Economy Vs. Employers

wizendwizard

I made that pledge 14 years ago!

That doesn't stop my wife and her $400 a day walmart habit.

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"If you start the grout process over, you too could use sparkly grout!"
There is no such thing as an illegal immigrant, they are either illegal or immigrants.
I'm Retired, or a student, don't really know anymore.

J F

shiite! I just came from there....but I will enjoy all my cheap stuff

Zinsco

Check out: People Of Walmart

DavidC

There certainly have been those that borrowed when they should have been denied. The line I hear most repeated is the lenders bundling bad loans and selling them at a profit.

But again, in my view you can point fingers until the cows come home because it is part of a cycle. Easy enough to say it wouldn't be so bad if.... or could have been prevented if only....

I'll say it again, we congratulate ourselves on our greatness when we are doing well and look for scapegoats on the downside.

A few years ago on another forum I remember a couple of posters forewarning us that as good as it was then, a down turn was inevitable and the smart will be prepared.

Let those that will find it lay the blame where ever they want, it won't change a thing. Those that insist on the worse are seldom disappointed.

Good Luck
Dave

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www.CookContractingLLC.com

wizendwizard

Back to the solution side.

How do we, business owners, establish standard pricing and avoid the perception of being overpriced? This was the main arguement the HO had.

We all know that the media is saying that in most area's new construction homes were overvalued.

I seem to be running into this quite a bit. Not just since this economy plunged but overall.

I'm not a new home builder, just a remodeler and I still get grief from HO's about this.

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"If you start the grout process over, you too could use sparkly grout!"
There is no such thing as an illegal immigrant, they are either illegal or immigrants.
I'm Retired, or a student, don't really know anymore.

Meetre

Value is based on perception, the people who bought "over-valued" homes, thought they were valuable when the got them. Our industry has one of the LOWEST mark-up rates I've seen, the majority of our workers are living right around the poverty mark. I don't think "we" contractors are to blame, I think the rest of the world is "over-valued". Just my $.02

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wizendwizard

I agree with this. We have to deal with the "lower" price label all around us everyday. People seem to be relating this value to everything.

Walmart = Lower prices everyday!
Blowes = Lowest
The government = always uses the lowest bidder, then advises HO's to not use the lowest bidder.

It's confusing and I think it is deliberate.

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"If you start the grout process over, you too could use sparkly grout!"
There is no such thing as an illegal immigrant, they are either illegal or immigrants.
I'm Retired, or a student, don't really know anymore.

Meetre

Then we just explain to them how "value" works. You pay more now, and don't have to buy a new one in 2 or 3 years. The perception thing goes even further when you are on the "outside" of our industry looking in. You see the people doing the work on your home/business/whatever, and know they don't make $40K/year. Do some quick "math" to decide you're paying too much without understanding the whole picture of running a contracting business. THAT is our biggest problem. They don't understand that we pay some of the highest comp rates (most don't know that their employer pays comp for them) They don't understand that to bill $1.00 cost me money. They don't understand insurance costs, advertising costs. Tell them the designer shirt they just bought at Nordstrom's only cost $2 to make, why did they pay $40? That opens their eyes pretty quick. But, they still don't get it.

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DavidC

Establishing standard pricing is a scary thought. This is not a standardized industry.

We do avoid the perception of being overpriced by delivering a level of service consistent with our pricing. If your highest bid is selected as the best value than you have done your job. If you perform that job and in the end the client feels it was money well spent than you have served your industry well. If you can acheive those points and turn a reasonable profit for your company at a lower price, bonus.

I'm a remodeler also. I don't hear to much from my clients about the housing industry, but if I did I would just shake my head and commiserate with them. It's a different business and I won't pretend to be an expert in that field. Let them know your focused on your industry.

Good Luck
Dave

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www.CookContractingLLC.com

angus242

Specifically to HO's that think we are over priced, it's about education. I swear, I spend more time with the "education" part of my consultations then any other part. The days of people remodeling their homes cuz everybody's doin it are done for now. A job cannot be sold under the umbrella of it increasing a homes monetary value (in most circumstances).

Marketing a remodel project today has had to change. Now I push increasing a homes saleability or the HOs long-term wants. If someone is waiting for the market to recover enough to dump their house, I tell them they need to offer something different than the 100's of comps out there. Or, if someone is stuck in their home for longer than they anticipated, now is the time to start turning it into what fits their needs best.

When you start educating them about the service you can provide, it behooves you to explain that a good solid remodel is worth more than a quickie Craigslist cheapo. Many home owners are performing DIY or low-budget projects for they same reason; to make their homes easier to sell or personalization. So if a potential buyer was shown 3 homes, 1 with a DIY family room remodel, 1 with a CL remodel and one with a Adept remodel project, which one should be most appealing?

That's how you can sell a remodel. That's how you can justify your prices. That's how you can help the economy. That's how you can keep you and your employees working. Hell, if you want to get cheesy, you can say that by providing quality remodels in a neighborhood, you can technically raise the property values

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Angus
L+M+O+P=C
"Promise only what you can deliver. Then deliver more than you promise"

wizendwizard

Great points and thoughts all around.... That's an A+ for you today!

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"If you start the grout process over, you too could use sparkly grout!"
There is no such thing as an illegal immigrant, they are either illegal or immigrants.
I'm Retired, or a student, don't really know anymore.

Magnettica

I'm hearing that!

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Double-A

To answer the OP's question, what we can do is simple. Get up, go to work and do a great job for a fair price. Negotiate, compromise, reconsider and hope. All of these require an open mind.

Those that blame their politicians for their present situation need to reconsider what the underlying causes really are and why their personal agendas are so different than those of their elected officials. Turn off the talk radio. Turn off the 24 hour news channels. Become a leader instead of a follower. Stop allowing others to make your decisions and tell you your opinions and take control of your destiny.

Mike has a great subject in his signature line. Take control of your destiny or someone else will. You can't change the economy. You can't change who is president or in congress until the next election, so quit bitching about what "government" is doing and start worrying about what you are doing.

And for the person that said that government always chooses the lowest bidder, while telling us to never use the lowest bidder, it ain't so. Most governments will qualify their bidders first. Most homeowners do not qualify their bidders. Its not a case of 'do as I say, not as I do', its more a case of, 'do some due diligence or get screwed'. Sounds like good advice to me.

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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