Contractor Discounts

Mark

What are you guys getting for a contractor discount..... 5, 10, 15% ? Do you have to beg for it in the end or are you happy with your prices. Am also wondering what your doing with the discount, do you pass it on to the customer...... or considerit profit for the job ?

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Mark

www.benmoorestore.com

Grumpy

Since I am a contractor when I work as a sub contractor I give ~5%. If I have a good feeling about the General and the job I might give him a good discount just to WOW him over.

I think on purchases 5% is good. We get 25-45% from our window supplier... but then again they give all their contractor's 25-45.

Floorwizard

Generally, in the floor covering industry it 10 - 15%.

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"in 20 years you will regret more what you did not do than what you did"

TwoTrees

My home paint store is Sherwin Williams. I am not exactly sure what my discount is. Originally the manager asked what paint I was planning on using the most. I like Super Paint and use it all the time. I get 5gallons of satin interior for $75. I consider it a premium wall paint and like it as well or better than B. Moores Aquavelvet. The B. Moore dealers here don't really give contractors much of a break, I think ten percent off retail. As a result the 5s of Aquavelvet are over $120. I only use it if the customer insists or has the color picked out. I give customer's my price for SW. And charge the diff for BMoore. Paint is such a small part of my pricing scheme as I am strictly res. repaint, interiors mostly, restore old windows and sashes as well, but don't burn alot of paint up in the course of a day.

Mark

At our store we typically do 20 to our bigger contractors on paint and 15 on sundries. What I find amazing is that most of them pass this saving right onto the customer instead of considering it profit. I mean they have to pick up the paint at the store and carry it on their account so why do that for nothing. I have met contractors who will consider a store dicount theirs and then add another 20 above retail for a materials profit to the customer, and that still would not cover anyones down time for running to the paint store. What are your thoughts ?

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Mark

www.benmoorestore.com

Grumpy

Painter A is the same as Painter B but painter B is cheaper. Most home owners choose painter B, unless painter A is family.

When our suppliers have clearance sales we pass the savings to our customers. The price of delivery or pickup is figured into our labor.

If all paint suppliers give a discount, and your the only one who doesnt pass it on, your going to be higher than everyone else (Which isn't always a bad thing). The guys bidding low and bidding to win the job.

hatchet

This thread reminded me of a bit of wisdom that I learned from my father. When times are rough you can't make mistakes in estimating. The ultimate goal is to bid for each and every nut, bolt, stud, etc on the job... only once. If you count one twice it could mean losing the bid.
So I would agree that i would pass the saving onto the client. Another thing that can be done when dealing with very large projects where maybe the amount of the discount can not be figured out is bid it as a cost plus a fee. Fix the fee amount in the contract and then incentivize them to save money with a shared savings clause. So if they actually do the work cheaper or more expensive they don't receive more or less fee - but if they build the project cheaper they will receive a portion of the remainder.

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Rich
WIT Construction Co.
Superior MT Contractor

Mark

Its sounds like your in a market driven by price and sold to the lowest bidder. If your doing residential repaints especially you have an ideal opportunity to raise the bar and raise your price. One or two man operations need not be driving around in 10 year old cars and contemplating wether or not they can afford business cards. Never let price drive your company or it will be a short trip.

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Mark

www.benmoorestore.com

Grumpy

For your customers who have accounts, consider discounts for early payment.

I know my boss get's frantic if he has only a few days left to get his dicsount. "If I get my check to them today, I save $200!"

Nathan

I'm used to getting about 10% off of the product.

I think a lot of contractors pass on the savings to their customers because they like to show that they can get the product cheaper than they can. Its a mind game really... You make up the costs somewhere else.

-Nathan

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Nathan

"He is no fool who gives what he cannot keep to gain that which he cannot lose." - Jim Elliot

Grumpy

I was explaining this to my boss the other day. I showed him my original quote then the invoice. He was shocked. I used the "extras" to make the profit.

The bonus, when it comes to profit, is that the customer isn't going to price shop if you talk him into a sky light after you tear off his roof. I call it "would you like fries with that?" and marketeers call it "upselling".

Start out with a low price and hope to god that you can upsell for profit.

sumpen

I get about 10% off, depends on the item. It's already set up on the register when I purchase paint, no begging.

I don’t do T&M, so the cost of paint is figured into the square footage of area to be painted. I do NOT pass along the savings when figuring; I leave it at the retail price as a markup for the cost of handling the paint (pickup & delivery).

Floorwizard

I couldn't do that or I would starve!
The flooring business is different that's for sure.
I need to start high, because its really easy to work down than up.

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"in 20 years you will regret more what you did not do than what you did"

Speedy Petey

Although I don't do the paint thing, any discount I get I mark up to roughly actual retail. Basically what the customer would have paid if they picked it up. I too agree that pick up, delivery and your time is worth something.

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Grumpy

I agree pickup and delivery is all something you should be compensated for. We have a different estimating system I guess. We don't mark up our material at all.

Material(including delivery charges)+labor(including time for pickup)+profit=what you pay

My brother who works in HVAC is instructed by his bosses to mark up all materials 15% which isnt accurate. What if the supplier is next door? What if the supplier is 5 towns over?

sumpen

Actually, Mr. Grump, you are marking it up, but you’re being a heck of a lot more accurate about it, which is smart.

In painting, the materials are such a small part of the job, I kinda just let the difference between my costs and retail make up the cost of handling. That’s OK on the lager stuff, but on the small stuff, say an interior room of some kind, I probably should be doubling my cost of the paint. It cost me about the same to handle 20 gallons as it does to handle two.

Certainly something to consider…

Mark

The bigger contractors I deal with mark up product 10 + over retail. Even the GC's on new construction and commercial add 10 + 5 onto subcontractors prices on all jobs. This is profit and no one should be ashamed of that, you are all out running a business and zero profit = zero growth. Keep in mind you should be making money as soon as you leave your driveway in the morning and not when you actually pick up a brush. If anyone here is low-balling to get work they should step back and figure out why its happening, identify what makes you a preferred choice to the customer and put the spin on that because most people don't call a painter for his low price, they are looking for quality, trust, and a good experience. Enough rambling, I should have made this another string maybe ?? Hope all the US guys are having a great thanksgiving this week.....

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Mark

www.benmoorestore.com

rocco

hey thats a good question and one I was going to ask myself. In my humble opinion I think the dealer is offering the discount on the paint for ME and not my customer. I am in the store buying their paint on a weekly basis so I take it as they are offering ME the discount which I accept as the dealer thanking me for continuing to use their paint. I realize they dont have to give me a discount but I think many places offer discounts when you buy in bulk. I dont pass the discount on to my customer, not saying I'm right, it's just my opinion.

Glasshousebltr

Rocco, I remember back when I was a boy, I had to walk 10.........well as long as we're reminiscing.

2003 Rocco....this thread is from 2003.

Bob

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Bob

Tom Rohland

Rocco,

Thanks for responding to this thread...................even though it was apparently declared off limits...................... due to time constraints?????

LOL

Anyway, I use Sherwin Williams products 50-75% of the time and get a very fair discount.

I always markup my paint, sundries, etc. no matter where it's purchased.

Time is money anyway way you look at it.

And I need to be paid for my time.

By the way, I just received a letter from the President & General Manager of the Southeastern Division and he states:

"Effective October 18, 2005, we (SW) will be increasing our prices............."

Anyone else receive this letter?

Well, the only thing I can do is pass it on to my customer.


Tom
Ranger Painting & Pressure Cleaning, Inc.


PS Rocco,

Thanks again for returning this thread to the front lines!

Perfect timing!