How Do You Handle Volume Discounts?

Mike Finley

I would too. But who the hell are we kidding? If every contractor had that figured out there wouldn't be so many bust ass broke contractors running around low-balling everybody. That's what I keep having to repeat, the reality outside our doors is totally different then the best of the world ideas that float around contractortalk.com.

I would say yes they are. When a setter is busy for 6 days working 10 hours a day then has 3 days off, then works 3 four hour days, then nothing for 4 days, then takes a job over the weekend for 12 hours, then has nothing for 3 days, then gets a back splash for 6 hours then no work for 5 days, then gets a job for 12 hours over 3 days....

Total it up and he has 30 billable hours over 14 days or 60 billable hours over 14 days at a reduced rate, he is making more in the latter. I'm not saying it is good or bad, just a matter of math. Sure it's better to have 80 hours at your top rate over 14 days, that's a no-brainer.

Like I've said I don't know what the right or wrong is or the ethics or even if I should care. I'm not even talking about asking my current setters to take a cut.

All I'm talking about is market economics. If the market says that if I find new setters and do it by offering a larger volume of work if they return with rates lower than I am paying now without me even asking for them to reduce the rate - then volume has an influence on rates. If they return me the same rates then volume has no influence. The market is the market, I'm a buyer they are a seller. Is it my job to make sure they run their businesses at top profit margins? Where does it end, do you follow them home and tell them they can't stop at the bar and spend the money they should be saving for their retirement?

mdshunk

Why did you ask then, if you already have the experiment figured out?

tkle

It's your job to get the best price as long as the guality is the same.My job is to avoid playing those games

mahlere

Time to rework that quality control



Sorry, couldn't resist

boman47k

I'm just reading these posts in this forum to glean as much business knowledge as possible, but do you mean like Mike is doing now. He's getting quantity discounts already and is asking for even more from the subs not wanting to split with anyone. Why not split it with some of the 80 per centers or the customer even and keep quality and volume up. Seems to me he will be making more income in the "Quantity" of jobs this new endeavor should bring in.

POOLMANinCT

dont ask or mention a discount.. if your ggrowing raise your end prices and keep a bigger slice..

these guys been a cornerstone of you biz from the get go-...

why risk experimenting w/ a new crew.. consider yourself lucky to have built a sloid team from the get go.. im sure you know how many d-bags you will have to go through to find a crew like you have built your biz w.
ray

dirt diggler

agreed

especially do not tell your customer that you're getting a discount

KEEP IT. . .

you all --- i swear, you gotta earn your money 3x-over anyways, why not catch a break when you can.

dumplin1078

Amen brother! Preach on!

__________________
"I hate to tell you this, but you're a man. You're going to spend your life gettin' up one more time than you get knocked down." John Wayne

BuilderOne

so what happened?

boman47k

Bump