# working for multiple home owner



## Ceezz (Jan 6, 2013)

Hello everyone happy holidays, I recently got some work with people who own 15 or more homes and rents all. Should I give this guy a good deal for the possibility of great amount of work?


----------



## Sprtman (Aug 16, 2010)

No.


----------



## jaydee (Mar 20, 2014)

the price could go down After you have a good relationship with him.

But, not right away, that line *"give me a good deal and I'll give you a lot of work", *Doesn't usually happen


----------



## TNTRenovate (Aug 19, 2010)

Why would your price go down? If you can do it for less do it for less. Otherwise your price is your price. Makes no sense to me to do something for less for one guy than you would for someone else do to volume. 

Also consider that when you rely on one source you are not cultivating others. When that work is finished you have to play catch up.


----------



## avenge (Sep 25, 2008)

The short answer is No why would I give a discount unless you give me work at all 15 homes at the same time. What would bother the most is it being rental property, do they want crap work expected at a discount.


----------



## TNTRenovate (Aug 19, 2010)

avenge said:


> The short answer is No why would I give a discount unless you give me work at all 15 homes at the same time. What would bother the most is it being rental property, do they want crap work expected at a discount.


And then it's only due to convienence on labor and possibly passing on qty break.


----------



## Donohue Const (Dec 31, 2011)

Make an estimate for 10% higher then you need, then when you give it to him tell him he can have a 10% discount


----------



## TNTRenovate (Aug 19, 2010)

Donohue Const said:


> Make an estimate for 10% higher then you need, then when you give it to him tell him he can have a 10% discount


There ya go.


----------



## EricBrancard (Jun 8, 2012)

jaydee said:


> But, not right away, that line *"give me a good deal and I'll give you a lot of work", *Doesn't usually happen


I've noticed the same thing. Generally when someone feeds me that line, it's a red flag.


----------



## KAP (Feb 19, 2011)

If you do not give a legitimate answer as to why you are able to reduce your price, all you are doing is telling them that your price is padded... they don't know whether that is $10 or a couple of thousand... so they 

In this case, if they contracted with you for 15 homes, you can accommodate a cost-basis reduction in price... but it has to be based on reality, not fluff numbers... If you are able to order 15 sets of kitchens at once, and realize a bulk discount for doing so and want to pass some (not all) of this savings off to them to secure a bigger order, that's fine...

If you are able to spend the day going through all 15 homes spec'ing for orders, as opposed to 15 separate trips, again, if you want to pass some (not all) of the savings to secure the business, that's fine...

If you are able to contract a discount with an electrician and plumber, because they don't have to advertise to get the customer, meet with the customer and/or make multiple trips out, again, if you want to pass some (not all) of the savings to secure the business, that's fine...

BUT, the very LAST thing you want to do is to give him a "discount" that is not directly tied to a reality... Because the ONLY place that can come from is YOUR POCKET... everyone else expects to get paid... whether it's subs or materials...


Personally, the way I would handle it is telling him, the best thing about doing business with you is that you KNOW your pricing and he will know the price is the price for everything spec'd with no hidden gotcha's to get in the door and a subsequent change-order hurricane to follow...

Best of luck... 8^)


----------



## EthanB (Sep 28, 2011)

EricBrancard said:


> I've noticed the same thing. Generally when someone feeds me that line, it's a red flag.


I had a guy keep saying this last year, after about the third time I said "Ok, so I'm going to charge you 30% more this first time but then I'll give you a REALLY good deal on the next one!". He didn't find that appealing.


----------



## muskoka guy (Nov 16, 2013)

If I cant make my normal wage on this job, why would I want any more work from you to start with. Don't lower your price.


----------



## john5mt (Jan 21, 2007)

In my experience you don't want to do work for someone who owns 15 houses. They didn't get to that point by paying full price for things.


----------



## mstrat (Jul 10, 2013)

As KAP said, if you get a contract to do lots and get a discount on material, then *maybe* it's ok...but in reality, more often than not the rental property owner will want crap work at crap prices...don't be known as the guy in town that'll work on junk and make a look of being nice...word gets out and you'll be working on rotted out junk for years...all at a discounted rate due to 'volume'


----------



## fugsly (Jan 14, 2013)

Hell no... dont fall for its next or more bs.. EVER


----------



## tedanderson (May 19, 2010)

Does this guy REALLY own 15 houses or are you just taking his word for it? Typically when someone has that much property, they didn't get it overnight. And within that time frame of however many years it took them to get to that level, chances are that they've picked up quite a few contractors along the way. 

Not to say that they wouldn't do business with you but if they are seeking you vs. you seeking them, I'd be a little wary.

My family's business owns has multiple properties, both residential and commercial. One thing that I can tell you first hand is that we didn't wake up one day say, "OMG! We have all of these properties and no contractor!" It never could have happened that way. We have a decent network of people that we can call on for just about anything. If a new guy wants to join the circle, he can. But it's highly unlikely that he will even know how many properties we have until we know how well he works.


----------



## FrankSmith (Feb 21, 2013)

I have had a very good customer for the past four years. He provides lots of work but that is not why he is a good customer. He is a good customer because he respects my time and process. The first time I worked for him was for an addition on his home. He never told me about all of his other property when we met. I did a good job for him and I still don't know how many building he owns. I only know about the ones I have seen and there are a lot. The point is good customers don't try to use get leverage over you like that. Not only would I not give him a deal I wouldn't even work for him.


----------



## mikeswoods (Oct 11, 2008)

Be careful---this type of customer often expects credit----small handyman jobs that take more time driving than doing---find out what the nature of the work is--and his payment expectations.

Work done on credit must be billed at a premium---to cover the paperwork cost--the float and the added risk.


----------



## GTX63 (Sep 9, 2011)

A typical ploy for investors is to use the volume/steady work tactic for leverage. Not always but it is common.


----------



## Jaxyaks (Nov 7, 2014)

If you discount it once, he is going to ask for a little every time and that will become your price. I don't put much stock in the guy that tells me how much he owns in order to impress me to lower the price, he usually receives a higher price...these...I've got lots of work if you treat me right things never work out.

My rule with discounts is...if you ask me for one, your not going to get it...I am more likely to give a discount to someone who doesent ask. If the first conversation mentions a discount I'm probably not going to do the job....


----------



## Stephen H (Feb 18, 2011)

when I was starting out 25-30 years ago--- I did some work for a father/son team.

they never asked for any kind of a discount----and to this day they remain one of only 3-4 landlords we EVER did work for.

after several years I eventually learned( from the son)---- that between the 2 of them they owned over 300 units--- over 280 of them the fathers---and most of them were rented out above market to section 8

how the old man got 280 houses was........
back when the interstate highway system was being built in the 50's/60's --- the father had a housemoving business.
A lot of houses needed torn down or moved out of the way.

for anyone familiar with Ohio---- this was near the intersection of 76 & 77 or route 8 and 77

so the old man was buying houses for $1 apiece---and then his company would move them down 77 and store them in a farmers field outside of Dover. As he accumulated vacant lots elswhere--- he would move them again. He ended up with about 280 houses stretched in a swath from Akron to wooster.

when I knew them--- they were still accumulating houses--- primarily for the son. when they bought a house they REALLY fixed it up. No frills work---but done well. As the son explained it--- they bought a house and put in new everything, ---new furnace,new plumbing,new kitchen, new flooring---new everything--- then they would rent it section 8 to a single mom and her 3-4 kids and the house was by far the nicest house the single mom had lived in her entire life---and she would never leave, ever

anyhow--- they had 300 units and NEVER asked for a discount, ever. also--- I could upsell them ,if I explained how something would benefit them in the long run.

stephen


----------



## Cmac9000 (Jan 7, 2014)

Provide above excellent service and keep your prices where they are.


----------



## Jaxyaks (Nov 7, 2014)

Stephen H said:


> when I was starting out 25-30 years ago--- I did some work for a father/son team.
> 
> they never asked for any kind of a discount----and to this day they remain one of only 3-4 landlords we EVER did work for.
> 
> ...


That's an old school customer that valued your time and work...unfortunately with the google gotta have it now crowd the only thing they value is their own time and how they can whittle you down on a job


----------



## sailfish27 (Jan 25, 2014)

I'd absolutely give them a discount. There is a reason virtually every major corporation in America gives discounts to new customers and people who buy in bulk; it works.

Sirius just gave me a deal for $5/month for the first six months. After that it's $30/month. Cable $66/month for first 3 months after that it's $150. Chase 0% interest for 16 months. I could go on and on. 

These businesses aren't stupid and they know how to make money. They entice you with a teaser rate and then make it up later. If your happy with their service most people stay, either out of laziness or loyalty. It might be a slight exaggeration, "but no two customers get charged the same".

Landlords aren't your typical pita customer. Their businessmen like you, they won't waste your time. Once your trusted they will give you a crack at many projects even if they don't hire you for everyone. They also don't generally mind if you use them as fill in work between more profitable jobs.

If you study economics, it's very profitable to charge everyone differently. Depending on the season, how much they buy, what type of consumer they are,(how much they are willing to spend) and if there're new or not.


----------



## TNTRenovate (Aug 19, 2010)

sailfish27 said:


> I'd absolutely give them a discount. There is a reason virtually every major corporation in America gives discounts to new customers and people who buy in bulk; it works.
> 
> Sirius just gave me a deal for $5/month for the first six months. After that it's $30/month. Cable $66/month for first 3 months after that it's $150. Chase 0% interest for 16 months. I could go on and on.
> 
> ...


If you think that small business can operate like large corporations you are greatly mistaken. Larger businesses buy in quantities that give them huge volume discounts that they can then pass on to the consumer. Unless these 15 houses require large orders of materials that can be purchased as a lot with a price break, it would serve no purpose to offer a bulk discount.

You also have to consider storage of the materials purchased for the 15 units. Large businesses have plenty of warehouse space to store stock. Most small contractors do not have that luxury.

Satellite radio and cable TV are subscription services. They actually lose money on those promotions in hopes that you will try their service and stay with them for years. I am not a try before you buy service.

Credit cards are just a terrible example as most who fall for the low or no interest payments for 1 year, spend way more than they can pay back in a year and guess what? The fine print is terrible on those promos. If you don't pay off the entire amount with in the year you owe all of the interest. Credit card companies are not a model for most businesses.

But you are right. They make it up later. Your words, not mine. That means that in the end you really didn't save anything because they know how to play you. They know what to do to get you hooked and then make a ton of money off of you. That does not transfer to our industry. Unless he "makes it up on the last few houses", meaning he has to charge much more than the first ten, there is no point.

If you study economics you charge what you are worth, period. If someone doesn't want to pay you what you are worth, you move on till you find those that will. I made that move a few years back and have been amazed at the results. I was so afraid to charge what I really needed and wanted to charge that I kept settling for bargain shoppers. Now I make more than I ever thought I could and am considering another rate hike next year.


----------



## TNTRenovate (Aug 19, 2010)

Oh, and landlords are some of the worst people to work for. They are almost as bad as flippers and real-estate agents . They always want things super cheap and done yesterday.


----------



## Jaxyaks (Nov 7, 2014)

TNTSERVICES said:


> Oh, and landlords are some of the worst people to work for. They are almost as bad as flippers and real-estate agents . They always want things super cheap and done yesterday.


So true!


----------



## sailfish27 (Jan 25, 2014)

TNTSERVICES said:


> Oh, and landlords are some of the worst people to work for. They are almost as bad as flippers and real-estate agents . They always want things super cheap and done yesterday.


My examples of big business offering discounts is to prove a point. They are smart and savvy enough to know how effective it is. The fact is most small businesses use this technique as well. 

The other day I buy a couple cigars, the owner tells me if I purchase 3 more I get one free. Same at the convenience store, free coffee and donuts on Mondays. Barber shop same thing, discounts on Wednesdays. Tanning salon for my wife, buy a package she gets unlimited visits.

Again, I could go on and on. I can't think of a single business I purchase from that doesn't offer discounts.

Whether or not it's profitable for op to offer a discount to a small landlord is debatable. What's not, is the fact that is more profitable to charge different rates to different folks at different times. It's a mathematical fact. 

I don't disagree with charging what you are worth in totality. I just believe some people you charge a little less other people you charge more than you are worth.


----------



## Stephen H (Feb 18, 2011)

sailfish27 said:


> I'd absolutely give them a discount. There is a reason virtually every major corporation in America gives discounts to new customers and people who buy in bulk; it works.
> 
> Sirius just gave me a deal for $5/month for the first six months. After that it's $30/month. Cable $66/month for first 3 months after that it's $150. Chase 0% interest for 16 months. I could go on and on.
> 
> ...



In your 4th paragraph you write " landlords aren't your typical pita customer.... they won't waste your time..."

I am suprised you had the chutzpa to write that. My experience is that landlords, as a group,---are by FAR the biggest Pita, time wasting consumers there are---- just horrible, horrible people to deal with---horrible.

that's why after my first couple years in business we simply eliminated them from consideration----along with realtors. trying to think---- but I don't recall meeting a landlord I would be willing to deal with since maybe 1987, LOL
Stephen


----------



## TNTRenovate (Aug 19, 2010)

sailfish27 said:


> My examples of big business offering discounts is to prove a point. They are smart and savvy enough to know how effective it is. The fact is most small businesses use this technique as well.
> 
> The other day I buy a couple cigars, the owner tells me if I purchase 3 more I get one free. Same at the convenience store, free coffee and donuts on Mondays. Barber shop same thing, discounts on Wednesdays. Tanning salon for my wife, buy a package she gets unlimited visits.
> 
> ...


What's the percentage of small businesses that make it? How long do they typically stay in business?

Again your examples are service related. Haircuts are a must until you die. Cigars are cheap so they can afford to give you one free. They are charging you 5-10 times what they cost you. The margins are sky high. Coffee and donuts are the same thing. Your examples are not apples to apples with our industry. I have never been given a punch card from my plumber. Buy ten toilet installs get the 11th free.

It's not more profitable to charge different rates at different times. It's more profitable to determine what margin you want to make and charge accordingly. How do I know? Because that's what I do. I used to offer discounts and deals. Guess what? That attracted cheap arse clients who always wanted a discount.

Like I said before unless I am getting a discount that I can pass on, my clients will never get a discount. And so far I have been more profitable and busier than I ever have been.

I don't play games with my rates. If I am worth $125 an hour that is what I am worth to everyone. With that attitude I now make miter money than I ever have. I do not have to be a discount warehouse or give subway punch cards to get business. They see a premium service and pay a premium to get that service. 

There is a tile site here in town that sells tile higher than any other. People in this town could go down the street a few miles and pay 2-5 times less, but many don't. They want to be able to tell their friends and neighbors that they got their tile there. 

That is the customer I go for. The ones that haver money to spend, have no problem paying for great results and have friends just like them.

Too many contractors and businesses believe they have to sacrifice in order to make it. Give a customer great service for a great value and you won't need to offer discounts and cut rates. It's that simple.


----------



## KAP (Feb 19, 2011)

sailfish27 said:


> My examples of big business offering discounts is to prove a point. They are smart and savvy enough to know how effective it is. The fact is most small businesses use this technique as well.
> 
> The other day I buy a couple cigars, the owner tells me if I purchase 3 more I get one free. Same at the convenience store, free coffee and donuts on Mondays. Barber shop same thing, discounts on Wednesdays. Tanning salon for my wife, buy a package she gets unlimited visits.
> 
> ...


I think you are missing that you are not retail...

Take your cigar example... it costs the business nothing more to offer you a free cigar if you buy three more... retail is about moving product for that day... If the cigars cost a buck a piece and they sell it to you for $2, instead of getting a net buck with one cigar, they got a net $3 bucks for the four cigars. They tripled what they would have gotten for the same effort and added to their net for the day...

It's no where near the same as our industry... If you offer a "discount" that tells people there is padding in your price... the challenge is, they don't know how much and will continue to push...

If it worked as you'd like, you would be able to offer buy 3 bath's and get one free... people would KNOW you are charging more for the three to accommodate the fourth...

Discounting is the worst way to sell...


----------



## Moxley-Kidwell (Jan 28, 2011)

I think you have to look into this a little deeper. Being a new customer doesn't make the situation easy though. I'm in a totally different industry but most of our work is for repeat customers. A lot of the work is sort of negotiated, I'll do a proposal and may be high. Customer will give me another shot at it because he wants to use us, but has to answer to a higher power. Sometimes we will do the work a little cheaper, take less profit, but some profit is better than no profit. Some jobs there is no way we would do for less. If you establish a good relationship and know the money is good and steady work I would be willing to take less if you could still make a decent profit.

There is always talk of "if you are staying busy and have work lined up you aren't charging enough". There is a fine line and depending on your competition you may be at the highest price you can be. Get too high and you eliminate a large portion of your customer base. There is a very thin line to walk, take little less money and stay busy or charge more and work harder to find higher profit jobs. Unless you know the entire situation, area and competition very hard to advise someone.

There are always different ways to look at any situation. Starting out with discounts may not be correct and set a bad precedence, maybe talk about starting full price and possible volume discounts.


----------



## sailfish27 (Jan 25, 2014)

Stephen H said:


> In your 4th paragraph you write " landlords aren't your typical pita customer.... they won't waste your time..."
> 
> I am suprised you had the chutzpa to write that. My experience is that landlords, as a group,---are by FAR the biggest Pita, time wasting consumers there are---- just horrible, horrible people to deal with---horrible.
> 
> ...


As a small landlord, I'm sorry you have such a poor view of us. I'm only a horrible person from 8-5, unless of course, I'm on CT. :laughing:

The couple of landlords I work for own hundreds of residential units and 100,000's of sq ft. of office, mall, and retail store space. They're developers/GC's without a license. 

My experience has been very positive. I agree, they are not the most profitable jobs but they're great for fill in work. I have built a relation ship with these people were I can call them and ask them for work when I'm slow. I can literally tell them " I have nothing next week, you have anything need to be done"? More often than not, they'll find something.


----------



## Jaxyaks (Nov 7, 2014)

sailfish27 said:


> As a small landlord, I'm sorry you have such a poor view of us. I'm only a horrible person from 8-5, unless of course, I'm on CT. :laughing:
> 
> The couple of landlords I work for own hundreds of residential units and 100,000's of sq ft. of office, mall, and retail store space. They're developers/GC's without a license.
> 
> My experience has been very positive. I agree, they are not the most profitable jobs but they're great for fill in work. I have built a relation ship with these people were I can call them and ask them for work when I'm slow. I can literally tell them " I have nothing next week, you have anything need to be done"? More often than not, they'll find something.


That's a little different once you form a working relationship, but to discount right out the gate because someone tells you they have more property's and can give you more work if they can get a discount on the first one is not the best route. I've been there, it's not worth it and if one of the first things they want to know is if they can get a discount, they aren't worth it either.


----------



## sailfish27 (Jan 25, 2014)

KAP said:


> I think you are missing that you are not retail...
> 
> Take your cigar example... it costs the business nothing more to offer you a free cigar if you buy three more... retail is about moving product for that day... If the cigars cost a buck a piece and they sell it to you for $2, instead of getting a net buck with one cigar, they got a net $3 bucks for the four cigars. They tripled what they would have gotten for the same effort and added to their net for the day...
> 
> ...


Come on, are you serious? Have you ever hired someone to do work for you?

I'll list some more. My lawn company , my cleaning lady if I get neighbors for her. Drain cleaning company for first timer's and landlords. Plumbers who sell yearly service contracts with reduced service rates. Every company I ever worked for large and small either offerend discounts of manipulated their margins in order to do more business and be more profitable.

If you guys are so busy that you have zero slack, good for you . My question would be why not hire some more people?

Other's, like myself, would rather settle for a half of loaf of bread than no loaf when things are slow.


----------



## Jaws (Dec 20, 2010)

TNTSERVICES said:


> Oh, and landlords are some of the worst people to work for. They are almost as bad as flippers and real-estate agents . They always want things super cheap and done yesterday.


While I generally agree with the sentiment:

I have never asked for a discount from a sub contractor when they have done work on my home or rental.


----------



## TNTRenovate (Aug 19, 2010)

Jaws said:


> While I generally agree with the sentiment:
> 
> I have never asked for a discount from a sub contractor when they have done work on my home or rental.


You are not a landlord, you are a contractor who owns property. You don't ask because you get it.


----------



## TNTRenovate (Aug 19, 2010)

sailfish27 said:


> Come on, are you serious? Have you ever hired someone to do work for you?
> 
> I'll list some more. My lawn company , my cleaning lady if I get neighbors for her. Drain cleaning company for first timer's and landlords. Plumbers who sell yearly service contracts with reduced service rates. Every company I ever worked for large and small either offerend discounts of manipulated their margins in order to do more business and be more profitable.
> 
> ...


The fallacy is that you are more profitable if you lower you rates. That statement makes zero sense. You may be busier but you are less profitable. Rate is lowered effort is increased. That always equals less profit.


----------



## Jaws (Dec 20, 2010)

TNTSERVICES said:


> You are not a landlord, you are a contractor who owns property. You don't ask because you get it.


Im landlord over my property. ....


I dont ask because it is disrespectful and not how I do business. Building good business relationships is not done by disregard for one anothers need to make a profit.


----------



## TNTRenovate (Aug 19, 2010)

Jaws said:


> Im landlord over my property. ....
> 
> 
> I dont ask because it is disrespectful and not how I do business. Building good business relationships is not done by disregard for one anothers need to make a profit.


I just meant that you are not a "landlord". Yes you are a landlord obey your property, but that's like calling you a scumbag. I just can't call you a landlord.


----------



## TNTRenovate (Aug 19, 2010)

Jaws said:


> To be clear, i was not saying it is disrespectful or childish for a GC to have a discounted arrangement with a sub. I meant for your own house or property. Thats douchey to me.


Totally agree. In fact I give then a cash bonus for working on my house.


----------



## KAP (Feb 19, 2011)

Jaws said:


> To be clear, i was not saying it is disrespectful or childish for a GC to have a discounted arrangement with a sub. I meant for your own house or property. Thats douchey to me.


Thanks for the clarification... :thumbsup:

On the 15%... as an example, our average electrical charge is around $4500... that's a $675.00 difference at 15%...

Considering they charge $125/hour to HO's (about the eqivalent of 5.5 hours)... that gets eaten up real quick on driving to and from, and meeting with customer, estimating, etc...

That is, unless they do it for free... and the time they would have spent on that they can be out selling their regular jobs or actually working...

.


----------



## Jaws (Dec 20, 2010)

KAP said:


> Thanks for the clarification... :thumbsup:
> 
> On the 15%... as an example, our average electrical charge is around $4500... that's a $675.00 difference at 15%...
> 
> ...


Interesting way of doing things. 

I might PM you with some questions regarding the price list.


----------

