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Discussion Starter · #1 · (Edited)
Hello to everyone out there, I'm new to the website, and still learning the industry to some extent. This is a long post so bear with me.

I'm in the middle of a hellish project at this time and am really on the losing end of this thing. First off, this involved several aspects most of which have nothing to do with the business. We decided to pick up and move 350 miles from the DFW area to a tiny hellhole west of Odessa, TX. This was in conjunction with a move to Colorado. There is nothing here except a gas station, school and a few houses. The reason for picking up and moving was simple, my wife's aunt wanted me to remodel her house and it presented an opportunity for a large project enroute to our new destination. Before anyone says you shouldn't do business with family, we already know and regret that portion of it which is a whole different story.

I began a little remodeling to their house and they said if I could, "I should get some other jobs while the market is hot". OK, so I did. The fact that I am a 120 mile round trip from the epi-center of the oil boom in Odessa should have been a clue. That is a ton of fuel back and forth for any job, no matter how big. Anyway, I took a job in Odessa that in the DFW area would have netted a large profit. Or if I had been living in Odessa would have been very profitable. I barely broke even on it due to added costs for having to run around Odessa/Midland to track down materials etc and for fuel that I just plain did not account for.

So I took another job, this time in the little town where we were staying, remodeling a few of the teacher houses the district offers for their employees. I bid them as I normally do, not really thinking about or realizing the fact that I am at least 30 miles from the nearest hardware store and 60 miles from Lowes or HD and that NO ONE will deliver here. I can't even get subs at a decent rate because NO ONE wants to come out here. I'm losing money every day, not to mention the fact that I ended up moving my family BACK to DFW instead of to CO where we were trying to go.

Fortunately I've been able to make up a little on some of the unforeseen stuff that has come up that they wanted me to fix. I started adding in some trip charges for materials and stuff but it still isn't panning out. The biggest problem is that I can get ahead time wise but then something comes up and I end up losing HALF A DAY chasing down materials that may or may not be in stock at any particular store. Not to mention the miles and fuel burned up doing that. So I lose the time I was ahead, fuel in my truck, all of which burns my profits as now the project is behind schedule.

Is there anything that you would do, bring up to the district to try and recoup some of the losses? I never figured that my overhead would be that much more out here and that time was so easily lost in this place. I really would like to get out of the remainder of the contracts and go back to DFW, where I already have some other work lined up. I honestly don't know how I could get out of them or if I would in good-faith. I know this is a hard lesson learned business-wise that's for sure.
 

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Joseph A. Capece
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Sounds like you need to step back, take a deep breath, and re-group. Come up with a strategy and a gameplan as to how you're going to get out of the hole. This may require out-of-the box thinking so really make the wheels turn. "Fail to plan, plan to fail" as they say.
 

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Sounds like you need to step back, take a deep breath, and re-group. Come up with a strategy and a gameplan as to how you're going to get out of the hole. This may require out-of-the box thinking so really make the wheels turn. "Fail to plan, plan to fail" as they say.
Ditto

What does it cost to have the material delivered?

Instead of burning fuel to find out they don't have what you want call them.

Work 10 -12 hrs. a day to reduce travel time & to finish the project faster.

By the way 120 miles @ 10 miles to the gal. is only 12 gals. & @ $4.00 a gal that is only $48.00. That sounds like you bid the job too tight no matter where it was located.
 

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Discussion Starter · #5 · (Edited)
Ditto

What does it cost to have the material delivered?

Instead of burning fuel to find out they don't have what you want call them.

Work 10 -12 hrs. a day to reduce travel time & to finish the project faster.

By the way 120 miles @ 10 miles to the gal. is only 12 gals. & @ $4.00 a gal that is only $48.00. That sounds like you bid the job too tight no matter where it was located.
I do agree, I did bit the jobs way too tight, but like I stated, I didn't figure in the difference in driving than I normally would do. I had a major brain fart in this whole deal. I usually don't spend more than $600/month in fuel in the DFW area. Just in driving to the job site and back doubled that, PLUS material chasing.

I've been trying to just get as much material as I can plan for in one shot, but I don't know anyone that doesn't forget something here or there in their figuring. And its not a matter of how much to deliver, its a matter of WILL they deliver, PERIOD. The problem is that there is no reason for anyone to come this way and they can't or won't make it worth their while to deliver materials to me.

Calling them is almost a waste of time in and of itself. Most of the jokers that work at these places, even the smaller stores, don't know what I'm asking for. I'm not even joking. I can give them the SKU right off of their website, they can look it up and when I get there, they won't have any, even though their computer shows "X" in stock. It is ridiculous.

I have to say that it takes a special person to work out here. I spoke with my plumber back in the DFW area and found he did a few jobs out here. He realized the first time out not to trust any store or supplier out here to have what you need. He started bringing everything he could think of from DFW here and upcharging for it. Customers never balked.

I do have a few weeks coming up where I will be back home doing some work so I have some time to refigure how to get the rest of this crap done out here in a more profitable manner.
 

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Boondockian
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Since you will be back "Home" in a few week, why not make it into a major supply run. Figure only exactly what you need to finish the job and buy it all. If that is too much to store/ship, figure out exactly what you need in the next week/month/ect and get tht. If you can't et it all there yourself, get ahold of a shipping company to get it delivered. if It can for on a rolloff towtruck, look into having a towing ompany run it out for you.

I think the key to you making this job more profitable is to stop all the supply runs. An start saying no to change orders or at least make them profitable enough to make them worth the extra hassle.
 

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Discussion Starter · #9 ·
That actually is what we decided to do, but the logistics of bringing all that in my tool trailer may not work. But if necessary and there was no other way, I can bring another truck and trailer to bring it all out, I just have to figure out how to charge the customer for that hassle.

How do you bring up something like that to a customer or do you just eat it since you didn't bid it?

The supply runs do hurt I just don't/can't store all the "extras" that may come up. I'm usually pretty good at keeping a stock of incidentals but that was when I had a shop to store stuff like that in.

I appreciate the suggestions, implementing them is the difficult part. Unfortunately my tool trailer isn't THAT big or I'd bring the entire store out here to keep from having to go back...
 

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As old school lumberyards and hardware stores are becoming ever closer to extinct, tradesmen in "fly over Country" have to pack their lunch and supply chain,Ever try UPS/fed Ex next day????

Captain Sully says, "Checklists, Checklists, checklists, and more Checklists.......

You've discovered why people live in big cities....better late than never.
Use this fact to plan a more rational future for your family.
get a bigger trailer. 10 ply tires on the truck...

More putty less special sauces....quit offering/selling stuff that isn't in the same county as you are....

hire a Go-fer, send the wife... home owners???
teenager with a DL? retired anything...
Bailing wire, all thread...

Double shifts 13-14hrs at the jobsite might pay twice a week with 2 go-fer days in between.
As Mr. Biagi said in VoAg, "Proper Prior Planning Prevents Piss Poor Performance."
The lazy never started, the Weak died on the way. Oregon trail 1840s.
 
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Head Grunt
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Sounds like a city fella just got porked with life in the sticks. As others said work longer days, bid a little higher to compensate for the extra fuel cost and windshield time. I myself make out a material list and try to get everything to the job myself all at once or in a couple trips. This is where owning trailers can be handy. You can load then up far heavier than a truck, safer and can be left on the job. $600 in fuel? Wish i could get away that cheap. I normally go through at least $800 a month, winter months the fuel bill gets up to $2k a month due to plowing/sanding. For me we have the local hardware, nearest lumber yard is 5 miles away and the next one is 17 miles away. Home Depot and Lowes are a 1hr drive as well as my electric suppliers. The owner of the local lumber yard and i do not see eye to eye so i if i need lumber i most often go the extra miles, and i make sure he knows it to when i do stop in under duress. Otherwise the owner of the hardware and i get along great and does whatever he can to satisfy my needs. He even keeps his prices close to my suppliers so it is foolish to even attempt the drive to my suppliers. The project i am on now is a 30 minute drive and the owner is charged for both directions as well as any trips to suppliers. This is also a T&M job.
 

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my truck gets 8mpg....I use $1,000+ a month in fuel

part of that I offset with a $60 trip charge and most of it is in my hourly rate

you moved, but never calculated your expenses for your new work area

anyone can solve your problem----raise your prices

if it takes you 5 hours extra and $500 in gas to complete a large project then add $1,000 to your bids for it....

also keep looking for suppliers...it took me 1 year to find all the suppliers in my own area....maybe there is 1 by you that delivers that you haven't found yet
 

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Sounds like your practicing for a move over here. Until a few years ago the nearest Home Depot was 8 hours away........BY PLANE! Piss poor planning can kill you here.
 

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There is nothing wrong with going to the district and explaining that you can't get suppliers to deliver there because they are not a serviceable community. Explain that you did not know that going into the project, and that the transportation costs were going to have to be adjusted to accommodate this reality. You also need to explain you need to be compensated for your time as well, as you have to act as delivery person as well.

Work out an hourly rate that compensates you for time, travel expenses AND profit and present it to them... Honestly, I would include hotel costs for whatever time is left on the project and tell them it will benefit them in travel savings, and just get it done...

If they balk, explain the reality that you can't continue with this project as it stands as it is costing YOU money. Without them being able to amend it, which they will have to do with any other contractor they bring in if the deliver issue is legit, you need to be released as you can't service them the way they and you want to and you can't operate at a loss...

They are a school district, and should be aware of these issues...

They are called Change Orders, and you just have to get them to approve them going forward... hopefully your contract has an "unforeseen clause" in it...

Best of luck... 8^)
 

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Was it a competitive bidding situation (school district, hard to see how it couldn't have been)? Did you take business away from another contractor by bidding too low to perform the work? If I were that guy, and I heard you were back saying that you couldn't perform the work for the price you bid, I'd be forcing you and the school district into some painful decisions.

I'm sympathetic to your situation, because I've screwed up, too, but I'm not sure you should expect to get a friendly response to a request for more money.

Edit: If you simply can't do the work for the price you bid, if there's no way to save it by working long hours, and doing it is going to hurt your family, then yes, of course you need to go to the district and say, "I can't do it." Maybe they'll give you more money, maybe they'll settle up with you and give the rest of the work to another bidder.

Edit again: The thing is, I've been the guy who submitted a fair bid and lost the job to the guy who underbid it. Intentionally or not, it's upsetting to see another guy ask for more money because stuff costs more than anticipated, or takes longer than he thought, or the inspectors were tougher than he thought.
- Bob
 

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I've got a lot more sympathy for the guy who makes an honest mistake and underbids a contract than I do for those jerkfaces who intentionally bid low with every intention of adding in a ton of change orders.
 

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Home Repairs
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In the future, think like the estimator and not the field guy. The keys to success in businesses like yours are often in the smaller details. The first things that the estimator should have his head wrapped around are:

1. Distance & logistics
2. Economical availability of materials
3. Unusual job site conditions and possible problem areas.

It looks to me like the stress and chaos of moving might have been a factor in you over looking these basic principles. The field guy will always want to say...go go go go! The estimator will always say no, no, no, .....until the numbers are right.

I have been where you are right now and it is down right scary and frustrating. I have a sense that you already know what to do, but I'll say it anyways. Stand by your obligation.

Good luck pards! I'm pulling for ya.
 

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I've got a lot more sympathy for the guy who makes an honest mistake and underbids a contract than I do for those jerkfaces who intentionally bid low with every intention of adding in a ton of change orders.
I know what you mean, but how do you tell the difference? Obviously that's not true about the O.P. here, or he wouldn't be on here asking about it. But those "jerkfaces" generally make exactly the same plea as the O.P. - they didn't know or understand; and they make their plea convincingly enough to get more money. My response to those guys, or to the homeowners left holding the bag, is that the contractor, knowing that he's in a new situation, has the obligation to figure out what's different.

- Bob
 
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