# When clients want cost breakdowns



## RbeatuHZQg (Sep 20, 2019)

I run a small full service residential contracting operating and recently completed minor repairs on a rental property. Upon receiving the invoice the owner requested that in the future I breakdown the material and time costs. It is my policy not to oblige such requests as the client/prospect is either shopping for the lowest price or attempting to reveal my profit margins or material markups.
I've heard an analogy used comparing it to other full service industries such as restaurants. Asking for a cost breakdown from a full service home repair contractor is like asking a restaurant owner what he paid for the produce, the meat, and what he pays his employees to cook and serve food. 
Additionally, when customers want phases of a job broken down into cost, or want to buy or use their own material drives me crazy. Like on a bathroom remodel, if they want to know how much is the demo, how much is the floor, the walls, the tile, the painting etc. etc. Or "use up any 2x4's you can find in the garage and take that off the cost", or "Just tell us what we'll need and we'll go get it and you do the work".


When you go to a car dealer to buy a car, would it be acceptable to say "I can get those doors cheaper, take those off....and I already have tires so take those off too and don't charge me. And if there's any gas in the tank please take it out and take it off the bill."
It wouldn't be tolerated and shouldn't be in our industry.

Would it be acceptable to bring in your own ingredients into a restaurant and tell them you just need to use the grill or oven? Or to bring in your own bottle of wine, or server and table and chairs? No it's all set up for your there as part of the full service.

These are some examples I've seen of how homeowners attempt to manipulate and take advantage of contractors and make running a business and closing sales a pain in the ass.

What are some similar or common experiences you all have had and what are some of your replies or responses?

Cheers and good luck out there!


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## Leo G (May 12, 2005)

On rare occasions I'll break some of it down, rarely.

Going from room to room in a house you can break down the rooms.

But what you do is you break it down and add 25% to each process. 

Room redo $1000.00

Floors $300
Walls $300
Ceilings $325
Trim $325
-------------------
$1250.00


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## 480sparky (Feb 1, 2009)

Leo G said:


> On rare occasions I'll break some of it down, rarely.
> 
> Going from room to room in a house you can break down the rooms.
> 
> ...



Yep. The parts are more than the original sum.


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## Dan_Watson (Mar 1, 2008)




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## Leo G (May 12, 2005)

If it's after the fact you just tell them no, this was a bid job. And offer, at your hourly rate to write up the time and material aspect of the job.

If this is a time and material job you owe it to them to give them this information.


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## Chris Doom (Mar 21, 2019)

RbeatuHZQg said:


> I run a small full service residential contracting operating and recently completed minor repairs on a rental property. Upon receiving the invoice the owner requested that in the future I breakdown the material and time costs. It is my policy not to oblige such requests as the client/prospect is either shopping for the lowest price or attempting to reveal my profit margins or material markups.
> I've heard an analogy used comparing it to other full service industries such as restaurants. Asking for a cost breakdown from a full service home repair contractor is like asking a restaurant owner what he paid for the produce, the meat, and what he pays his employees to cook and serve food.
> Additionally, when customers want phases of a job broken down into cost, or want to buy or use their own material drives me crazy. Like on a bathroom remodel, if they want to know how much is the demo, how much is the floor, the walls, the tile, the painting etc. etc. Or "use up any 2x4's you can find in the garage and take that off the cost", or "Just tell us what we'll need and we'll go get it and you do the work".
> 
> ...



Tell him next time theres a $200 administrative fee for writing up a complicated invoice


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## Randy Bush (Mar 7, 2011)

Agree with what other have said. I rarely ever break it down into T/M, will brake down different parts of a job. When ever asked tell them it is a completed job I am selling you. And all material belongs to me for the job until install, Because I normally buy in full boxes the surplus is mine. When people start wanting it all broke down it because they are trying to be cheap.


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## 480sparky (Feb 1, 2009)

Randy Bush said:


> ...........When people start wanting it all broke down it because they are trying to be cheap.


They either want to use the info to beat you up with it, or to have you do half of it and someone else to do the other half.

If mine is a turn-key operation, then I won't break it down. I won't rough in a house if Cousin Elroy is going to trim it out.


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## Calidecks (Nov 19, 2011)

I always give them their cost breakdowns, never my cost breakdowns. That's what they really want. I don't give them itemized, I give them procedural. 


Mike.
_______________


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## griz (Nov 26, 2009)

breakdowns were mandatory in my previous world...

mobilization

demo

rough frame

etc etc etc....

all per schedule of values...

ain't no big deal


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## KAP (Feb 19, 2011)

griz said:


> breakdowns were mandatory in my previous world...
> 
> mobilization
> 
> ...


Yeah, but for different reasons than RESI... rentals, the guy has one goal in mind...


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## Idothat (May 19, 2018)

The OP said it was an invoice for completed work , not an estimate. 

When I turn in a bill for work done on a T&M basis , I break it down by day with a rough outline of work done on that day and hours worked and materials used . 

Many times all the work is hidden by the finished product , showing what was done on any given day helps eliminate questions about the amount on the invoice. 

If it is a bid job , materials prices are not given , where applicable type , brands , model numbers, finish colors , are given , along with a scope of work . 

If the customer wants every aspect of a job broken down and separated, on an estimate , they are usually price shopping


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## Fishindude (Aug 15, 2017)

Generally not until after we are awarded a contract, but we frequently gave breakdowns to use with billing, then each month bill for what percentage of each item on the breakdown is complete. I think it's wise to front end load your breakdowns so that you get more of their money up front; for instance if concrete represents $30,000 and painting represents $10,000, on the breakdown the client sees it's $35,000 for the concrete and $5,000 for the painting.

I also make it very clear that this breakdown is a not a shopping list they can pick and choose from. We have a contract for the entire project.


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## woodspike (Dec 2, 2018)

i , most times give a breakdown 
i do from one day , to 2 month jobs .

definitely they can use it against you , and use it to find a cheaper guy 
but it also shows a little honesty 
and that , a lot of times is the key reason they hire you .their entrusting you inside their home , or business
if they`re looking for the cheapest cost, i don`t want that client anyway

breaking it down shows your efficient
it shows your thinking about their individual job.
we all can just say " a fence is $28 per foot( hypothetical) , and give that cost.

but if you show them that you have estimated the material cost , and broke it down per step ( demo/framing/drywall/paint/electric/plumbing etc..) they`ll figure you actually have it planned out .
again , yes i lose a lot of jobs from people who look for cheaper , i don`t care , their not my target customer/
if they want to bargain , i can at least say " that's my material cost , i make this much an hour , i can`t do much better "

this sounds silly ,i`m not a B.S. talking salesmen , but my final argument ( if i want the job) sounds like this 
" your paying for piece of mind . you can see i know what i`m doing , i`m licensed , insured , been in this town for over 40 years , have no blemishes on my license. i came recommended.
you can get cheaper , but if you pay a little more your getting a guaranteed product , as opposed to a gamble "


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## Big Shoe (Jun 16, 2008)

I generalize my breakdowns. That’s it. Take it or leave it. 


Sent from my iPad using Tapatalk


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## madmax718 (Dec 7, 2012)

Quality materials cost more. Galvi nails cost more than electro plated, and a box of bostich is almost 2x that of no name brand Chinese nails. Hard to compare two similar estimates.
Should a customer care? Well, if you go to a auto repair shop, there's the HR book price for the repair, and then the parts cost. Markups aside, the OEM parts is always the more expensive option.

But I would never use customer supplied wood or materials. Like a 2 year old bag of concrete ,or the warped and bowed plywood.


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## A2Zcontracting (Jun 15, 2019)

Im a little curious as to how i want to do this on my future contracts. It seems that customers have gotten hip to the markups and think they will just buy everything themselves to avoid it but this is a double edge sword. While i dont mind customers picking out thier own stuff or even purchasing certain parts like tile and stone, prefab cabinets or plumbing fixtures (after i give my 2 cents of course), the last thing i want is them trying to buy every nail and outlet cover!

That being said, i will need to do some sort of rough breakdown if im going to make multiple draws on a remodel job and need to get a good method for partial price breakdowns to at least cover certain phases when a payment is due upon completion.

Is it cool to do a draw for demo/materials at the start of a job and include a markup on materials? Obviously, i dont want the client to know exactly what i bought or what i paid. Just want to cover myself while i start getting into the bulk of the work to be done.

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## Leo G (May 12, 2005)

1st thing to tell them is any customer supplied items have no warranty from you. The markup you put on items is one of the parts that pays for warranty repairs in case the need arises.

So when they buy that cheap fixture and 3 month later it fails you don't have to fix it for free, you get to charge them full price for the repair. If they want any warranty they will have to do the legwork from the manufacturer themselves.


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## MarkJames (Nov 25, 2012)

My excel invoice for a rental property turnover job goes something like this: The ADDL. is for anything you decide to charge separately, as you see fit, and how it's briefly described. Written properly, it looks thorough and a good deal.

Painting:

Prep and paint
(....for ______rooms, walls, etc.) ...... ADDL ..... BASE $

Repairs ............................................ADDL ..... BASE$
(define briefly)

Plumbing:

replace cartridge, tub/shower, etc....... ADDL ..... BASE $
replace aerator
supply/install toilet seat.....

HVAC:

supply/replace filters ........................ ADDL .....BASE $

Electrical (switches, plates, outlets, etc.)

MISC:


Subtotals, Net Due, etc. etc.


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## woodspike (Dec 2, 2018)

ON SMALLER REMODEL JOBS , I LET THE CLIENT BUY THEIR OWN FIXTURES OR APPLIANCES.
i just don`t want to be responsible for those items anyway .
i offer to pick the up if they need for a cost .( a lot of times they can`t carry heavy items )

as for clients wanting to get their own materials , i wouldn`t really want that either 

i would tell them " let me make your material list, and either you have them here , or i can go pick them up or have them arrange for pick up"

most times they`re o.k with my getting my own materials . they can see i`ve spelled out everything , and they can see i`m not hiding anything .
i do mark up my materials a bit . 
( there`s always ways to fudge things here or there .
the best way to hide something is in plain sight anyway ):whistling


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## Dirtywhiteboy (Oct 15, 2010)

woodspike said:


> ON SMALLER REMODEL JOBS , I LET THE CLIENT BUY THEIR OWN FIXTURES OR APPLIANCES.
> i just don`t want to be responsible for those items anyway .
> i offer to pick the up if they need for a cost .( a lot of times they can`t carry heavy items )
> 
> ...


I know why the key board has an `okina:blink: do you?


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## Leo G (May 12, 2005)

So we can type Hawaiian.


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## Dirtywhiteboy (Oct 15, 2010)

Leo G said:


> So we can type Hawaiian.


That and because Hawaiian is our state language.


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## GCTony (Oct 26, 2012)

We always break down our costs per trade/task for commercial bid work, not broken down to T&M. 

I would ask the client why they want invoice broken out for a stipulated sum contract.

If someone is doing work for me T&M, darn right I'm going to ask for the time and materials broken out along with a description of work that was done. We don't do it al that often but 90% of the time when a sub is working T&M, they are billing us more than what they did. We keep job logs so we know what hours they worked. We know how many light switches were installed on the job.


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