation was the game and challenge of buying as cheap as possible even though he had made up his mind in advance who would ultimately supply the block. - Fortunately, I had a good salesman that provided accurate insight into the situation(s).

The purchase order came about a day later along with a $100 dinner certificate/credit.

It all depends on the attitude of the customer and his methods. Of course, a single purchaser with a history is much easier to size up than newcomer. - Just before the telephone contact, the customer sold an oil refinery for $145,000,000 cash. I would hate to be involved in the big negotiations on that, but it might have been easier and less fun.

Bottom line is to recognize and size up the customer as best as you can to determine what/where/how to give in and keep everything going on profitably. You cannot be emotional, you must be practical.

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Dick

Engineer, designer and consultant recently active domestically and internationally on construction and design in about 35 countries.

DavidC

Next up, quotes that end in 5 or 8. Stay tuned.

Good Luck
Dave

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www.CookContractingLLC.com

silvertree

Why the 6?
When I started selling I got a couple of big jobs that had a 6 in the total. For fun I added a 6 in the next one, then I got on a good streak and just kept making sure I always had a 6 in my bid number. Now its about 25 years later.
I always add a 6. Other than that, I am not at all superstitious.

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Vote for Pedro
Kitchen, bath, St Paul remodeling
Minneapolis Remodel Blog
203K Loan Consultant Minnesota

buildpinnacle

I never know whether to take you serious, Rory. However, serious or not, this is a very good close and I am intrigued. Very similar to a car deal. Where do they typically start?

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Tinstaafl

Uh... He's from DC. Do I really need to elaborate?

rbsremodeling

50% are higher than what I would have charged them. You let them talk and talk and get comfortable.

Just ask them what have they looked at, what type of materials, who bid the job and they will give you a reasonable cost in about a hour or so you pretty much know what they will spend and it is usually equal too or more than what I would have bid.

Most people I deal with are still shell shocked from pricing 5-8 years ago when a bathroom was 40K and up and a kitchen was 60K an up.

I present it as a joke/ice breaker of course and they always write a number down

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BuiltByMAC

I'll pose it as a question -
you guys who run the number down to the penny, how do you account for waste?
if you price it by the screw and you strip a head out, where is that accounted for?

The concept of variable amounts of waste, in my mind, negates the pinpoint accuracy of "to the penny."

Mac

1mancrew

Always round off...I don't work for pennies.

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www.KirbyCustomHomes.com

PA woodbutcher

Material is plus 10% for waste, unless there is a diaganal pattern and then it's plus 30% for decking, beadboard or whatever.

Never really thought about the rounding up or rounding down thing. There are times on a small job that I can price on the spot, I'll round up to the nearest fifty.

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'The trouble with our liberal friends is not that they're ignorant; it's just that they know so much that isn't so.' - Ronald Reagan

Leo G

I use a couple of formulas for calculating out cabinet runs. If I have an odd cabinet run, say 103 7/8" it ends up with pennies in it. I just run the formula and write it down. Sometimes I round a bit, sometimes I don't. I usually end up with change in the price. I think that ending in $10 or $100 increments looks like a guessimate more than a bid. When I do ballpark figures I price in $100 increments, it is an educated guess of course.

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Sawdust Follows Me Everywhere

http://lrgwood.com
Custom Cabinets in Hartford County Connecticut

DavidC

Here's what I've learned from this thread so far.

If you use a decimal point it doesn't seem to matter much if it's followed by 00 or loose change.

It's best to use all of the numbers if you can. Should go without saying, but you'll need to be up on how to use commas.

I'm ready to sell.

Good Luck
Dave

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www.CookContractingLLC.com

greg24k

3000 split and 1000 plain blocks you talking about very small job. If you have a 200 foot wall, thats 150 blocks one course X 10 its 1500 blocks. Mason crew of 2 operators and 2 laborers can do that in 3-4 days. So it sounds like you got guys doing more driving then actually doing any work. Cutting cost by 10% sounds a little steep and I don't know what you charge per block, even if it was $2 labor per block, I can't see a company making any money. But if it works for you then its alright with me.

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Soloplayer

I generally add 10% to my bid to account for unpredictable events.

For example: $ 23,400.00 x 10% = 2,340 + 23,400= $ 25,740.00 .

Unpredictable events:
Weather (hot or cold), unavailability of materials, medical insurance increases, Calif. sales tax (just went up 10%)........... Anyway, I think you get the idea.

ps: Excessive customer hand holding.

Double-A

Our price always ends in "Thank you".

As for rounding up or down... It depends. If there was a three day weekend, I usually have to round up one or two of the new guys. If its the Friday before a three day weekend, I usually have to round them down a bit.

Ah, the cost of doing business.

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"My clients’ wishes are the center of my attention." -- David Guido, a contractor in Woodstock, N.Y.
New York Times, July 20, 2006

Leo G

Can I give you a check with the words "You're Welcome" on it instead of numbers

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http://lrgwood.com
Custom Cabinets in Hartford County Connecticut

Mr. Mike

I always give them a number like $11,928.61, and when I say the number I will say it real slow just like, eleven thousand nine hundred twenty eight dollars and sixty-one cents. Sorry about the cents I just really work hard to figure your job down to the penny, I know its a great deal for everything so feel free to add it up.


It's late nobody is looking I'm going to Edit to add a little close and some things for fun: I don't think there is anything wrong with adding it up or down, it really depends on how you are working your close, for me this exact price seems to work better because it gives me one more bullet to use for later on during the close, I can say did they give you a written proposal like this? Detailed? How much was it? Oh they gave you an exact amount? Really, we'll if they will round it off they may of just winged the price all together, let me ask you this; If all prices were equal do you still feel that I would meet and exceed all of your expectations? (They never answer any of those the first time you ask, but I don't move from detailed to how much until they answer the detail and so on) Of course they will say yes, or we need to over come that anywho. Great, let me take a look at this proposal and see were we differ in our charges, because I want to do this job if it is possible and I know you would like for my company to take care of this beautiful paint job for you if I can. Now when I do this the goal is never to lower my price, however it is to build value back in to my price so that they will buy, I get paid and they get a great job done.

I like the 6 idea, I'm going to start that immediately.

Mac,

Great Question!

If you charge for installing something rather it be paint, cabinets, roofs, or even but not limited to just concrete and you are providing all materials and waste the only thing you can do is get a system together and know your waste on for say painting one room or hanging 20 cabinets. Your price to paint that room may be $5.26 to paint the walls per sq. ft. of walls and if that is the case then there may be pennies on the total and you can insure the customer that you figured it down to the penny and you can do this because you have did so many jobs just like this one. It gives you one more reason for them to trust you and buy from you over the other guys.

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DivineGC

I round up to the nearest dollar. for example, if my estimate is $21,924.28, my price is $21,925.00.
As for residential customers looking to bargain, my price is my price, it is non-negotiable. "I gave you my best price for the quality of work you expect. If you want to negotiate, let's remove items or change materials. example: Instead of solid 6 panel stain grade wood doors, lets go with the paint grade hollow flat doors." I learned that if you are willing to negotiate, the customer believes you are making way too much money on them and they want to negotiate throughout the project. We should all feel we are the best at what we do and our customers need to feel that way as well, if you discount your price, you are going to need to shortcut somewhere and therefore may not be able to give the best finished product therefore the client will still think they overpaid and it could ruin your reputation through word of mouth referals.

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