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A contractor should not be looking for the going rate. You should instead analize your business ie: local market conditions, overhead and production rates to determine what you should be charging. Under cutting another contractor by a few cents a sq ft to get into a market is not a win-win for you or the industry as a whole. Remember, if you are not making a profit you are not building a business.... your creating employment for yourself.
 

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Knowing the going rate is important really. Yes your price should be based on your own overhead and expenses but the going rate will let you know if your too high, and you may need to restructure. Knowing the going rate will tell you if you are too low and under bidding yourself.
 

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So what you mean is he should adjust his overhead and structure to fit a target price instead of perhaps adjusting his marketing and selling skills to get the price he needs in order to make a healthy profit ? There will always be low-ballers, they come and go each day because they are not making money..... get to know your competition, don't become them.


Grumpy said:
Knowing the going rate is important really. Yes your price should be based on your own overhead and expenses but the going rate will let you know if your too high, and you may need to restructure. Knowing the going rate will tell you if you are too low and under bidding yourself.
 

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I think grumps right, you have to adjust to the market, and your competition is a large part of your market demographics. If you can't adjust you might find yourself at home a lot.
Bob
 

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Yes Mark in a way. If his overhead is way higher than anyone else he will lose jobs on price alone. If his overhead is way low and he is the lowest bid, he might as well raise his price a little bit and make more profit.

Yes Marketing and selling is very important. Infact I would say marketing and selling is AS important as being able to bid but what is also equally as important is knowing your compitition. I know if I am bidding against various companies I can raise my price because they charge an arm and a leg, and sometimes a few fingers. I know when I am bidding against some other low ball companies I have to adjust my presentation. I tell the customer upfront "I wont be the cheapest and here is why... "

All I am saying is knowing your compitition will sometimes open your eyes to your own strengths and weaknesses.
 

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Thats my point Grumpy.... Don't just look at the "going rate" and try and beat that. Look at your costs for doing business and demonstrate or educate the customer on why your price is what it is. I see the effects of low ball bidding every day, I see guys struggling for years and still can't afford a new truck or equipment. Being a contractor or being in business is about making money and showing a profit, otherwise you had better keep a resume close at hand. Good painters sometimes make bad businessmen, and good businessmen sometimes aren't good painters.... the most successful are good at both. :Thumbs:



Grumpy said:
Yes Mark in a way. If his overhead is way higher than anyone else he will lose jobs on price alone. If his overhead is way low and he is the lowest bid, he might as well raise his price a little bit and make more profit.

Yes Marketing and selling is very important. Infact I would say marketing and selling is AS important as being able to bid but what is also equally as important is knowing your compitition. I know if I am bidding against various companies I can raise my price because they charge an arm and a leg, and sometimes a few fingers. I know when I am bidding against some other low ball companies I have to adjust my presentation. I tell the customer upfront "I wont be the cheapest and here is why... "

All I am saying is knowing your compitition will sometimes open your eyes to your own strengths and weaknesses.
 

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Hey i got a question.Do you guy`s charge by the sq. ft. for drywall and charge so much for the trim package or do you charge a higher sq. ft. price and include the trim work.this is new home construction.
 
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