Deal Or No Deal

MarcoPaints

I'm new and just starting out as a painting contractor among other things. I found a site that will provide me leads free of charge, but wants 20% of anything I close through them. Now sure I can tack on 20% to my estimates, and risk losing the jobs, but I wouldn't get the chance on these jobs anyway without them. Has anyone used something like this before? Should I look for a better deal? 10% I'd feel better about. 20% and I wanted to see if anyone else used something similar or had any success.

Darwin

Are you tryina sell sumpthin"?

strathd

Use the search function dude !!!!!
We'll learn ya !!!!!

MarcoPaints

Tried searching but didn't see anything for this. I tried "lead percent job" and some other things, but didn't see anything come back for what I was looking for. I'll keep digging (searching). Thanks

NAV

20% They should provide sold jobs.

MarcoPaints

Thanks Nav, and go Cavs. (I see you're from Cleveland).

On this note, I'm not sure what it could hurt, especially if I can get it at 10%. But I'm not sure how they manage it. I have to go out and estimate it and then tell them the number I come up with, and they tell the customer and close the deal. I don't like that too much either, but if I can try to close it during the estimate.

DavidNTX

If they tack the 20% onto the number you turn in and sell it then it might be worth it. You would still be getting the amount you wanted.

I'm sure they can't guarantee closing 100% of the jobs that you give a bid on. I would ask for some kind of bid to close ratio they generally get.

When you turn in a bid to them be sure and give them a detailed scope of work that they can in turn give to the owner. One part of this that would concern me would be them answering questions that the owner may have.

Also be sure who is in charge of collections and be sure that your money is safe.

My first thought when I saw this was "what a rip" but after seeing they do the close, it might be worth it. It sure wouldn't hurt trying 1 or 2 of them to see.

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Mike(VA)

20% of most guys' jobs is their overhead and profit. You want to give that up? Also, if you took 20% percent of every job you DO get by yourself and put it into advertising, you won't need them. I think there are too many what-ifs with this. For example, what if they are selling in a way you don't like since it all reflects on your company? You can't build a decent brand with someone else's process.

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I EXPECT THAT SOMEDAY I WILL SEE THE FRUITS OF MY LABOR. IS IT SOMEDAY YET?
Clifton, Great Falls, McLean, Fairfax Station, Manassas, Virginia Renovation Contractor

DavidNTX

I would never take 20% off of my price. Only if they tack it onto what I give them AND close the deal would it be worth it.

I too worry about the fact you lose control over the closing aspect but it sure wouldn't hurt anything to give it a try. At least for a job or 2.

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sparehair

if the salesman isn't responsible for the cost of performing the work then they will give the customer everything they ask for free in order to close the deal.

iow's subby submits bid for floor install 800 sq feet labor and materials. salesman talks to homeowner. homeowner doesn't want to remove trim. sure we'll do that. and reinstall it? sure. and install in 200 square feet of closets? sure. do I get milk and cookies when you're done? you betcha.

so now you, the subby, is eating the extra materials, the extra labor and assuming all of the risk if there's an accident or an unhappy customer. the salesman closed the deal, get's his 20% and it didn't cost him a dime extra.

DavidNTX

They can promise all they want but if the contract includes the detailed scope of work mentioned above, that is all that is needed. I wouldn't sign a contract that didn't include a scope of work.

General contractors act as salesmen everyday selling jobs that are comprised of subcontractors. They can promise anything they want but if they promise something over and above my scope of work, someone will have to pay for it.

Subcontractor submits bid to install 800 SF with a detailed scope of work. Salesman offers the world to the owner. Contract between owner and salesman offers the world(install 800 SF plus remove and reinstall trim plus add 200 SF more to the closets). Contract between salesman and subcontractor is for installation of 800 SF of floor.

If the subcontractor signs a contract to do more than what he bid then he should eat the work. If the salesman offers more than the subcontractor did on a contract, he is responsible for the extra work.

Contracts mean something. It would be no different for a salesman to come in at the last minute and add work than it would be for the owner to do the same thing. More work has to be compensated. That is the enitre reason for a detailed scope of work and a signed contract. Those will stand up in court and chances are the salesman knows it. If the salesman doesn't know it then getting stuck paying for something not bid will be a good education for him.

There are a thousand "what ifs" for any job. What if the owner dies? What if the salesman dies right after you finish the job but before you collect the money? What if the salesman dies after he collects my money but before he pays me.

Contractors have legal protection for all of these things. If you are not paid for any reason for work you have done you can file a lien against the property where you did the work. It may take awhile to get your money but before they can sell the house, refinance it, change ownership or name on the title, any of this will require relieving all liens and debts againt the house.

A detailed scope of work and a signed contract will also stand up if you have to file a lien against the home where the work is performed. I would never think that after giving someone a bid they can then write a scope of work or change the scope of work that I submitted without talking to me first about pricing changes.

Milk and cookies have nothing to do with this.

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vandyandsons

i bet they want their 20% off the top.

what if the job goes bad? or you tanked the bid? then you are out not only what it cost you, but another 20% on top of that.

for me: no deal

now I have a guy that feeds me leads, i price the jobs and tack on 10% for him. but he is a friend and if a job went bad on me, he would give me a break for sure.
I have another guy who is always talking me up to his friends and in turn I give him a break when I work for him.

DavidC

It sounds to me like you go out and sell at whatever price and they get 20% off the top for providing the "opportunity".

Questions I would ask, 20% of the contract or 20% of the receipts? and is there a cap limit?

Contracts and receipts are often different for various reasons. And 20% wouldn't mean a great deal on small jobs but a large job it can get huge. A handyman type of service compared to a large deck or addition for example. 20% up to a set dollar amount limit would help take the sting out.

In case you missed it, reread Mike(VA)'s response and think about it awhile.

Good Luck
Dave

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www.CookContractingLLC.com

Wolfgang

Do they happen to be based out of Nigeria? Personally I wouldnt even think of using one of those companies.