Customer Wants My "Bottom Dollar Price"

AlphaLexman

Hello I'm new here.

Recently a customer asked for a bid, I submitted my proposal, they came back and wanted my "Bottom Dollar Price."

Admittedly, the customer was an apartment complex on a tight budget, the work they asked me to do was some siding replacement before the entire property was to be repainted. They did not have an actual scope of work either. I was told to walk the complex and determine what and how much needed replaced before the repaint. I spoke with the manager and she told me "The owner does not want any surprises when he is paying bills."


Obviously I bid everything I found to be defective, and it was too high.


So, I go back to the apartment manager, and basically tell her I can do less work for less money (maybe caulk some boards instead of replace them.) The she got mad and told me she was going to two more bids, which I though was standard anyway!


So all the bids were compared to linear feet of siding and trim to price per LF. I talked to the maintenance man, and he said one bid was really high and that mine and another were very close. One contractor had over 15K lf of siding, I had about 9K lf of siding and another had around 6K lf of siding, and all three of us were too high!



The problem here is this -- I would rather hand the manager a hundred dollar bill than take a job that will lose ANY money. I can't seem to convince her that I will not do $30K worth of work for $12K, I will do $12 worth of work for $12K. In other words, she will get what she pays for.


Am I setting myself up for disaster by taking this job or will I be able to come out making everybody happy? (me making money and the apartment's getting minimal wood replacement)?


FYI: The apartment complex has agreed to buy the lumber (no nails, etc.) and the siding is a custom 8" dutch lap cedar (expensive)

griz

There have been enough red flags raised for you to back out of this project. This is rather typical MO for apartment/rental unit owners & managers. If you did the job for free they would want a discount.

woodtradesman

Red flags galore, runaway.

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AlphaLexman

Yeah, I'm not chasing this job hard core, just trying to get some downtime filled. If I don't get the job I won't lose any sleep!

MBS

Why are you even thinking about this one any more? Either you are in business to make money or your not. Its that simple. You gave them your price, they don't want to pay it. How clear does it have to be? Why would you take on a job knowing up front that it doesn't pay?

They way they are acting now, before any work is done is only a sample of how they will act when you want to get paid. Walk away and let someone else get burned in this mess.

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shed builder

Agreed, I'm not a remodeling guy but this customer already sounds like one big headache. It looks like the guy who bid high might of done that for a reason. Probably bid high just to put up with future problems in case he landed the job. I get people all the time trying to get my work down to a bottom dollar figure. I just send those people on to my competitors. Maybe just let this one go? It's not winter yet so a good paying customer who appreciates your work is probably just around the corner.

480sparky

Three choices:

1. "That's my price... take it or leave it".
2. "Well, let's go over it and see what you want to eliminate in order to reduce the price".
3. Run, Forrest, Run!

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AlphaLexman

Thanks for confirming my gut feelings here. I really didn't want to take the risks associated on this one. I think now, even if I'm awarded the job I will turn it down.

Warren

I consider it bad policy to ever lower a price. On occasion I have thrown in some extra work in order to land a job, but I will not adjust my price. When you lower your price, it makes it appear that you intentionally bid it high and are willing to negotiate it. This is our livelihood folks, not a garage sale!!

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Inner10

I agree with Warren....if you lower the price that means you were screwing them to begin with...explain that to them.

I have thrown in an extra run or two here and there but never dropped my numbers.

knucklehead

They all want the bottom dollar. If you give in now, it will never end

Greg Di

This thread needs to be closed because all you're going to read are 400 guys telling you to RUN and don't waste your time until someone comes along and diverts the thread with an RRP mention or Warner comes in with the Festool talk.

Then the thread might have a point.

If you took the time to write the post, you aren't asking for advice, because you already know you should run. You are looking for reassurance.

It's OK grasshopper, let this job go.

There...you heard it. Now go find another client!

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cwatbay

I like what Warren said about a little extra work but no lowering of the price. He absolutely correct, because if you lower the price, it will never be enough and the client thinks that you overpriced it to begin with.

Someone has a Run Forest Run graphic which would be good for this post.

A long time ago I tried to satisfy people like this, and, every single freakin time, there is no satisfying them.

I have worked with HOA's and Property Managers. Some are ok, the rest are cheap asses with an attitude -- like the example here.

Many many years ago I learned about the 80/20 rule. In sales it means that 20% of your clients will provide 80% of your income. I think this still applies.

For property managers and HOA's -- 80% want a cheap ass price, 20% want a fair price and good quality (the 20% are those that have learned their lesson in the past).

In contracting bids, I see it as 20% of your clients go with the bid and want quality work, 80% want a cheap price and think they are going to get quality work.

In a global sense, 80% of the people on the planet are drooling morons, 20% are trying to be part of the majority.

AlphaLexman

I haven't lowered my price on paper, just told the manager I would do less work for less money... But I agree with the general population here -- is RUN!

I guess I was trying to teach her how I make money and refuse to lose money...

I am not a good teacher, but a very good student, and know when to get out.

MarkyMark

It sounds to me like this customer is going to be unhappy regardless of who gets the job, or what the price is.

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knucklehead

I think the mods are kinda quick on the trigger here. Let us have some fun once in a while.

oldfrt

I had a similar request last fall for
an apartment complex.
There was no house wrap at all on
these places and some of the siding was
actually falling off.
It was hard to determine how much
needed replacement from a visual inspection.
A lot of the nails had backed out and there had to
be a lot of re-nailing of even the good claps;
I think a lot of studs were missed.
I couldn't see them being satisfied with the end product if I did it their way,and that may be a reason for not getting paid.

Truth is,on a job like this it's hard to walk away
after finishing and feel good about how it was
approached when your hands are tied with a money
pinch.
I walked away refusing to compromise on
price/quality.

Here's a pic of the finished product after
they found someone to go cheap.
Notice the not so straight lines in the claps.

Attached Thumbnails

 

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Aggie67

My 2 cents:

I've performed work for prop managers, and some have been great, some have been real jerks.

Also, the best prop managers I did work for have been the bigger corporations. The mom and pops just want to keep the walls up and the roof propped up. For them, any other fix or improvement will die at the quote stage without the intervention of the city, state, or the health department.

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User60231

Two things I have always found to be strange with this topic;

1. How people find it justifiable or appropriate in setting a value to any contractor's time/skill/efforts. In other words dictating what our time is worth. It tells me we are viewed as lower-class citizens to them.

2. Whenever things are weird on the front end of a job, then it's probably going to be just a weird (or worse) on the back end (getting paid that last check).

Btw, I agree with others here to run if you can.

TBFGhost

I have done ALOT of commerical work...small to mid sized jobs...and I tell you what you have posted is exactly what they want. They don't care how it looks, they don't care if it only hold up for a few years, they want it fixed now and fixed cheap..... I don't know why, they are only shooting themselfs in the foot...

I have a very expensive building a few exits down from me...the hardi board is blowing off this place. It was nailed in with a roofing nailer...to this 1/4" MDF type stuff that is applied over metal studs....needless to say the nails are just falling out left and right, with the high winds in the this area a hand full of siding blows off each year. I get a call from a GC and he says go buy more siding, paint it and hang it.... so I do. I ended up screwing the the siding b/c I don't want mine falling off and hitting a car or worse.

This same building had three large cupolas on the roof...they were all rotting and I was tasked with replaced the rot. Upon inspection I found they were made of metal studs and plywood and some moldings... The ply was delaminiating like crazy. I made a push the switch to Azek. I got a firm no, so I replaced the plywood with plywood...


You can also go the roofing section and see that roof leak I was tasked with....

Its not pretty work, but it does earn money if you know who your working for. You need to watch out for people who want good work for cheap....the commerical work I do is people looking for cheap work and that is what they expect... The Cupolas only had to look white and not falling apart from the parking lot...which was 3 stories down... If anyone goes on that roof tho...

Its the norm for some of these places...