The High Cost Of Low Prices

dfwhomeremodele

I wanted to get some comments from everyone on this topic. I think that the fact that homeowners have been conditioned by companies such as Wal-Mart that they should get everything for the cheapest price. This has had a direct coralation to the remodeling industry. This is also why so many of our jobs are being sent over seas. WalMart got so big that they told the manufactures how nuch they were going to pay them for there own products. So in order for the manufacturers in order to meet the pricing of Walmart sent there manufacturing jobs over seas. Other industries have done the same thing and now we are loosing our jobs to cheaper labor over seas. This is what I call The High Cost Of Low Prices. Now this is spilling over to the remodeling industries. So now people are looking for work on there home like they are shopping at WalMart. Maybe they should realize this is the reason for shoddy work. Business' can not pay the seasoned veterans in the field the price they deserve because homeowners want the work done for nothing. Then they complain when work is done not up to standards or it takes longer to finish a job then they thought. We are selling this countries future for low prices. My wife has worked for a computer company for 21 1/2 years. She is in the top 30 in her field of computer programming out of thousands and she is loosing her job at the end of June. SURPRISE, SURPRISE, SURPRISE, her job is going to india. Any thoughts.

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Tim Bankes
Phone 214-288-4178
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747

Ross perot said back years ago when he ran for president. Free trade agreements would mean a sucking sound of jobs leaving this country. I'm proud to say I voted for big Ross it to bad other people blew him off.

dfwhomeremodele

The company Ross Perot started and made him a billionare is the company my wife works for.

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DFW Home Remodelers
Tim Bankes
Phone 214-288-4178
Fax 469-287-2373
www.dfwhomeremodelers.com

Mike Finley

I don't see the connection between Wal-Mart and the remodeling industry.

Glasshousebltr

Economics Mikey, Walfart sends the jobs out, unemployed flood our trades, cost and quality dive.

Bob

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Bob

Teetorbilt

Mike, he is postulating the theory that the cheaper goods provided by WallyWorld,et al., has changed the thought processes of the consumer. To a degree he could be right.

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Mike Finley

...Then I think the high costs of gasoline prices that consumers have been forced to pay has created remodeling customers that expect higher prices...

...or I think the skyrocketing cost of housing prices has created remodeling customers that expect higher prices...

... or I think the skyrocketing costs of medical insurance plans has created remodeling customer that expect higher prices...

???


I just don't see the connection between Wal-mart and the remodeling industry in our customers.

I think you might make a better connection between the big box stores like Home Depot and Lowes polluting customers minds with a combination of their $5.00 tile installation prices and the do it yourself tile installation seminars on Saturdays and selections of cheap, crappy close out tile for .99 cents a square foot that a contractor charging $12.00 a square foot is gouging them.

slickshift

That is one hell of a statement right there

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Originally Posted by ModernStyle I have never used this crap before and I pray to the paint gods that I never have to use it again, I would rather use Behr

dfwhomeremodele

The point is, walmart started this cheaper price spiral and the big box stores like HD and Lowes and others have fallen into place. It used to be that you bought your merchandise from a store owner and you got better service. Now you get no service and dirt cheap products. So now the mentality of the consumer is lower quality and cheaper prices. So now when we have a quality product and a quality service to offer, they don't want to pay for it. So we are forced to lower our prices or limit our customer base to the smaller portion of consumers that actually will pay for quality. This portion of consumers is shrinking because all of our tech jobs and manufacturing jobs are being sent over seas. So the person who goes out and gets a degree in the tech or computer industries find themselves with a degree and no job. So they start there own remodeling business and under cut everyone else to get the job, thus lower the price of remodeling for the people who have been there for many years. Not to mention the people coming over hear to work and working dirt cheap. Hope this clarifies my point.

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Tim Bankes
Phone 214-288-4178
Fax 469-287-2373
www.dfwhomeremodelers.com

slickshift

Not that I don't agree that the places mentioned are contributing to the effect you are referring to, I do

But the fact is the consumers are the ones who drive it
They are the ones who agreed with the Wal*Mart philosophy of Consumer Perceived Value and purchased their de-spec'd sneakers and house fans there

If consumers decided service and quality merch and service was more important than cheap jeans back in 1982 and stopped shopping at Wal*Mart back then, it would not be the force it is now

I think the statement "walmart started this cheaper price spiral" is incorrect

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Originally Posted by ModernStyle I have never used this crap before and I pray to the paint gods that I never have to use it again, I would rather use Behr

Bone Saw

I'm guessing the point of what DF was getting at was just using the "wallmart" analogy as a metaphor for the for the consumer mentality as a whole, in addition, you could also group all mega retailers into contributing to this Phenomenon, which plays into the the very same thing that is happening the remodeling industry from several angles, Tv, big box stores, and trades flooded with unskilled, illigitimate operators who were probably unable to stay gainfully employed and/or were previously displaced from other job markets and/or are illegal. Vicious cycle. I couldn't agree more with his gripe, but I think as 747 said, it is "free trade" driving every thing down. Inversley, if find it hard to understand why "consumers" seem to have no problem dropping $30,000+ for a mediocre automobile, $3/gal for fuel, ever increasing insurance premiums, $4/cup coffee or $300+ for a purse??? In addition to that, has anyone noticed the skyrocketing costs of just about all goods and services across the board, namely building materials, ultimately if the consumer drives the economy and raw materials seem to be able to maintain proportionally with inflation, theoretically we are all doomed

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slickshift

Trying to understand people's priorities can be very confusing

My sister "couldn't afford" to replace the bald tires on her vehicle
"They're almost $100 each"
But she spent $2100 on Christmas presents for her boyfriend and buys $6 loaves of bread at the gourmet shop

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Originally Posted by ModernStyle I have never used this crap before and I pray to the paint gods that I never have to use it again, I would rather use Behr

slickshift

I understand
I agree with the point
I think it makes it sound like blaming Wal*Mart when it's phrased that way, when Wal*Mart didn't/doesn't force anyone to shop there
They certainly contribute to the attitude, loads, they feed and nurture it, exploit it to the max
But ultimately the consumers are to blame

How does the saying go?

"Someone can't take advantage of you, unless you let them"

I think someone can't sell you de-spec'd shoddy products cheap, unless you let them

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Originally Posted by ModernStyle I have never used this crap before and I pray to the paint gods that I never have to use it again, I would rather use Behr

Mike Finley

Priorities and Value. Your sister doesn't see the value of spending $400 on tires (goes on car, can't even see them while driving!) but sees the value of a $6.00 loaf of bread (yummy - goes into the tummy) I know how your sister is thinking, I just had to fork over $1800 for window blinds for 3 windows. That took a bit to come to terms with, but I have no problem spending $30 on a soft sided case to store a tool in while I throw away the factory case that came with it because it is too inconvenient to mess with trying to get the tool to fit in the too small factory case the 15 times a year I will use it.
Maybe I am just missing it, but I don't see Wal-mart influencing remodeling customers. VALUE - it's all about perceived value.

I have a customer who sees $6.00 sq ft porcelain tile as too expensive. (customer lives in 200K home) They don't see the value of it. I have another customer who see $4.00 ceramic tile as too cheap, they don't see the value of it, not when they can get a beautiful porcelain tile that they like for $7.00 sq ft. (They live in 800k home)

People who buy a used 1988 plymouth voyager mini van aren't going to be taking it to a aftermarket dealer and installing a $400 dvd system for the kids. Besides they won't be able to get an appointment, because the aftermarket shop is flooded with customers who bought 2006 Yukons and Denalis who are having $3000 rims put on.

I know you don't want to hear it, but like a broken record - seek out the customer base you want to work with. If you're in an area surrounded by low income customers then so be it, that's your customer base, change your business model, you are swimming up stream to do premium work for them, they can't afford it. I really just don't see Wal-mart as the root of your problem, I see you being frustrated because your customer base doesn't have the per family income to support the type of work you want to do.

-- Does anybody know people who refuse to shop at Wal-mart because they can't stand the place? They choose to shop at Target because they see Wal-mart as low class, full of riff-raff, sh!tty service and losers running around. I know lots of people like that, they do exist, they avoid Wal-mart like the plague. You might guess, they also make excellent customers.

dfwhomeremodele

[QUOTE -- Does anybody know people who refuse to shop at Wal-mart because they can't stand the place? They choose to shop at Target because they see Wal-mart as low class, full of riff-raff, sh!tty service and losers running around. I know lots of people like that, they do exist, they avoid Wal-mart like the plague. You might guess, they also make excellent customers. [/QUOTE]


Mike

Maybe I should not single out WALMART, but I have come to distaste that company since the old man died. The point again is because we are loosing our higher paying jobs to other countries we are loosing a segment of wealth in this country. The margin between rich and poor is getting further apart and the poor are the ones increasing in size. So this leaves less people with money to spend on our industry is all I am saying

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DFW Home Remodelers
Tim Bankes
Phone 214-288-4178
Fax 469-287-2373
www.dfwhomeremodelers.com

dfwhomeremodele

Forgot to mention that I would rather pay a higher price somewhere else than shop at Walmart. I refuse to shop there. I would rather go to Dillards and by a shirt than go to you know who.

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DFW Home Remodelers
Tim Bankes
Phone 214-288-4178
Fax 469-287-2373
www.dfwhomeremodelers.com

Floorwizard

Good lord! Isn't that what this thread is about? How to deal with it?

If so, then that statement is perfect.

I work with mostly very wealthy. Those people know who to pay less and who to pay more.
they go to Walmart for some things, and Nordstroms for another.
they buy cheap in things they know they can go cheap, not because they buy ALL things cheap.
Those are the clients you need to work with to combat the low ballers.

there are also qualifying questions to help find out who these people are.

the sales area in www.inctalk.com might help you

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Melissa

Yep! Right here! And, unfortunately they built one right stinkin by our house, just about in walking distance, but we don't go there.

dfwhomeremodele, I'm really sorry about your wife's job. That sucks! I can't stand outsourcing- especially when you call a company and it's so obvious, because of the delayed response, and heavy accents. Sounds like the company got greedy. I mean it made Perot a billionare then you'd think they could afford to pay American wages.