When And How Do You Get Information On Customer's Budget? - Marketing & Sales - Contractor Talk

When And How Do You Get Information On Customer's Budget?

 
Thread Tools Search this Thread Display Modes
Old 07-15-2009, 07:54 AM   #1
Custom Stuff
 
Mike(VA)'s Avatar
 
Trade: General Contractor - Custom Renovations
Join Date: Jan 2008
Location: Manassas, VA
Posts: 867
Rewards Points: 500

When And How Do You Get Information On Customer's Budget?


Some people are afraid to ask what their customer's budget is and some ask too late. When do you ask and how do you ask? It is definitely more critical to ascertain a customer's budget early on for larger jobs, but do you ask for every job?

The way I do it is this: as soon as I find out the basic scope of the project at the first lead call, I suggest a meeting to go over their project ideas, look at the property, and discuss their budget constraints. At the meeting, I do address budget, but not until close to the end of the meeting. I just ask if they have a budget in mind for this project and I also ask what they based this number on. Too many times I hear that their budget number is based on what Joe down the street paid for a similar project 3 years ago, that's what they have in equity in their house, or they saw a project like their's on HGTV and it said the job only cost 'this' much.

Problem is when you get customers who will not tell you either because they are afraid of you taking advantage of them or they just plain have no clue how much a job might cost. What do you do with these people?
__________________
__________________________________________________ ___________
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
Mike(VA) is offline  

Warning: The topics covered on this site include activities in which there exists the potential for serious injury or death. ContractorTalk.com DOES NOT guarantee the accuracy or completeness of any information contained on this site. Always use proper safety precaution and reference reliable outside sources before attempting any construction or remodeling task!

   

Advertisement

 

Old 07-15-2009, 08:07 AM   #2
Pro
 
J F's Avatar
 
Trade: Carpenter
Join Date: Dec 2005
Location: North of Atlanta
Posts: 9,058
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


During the first phone call at some point I would let them know part of the first meeting will be discussing budget. If someone won't discuss budget after meeting with you and discussing your qualifications etc (and seeing projects you've done similar to their's with some #'s for those projects)....probably not going to be a client of yours.

Advertisement

J F is offline  
Old 07-15-2009, 09:11 AM   #3
Pro
 
Mike Finley's Avatar
 
Trade: Bathroom Remodeling
Join Date: Apr 2004
Location: Littleton, Colorado
Posts: 14,078
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


Quote:
Originally Posted by Mike(VA) View Post
Problem is when you get customers who will not tell you either because they are afraid of you taking advantage of them or they just plain have no clue how much a job might cost. What do you do with these people?
Ignore it, and repeat the question.

That isn't why you are asking so why would you validate it?

Repeat the question over and over again until the tell you.
Mike Finley is offline  
The Following User Says Thank You to Mike Finley For This Useful Post:
wallmaxx (07-15-2009)
Sponsored Links
Advertisement
 
Old 07-15-2009, 10:36 AM   #4
Workin' Hard & Havin' Fun
 
BreyerConstruct's Avatar
 
Trade: Deck Designer/Builder
Join Date: May 2006
Location: Reading, PA
Posts: 1,763
Rewards Points: 1,000

Re: When And How Do You Get Information On Customer's Budget?


I've gotten a lot bolder about asking budget this year.
Last night they said they have no idea, but knew it would cost more than a few grand, but didn't want/need a 25k deck (even though that was closer to what they were talking about!).

So I said "Ok, so somewhere between 2k and 25k? I can work with that." They laughed, and we moved on to product selections.
I'll show them a few size and design options in the 6-15k range, and scale up or down from there based on their input.



Oh, and the 6k option might be "frame only".

~Matt
BreyerConstruct is offline  
Old 07-15-2009, 10:45 AM   #5
Professional Instigator
 
rbsremodeling's Avatar
 
Trade: Design Build Remodeling Contractor DC MD
Join Date: Nov 2007
Location: Washington, DC/ Maryland
Posts: 6,872
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


Charge for an estimate and design service like Mike has preached and I don't care what the budget is.
__________________

rbsremodeling is offline  
Old 07-15-2009, 10:58 AM   #6
Custom Stuff
 
Mike(VA)'s Avatar
 
Trade: General Contractor - Custom Renovations
Join Date: Jan 2008
Location: Manassas, VA
Posts: 867
Rewards Points: 500

Re: When And How Do You Get Information On Customer's Budget?


Sure, I could get some green folding money for the estimate, but it doesn't fully cover the cost. I want them to sign because the fit is right and I have designed a project that will work and is in their budget range. They don't tell me that all they have is $25K for a basement and I take their info and design one that costs $95K, there's a disconnect there big time. No way to salvage that one. Why waste the time?
__________________
__________________________________________________ ___________
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
Mike(VA) is offline  
Old 07-15-2009, 11:01 AM   #7
Professional Instigator
 
rbsremodeling's Avatar
 
Trade: Design Build Remodeling Contractor DC MD
Join Date: Nov 2007
Location: Washington, DC/ Maryland
Posts: 6,872
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


50-75 bucks and I give them a ball park/reality check. After the get up of the fllor they give me a real budget.

Then the design and construction is based on reality. Detailed estimate and scope of work and specs $500 and up
__________________

rbsremodeling is offline  
Old 07-15-2009, 11:05 AM   #8
Custom Stuff
 
Mike(VA)'s Avatar
 
Trade: General Contractor - Custom Renovations
Join Date: Jan 2008
Location: Manassas, VA
Posts: 867
Rewards Points: 500

Re: When And How Do You Get Information On Customer's Budget?


Well, that's what I am asking for is how do people get the numbers. Thanks.
__________________
__________________________________________________ ___________
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
Mike(VA) is offline  
Old 07-15-2009, 11:14 AM   #9
Pro
 
J F's Avatar
 
Trade: Carpenter
Join Date: Dec 2005
Location: North of Atlanta
Posts: 9,058
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


Ask....if they won't tell after doing all in the above posts (and won't pay your for design/estimating)...walk. You can't be afraid to walk.
J F is offline  
Old 07-15-2009, 04:27 PM   #10
Pro
 
Mike Finley's Avatar
 
Trade: Bathroom Remodeling
Join Date: Apr 2004
Location: Littleton, Colorado
Posts: 14,078
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


Quote:
Originally Posted by Mike(VA) View Post
Well, that's what I am asking for is how do people get the numbers. Thanks.
Ask them again. How hard is that? What are you scared of? I haven't ran into a customer yet who ever punched me in the face for asking them a question.

You ask them and anything they tell you other than their budget, just ask them again. You think that is hard or something?

So have you ever hired a professional remodeling company before?

No, we never have, you are the first person we have ever talked to ever.

Great, so you're in for a real treat. Now what type of budget have you guys considered for this project?

We have no idea, that's why we called you. We have never done this before and have no idea at all, not an inkling, not even a guess on where to start.

Great, you, what type of budget have you guys considered for this project?

Well, we were hoping to be around $10,000.00.

Great. Most of the projects like this that we do usually are in the range of $15,000-$25,000.00

Oh my! We had no idea.

No problem. $10,000 is certainly on the lower end of the scale. Should we see where we can cut corners as much as possible to see how close we can get to that number or is there some flexibility if it made sense.

Well, LOL, we were hoping to be around $10,000, but I told my husband he's a total idiot, tight wad and I'm spending whatever it takes.

Great!
Mike Finley is offline  
The Following 2 Users Say Thank You to Mike Finley For This Useful Post:
DavidBelcher (08-11-2017), Everend (02-09-2012)
Old 07-15-2009, 04:34 PM   #11
Certified Remodeler
 
silvertree's Avatar
 
Trade: Kitchen bath remodeler
Join Date: Jul 2007
Location: North Oaks,MN
Posts: 3,207
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


I feel strongly that asking for a budget is the smart and honest thing to do.

Now, I was at a remodeling site this week that had 10 things you never tell a contractor.
Like

1. How many bids you getting?
2. Have you talked to anyone else?
3. What is your budget? They went on to say if you give a budget then "we" know how much to charge you. Stupid-stupid-stupid!
silvertree is offline  
Old 07-15-2009, 04:37 PM   #12
Lack Of All Trades
 
Darwin's Avatar
 
Trade: Construction & Home Improvement Services
Join Date: Apr 2009
Location: Southeast Michigan
Posts: 1,232
Rewards Points: 500

Re: When And How Do You Get Information On Customer's Budget?


Mike Finley. This is where you shine at. Keep it coming, we're listenin' .
Darwin is offline  
Old 07-15-2009, 05:04 PM   #13
Professional Instigator
 
rbsremodeling's Avatar
 
Trade: Design Build Remodeling Contractor DC MD
Join Date: Nov 2007
Location: Washington, DC/ Maryland
Posts: 6,872
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


What good does asking for a budget and they have no clue what it cost?

If they don't have any idea, what are they going to say?

I tell them what it will cost not the other way around unless they are seasoned consumers.

How much is you budget hmmm 10k well its 15K and up.

Well you asked us what our budget was.

I did 2 estimates this week they both had bank write ups that were off by 80-100K so their budgets were still off.

They need my price not an assumption or someone else's price.

So what does asking their budget do if they have no clue about your price?
__________________


Last edited by rbsremodeling; 07-15-2009 at 05:18 PM.
rbsremodeling is offline  
Old 07-15-2009, 05:09 PM   #14
Certified Remodeler
 
silvertree's Avatar
 
Trade: Kitchen bath remodeler
Join Date: Jul 2007
Location: North Oaks,MN
Posts: 3,207
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


Rory, I disagree and will tell you why when I get back.
silvertree is offline  
Old 07-15-2009, 05:11 PM   #15
Professional Instigator
 
rbsremodeling's Avatar
 
Trade: Design Build Remodeling Contractor DC MD
Join Date: Nov 2007
Location: Washington, DC/ Maryland
Posts: 6,872
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


Quote:
Originally Posted by silvertree View Post
Rory, I disagree and will tell you why when I get back.
Just opened another beer I be waiting.
__________________

rbsremodeling is offline  
Old 07-15-2009, 05:18 PM   #16
Pro
 
Mike Finley's Avatar
 
Trade: Bathroom Remodeling
Join Date: Apr 2004
Location: Littleton, Colorado
Posts: 14,078
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


Quote:
Originally Posted by rbsremodeling View Post
So what does asking their budget do if they have no clue about your price?
In a 12x12 room I can design a $10,000 bathroom or a $100,000 bathrooom.
Mike Finley is offline  
Old 07-15-2009, 05:21 PM   #17
 
BobsLandscaping's Avatar
 
Join Date: May 2009
Posts: 846
Rewards Points: 500

Re: When And How Do You Get Information On Customer's Budget?


I find out when I run their credit how much I can finance them for. If it's a cash customer I ask. It's useless to do a landscape design they love, but can't afford.
BobsLandscaping is offline  
Old 07-15-2009, 05:26 PM   #18
Professional Instigator
 
rbsremodeling's Avatar
 
Trade: Design Build Remodeling Contractor DC MD
Join Date: Nov 2007
Location: Washington, DC/ Maryland
Posts: 6,872
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


Quote:
Originally Posted by Mike Finley View Post
In a 12x12 room I can design a $10,000 bathroom or a $100,000 bathrooom.
Exactly my point so until they give me a scope of work and I price it, their budget is mute.

Budgets are a guideline yes but I exceed budgets daily. Budgets sets limits in their minds I am going to spend 3ok on a bath.

Yeah ok that Sounds good till I get you in the showroom and show you the Toto Neorest 5000
__________________


Last edited by rbsremodeling; 07-15-2009 at 05:30 PM.
rbsremodeling is offline  
Old 07-15-2009, 05:29 PM   #19
Pro
 
Ed the Roofer's Avatar
 
Trade: Roofing Contractor
Join Date: Dec 2006
Location: NW Suburbs of Chicago
Posts: 7,182
Rewards Points: 2,062

Re: When And How Do You Get Information On Customer's Budget?


Rory does bring up a good point though, for arguements sake, or at least to open the discussion further with the home owner.

How many people here have read about some public project that had a pre-determined budget created from the architect, engineer, or some other entity?

Then, when the open bidding was disclosed, not even the lowest "Bidder" was at or under the designated budget.

I am sure that most home owners have read about a local community project that had to be brought back to be redesigned to get to the budget amount designated, even if the firm creating the budget charges 25% of the amount of the entire contracted work amount.

So, getting "Their" budget at least opens up the wiggle room for discussion to get to the true final number, which is the contractors costs.

Use that opening to create a dialogue so that they drop down their guard and open up a bit. At least now you are making headway.

I'm going to try that tonight with my upcoming appointment to see how it goes over.

Ed
Ed the Roofer is offline  
Old 07-15-2009, 05:33 PM   #20
Professional Instigator
 
rbsremodeling's Avatar
 
Trade: Design Build Remodeling Contractor DC MD
Join Date: Nov 2007
Location: Washington, DC/ Maryland
Posts: 6,872
Rewards Points: 2,000

Re: When And How Do You Get Information On Customer's Budget?


I have found that asking for budget puts most customers on their guard. Very few people can ask tactfully and correctly and get the true numbers.

They will never give you their actual numbers anyone. Take their spoken budget and at 30%

Let them drive the price and keep them informed and educated through out the process.

Advertisement

__________________

rbsremodeling is offline  


Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes Rate This Thread
Rate This Thread:

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Join Now... It's Fast and FREE!

I am a professional contractor
I am a DIY Homeowner
Drywall Talk is for
PROFESSIONAL CONTRACTORS ONLY!

At DrywallTalk.com we cater exlusivly to professional contractors who make their living as a contractor. Knowing that many homeowners and DIYers are looking for a community to call home, we've created www.DIYChatroom.com DIY Chatroom is full of helpful advices and perfect for DIY homeowners.

Redirecing in 10 seconds
No Thanks
terms of service

Already Have an Account?