# Bidding



## perk (Dec 18, 2011)

Hey guys customer wants labor prices only she will purchase all material . I will have to meet with them everytime I need something from different suppliers. Good or Bad ? The house will be a flip house. Drywall, kitchen,floors,bathroom,electrical complete rehab.


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## mrcharles (Sep 27, 2011)

Don't do it.... Waste of time, and you won't make any money. They want to to do all the running around and not make anything for you time.


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## mike gunderson (May 23, 2010)

You could bid it at cost/plus. I've done that in these situations. If they don't agree, don't do it.


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## perk (Dec 18, 2011)

Thanks guys appreciate your help.


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## go dart (Dec 6, 2005)

If your a one man show why not? Often times driving around gathering parts doesn't pay anyway. Quote labor and be specific about anything you're going to furnish ie: fastners/adheasive etc. Plan ample time in your quote for making they're material list and charge for it.


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## PCI (Jun 8, 2012)

I've done it with flip houses and have done ok. I provide a time line and when I need materials and a list of acceptable products ie light weight rock, tile thinset etc. Then I charge per man/hr. My materials list is over kill and then they can return extras.


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## ryanshull (Nov 1, 2012)

Figure your time to go along with them to be sure they are getting the right materials and the right amount, and offloading them at the jobsite in the right place and order. Nothing like moving everything twice. Expect to pick up some of the small stuff on your own. Make the $ worth your extra headaches.


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## ohiohomedoctor (Dec 26, 2010)

Just give them a complete material list and dont start until EVERYTHING is in the garage. It also helps in these situations to have a slush fund of which necessary materials can be purchased from on the spot.


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## Oconomowoc (Oct 13, 2011)

So are you getting paid to ride along? 

Jobs like that suck. I've done those back when I was desperate. Never again.


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## Seven-Delta-FortyOne (Mar 5, 2011)

Absolute pain in the balls.

"Project Management" is the thing that usually gets overlooked. Someones gotta do it, but the HO thinks they are hiring an hourly labouror, and doesn't have a clue how much supervision goes into a project.

And on the other hand. the Contractor who is only getting paid for hours worked on the job, shouldn't be putting in hours doing planning and PM work, and not getting paid for it.


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## WarnerConstInc. (Jan 30, 2008)

No way, those kind are awesome. It will be a good one for sure.


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## Oconomowoc (Oct 13, 2011)

WarnerConstInc. said:


> No way, those kind are awesome. It will be a good one for sure.


Lol


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## jhark123 (Aug 26, 2008)

WarnerConstInc. said:


> No way, those kind are awesome. It will be a good one for sure.


You just want an entertaining story for CT, I do too:thumbup:


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## Spaint90 (Dec 26, 2011)

Might be a really good time to step back and "take control" of your business.


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## Big Shoe (Jun 16, 2008)

Remind them about all the small stuff you need.......garbage bags,dust mask,brooms,dust pan,garbage cans,saw horses,fasteners, etc,etc,etc


They don't think about the many hundreds of dollars of small stuff that adds up!!! :huh:


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## Inner10 (Mar 12, 2009)

WarnerConstInc. said:


> No way, those kind are awesome. It will be a good one for sure.


You sound a little sarcastic...I had a job like that where the guy bought all his crap off ebay...I mean everything...well long story short it was an hourly job and I was billing out myself and 2 others. After all the screwing around with defective gear we billed out over a week and capitalizing on just labour was fairly profitable.


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## cabinetsnj (Jun 10, 2012)

perk said:


> Hey guys customer wants labor prices only she will purchase all material . I will have to meet with them everytime I need something from different suppliers. Good or Bad ? The house will be a flip house. Drywall, kitchen,floors,bathroom,electrical complete rehab.


These type of arrangements can really put you out in terms of time spent on the project and for what? You arent getting paid on any materials but will have to take out the time to put everything together anyway.


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## Driftweed (Nov 7, 2012)

Do it in phases. Thats what I do. Make it an open bid by the hour. I always insist on new clients to buy materials. It a form of insurance, at worst im only stiffed for labor.

The second you step on the jobsite your on the clock. Regardless if your doing physical work. Never go with them to get materials. Make your list, send them for it.

They wanna be a "gopher" then let them learn. When they show up with wrong stuff, send them back and chill on the clock.

I sent one guy to Menards 3 times/day for a month straight because he couldn't figure out pex fittings. He said he would never do that again. 

An 8 day job stretched out for 4 60hr weeks.


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## darrell0263 (Nov 21, 2012)

If you clarify with the customer that since you will only be billing them for your time, that you will need to bill them for all your time including meetings, travel to pick up materials, etc. They may not understand all the overhead time associated with doing the work that is normally absorbed in the overall labor and materials quote. 

If you documented all your time and they were prompt in payment it could be a win-win. We know how unfair and inaccurate it when people say "all contractors are crooks" so we shouldn't automatically assume all homeowners are stupid or trying to rip us off either. And yes, I have been burned by stupid, dishonest customers so I know it does happen.

Good luck!


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## perk (Dec 18, 2011)

The customer has seen my work and has been ripped off by guys giving half down or whatever. This seems like a headache job . I am suppose to start writing a bid to start Monday which I can't give right? I should give her several small invoices for every thing I do or a flat hourly rate ? In other words she still wants an estimated total of labor pricing and how much she is going to spend on materials as if it was a lump sum job.


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## pdmig (Nov 21, 2010)

I give a job visit and a general cost for the project. If they want to go forward it is time and materials for everything. Planning, material run, one way travel. If they want a fixed price they pay for the time to write the bid. Make sure you get paid for all of your time.


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## J M J (Feb 2, 2012)

I did this once, It worked out OK. I bid the whole job for my labor and time. Then everytime I went to homedepot I went to the pro desk and the customer paid over the phone with a credit card.(Think she just wanted the points on her card)


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## Driftweed (Nov 7, 2012)

perk said:


> The customer has seen my work and has been ripped off by guys giving half down or whatever. This seems like a headache job . I am suppose to start writing a bid to start Monday which I can't give right? I should give her several small invoices for every thing I do or a flat hourly rate ? In other words she still wants an estimated total of labor pricing and how much she is going to spend on materials as if it was a lump sum job.


I have an ivestor like this. So I tell him, this is the labor only bid @$1 sq/ft. $300. He will ask for an estimate on materials. I tell him it ranges from $0.25/sqft cheapy peel and stick tile to $2 sqft for laminate floor. So it could cost up $600 additional for materials.

My last bid went like that. Whole house plumb, install water heater, sister 2 joists, relay 3/4 subloor, then lay laminate. Gave bid for labor only. He inquired about materials. I said expect 3 grand in materials.

Thats all these guys want. A number to prevent sticker shock.


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## VAviaCo (Sep 3, 2008)

Problem I had was they took my list to Lowes and some guy there said we are out of that size but these will be just as good. From there it only goes downhill.


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## Robs660 (Jan 15, 2012)

Ask them if they go to Red Lobster and bring their own shrimp and lobster for the chef to cook? If you need the work then you have to layout very clearly what you are responsible for and the amount of time they have to respond to your request for materials. You sill still end up using sundries out of your truck from time to time and you need to have a provision to be paid for them at a prescribed mark-up. 

Finally, I would require some form of deposit. Maybe 1 or 2 weeks pay @ 40 hours up front. I would also increase my hourly rate to cover some of the lost profit on materials. 

Or, ask the client to setup an account at a few of your local suppliers and grant you access to the account so that you can go get things as if its a normal job. Then charge them for time and mileage each time you need to go get something


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## ryanshull (Nov 1, 2012)

Robs660 said:


> Ask them if they go to Red Lobster and bring their own shrimp and lobster for the chef to cook?


I like this analogy.


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## BlueRidgeGreen (Apr 21, 2012)

Should be fine. 

Just stay way ahead of her on material orders so she can get them way before you need them and make sure you add plenty of run around time into your labor estimate.

If that deal is all that is front of you, take it and just be smart about it. Job like that could be just like picking from the money tree if the client is serious about getting it done.

Back when I was younger I did a couple like that for very detail oriented and capable people who took over the purchasing. It was like having a great staff that just allowed me to work and earn. I just let them know what I needed and they got it there. Worked out quite well.

Just go labor cost/plus a small rip or adjust your hourly to account for the extra hassle. Sounds like she just wants a good # to go on.


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## Ron Pestone (Nov 22, 2012)

perk said:


> Hey guys customer wants labor prices only she will purchase all material . I will have to meet with them everytime I need something from different suppliers. Good or Bad ? The house will be a flip house. Drywall, kitchen,floors,bathroom,electrical complete rehab.


They deserve themselves.


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## EthanB (Sep 28, 2011)

I've done jobs like this. I just tell the customer that it's cheaper for me to order and buy the materials. If they want to purchase them then I explain that I will still be charging my markup as I will still have to tell them what to buy and when to have it there. It's no different than ordering from my supplier except I know my supplier knows what the hell I'm talking about and will have it there on time. 

If you do these you also should have a Cost of Delay clause in your contract.


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## Driftweed (Nov 7, 2012)

I'm stumped here, why would he markup materials he isn't buying?

That's a red flag right there. I know it would be if I was the customer.

Your hourly rate is your hourly rate. Regardless of whether the work is physical or mental.

Wow, like things complicated?

Imagine saying this:

Sir, when I do grunt work it $x/hr. When I'm planning it's $x/hr. Btw, when I do plumbing, that rate changes to $x/hr. Drywall, paint, flooring all have their separate hourly rates as well.

Maybe I just suck a nickel diming. Its purely unethical in my eyes.


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## elementbldrs (Sep 26, 2010)

Believe u me brothrr, I charge a big difference between a shovel and mini excavator....


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## BlueRidgeGreen (Apr 21, 2012)

Driftweed said:


> I'm stumped here, why would he markup materials he isn't buying?
> 
> That's a red flag right there. I know it would be if I was the customer.
> 
> ...


 I tend to agree. Not necessarily "unethical". Maybe overly complex.

When I did the type the OP is talking about, I just came up with a base hourly # that i thought fairly compensated me for the varied work performed (including hand-holding and baby-sitting), and let the materials be solely the clients domain. Every minute of contact with client is billed. Done.

When I wrote a list it was detailed and concise, easy to convey to any salesman at the yard. They got the stuff...on time, cause I requested it earlier than needed. So easy. Wrong screws for Durock? "Please have the right ones by Monday"; which is 2 weeks before you actually need them.

I did some of this when my son was just born cause I wanted time off and flexibility, and had just moved to a new state. It was perfect. I guess it depends on the client, but I have had nothing but relaxed, enjoyable experiences with these. Just go to work and occasionally write a list. Cake.....walk. 

Worst case scenario. She's a miserable, underhanded bi^(& ? Friday pm....invoice.....check....bank.....deposit..... "Bye!"


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## Driftweed (Nov 7, 2012)

elementbldrs said:


> Believe u me brothrr, I charge a big difference between a shovel and mini excavator....


It's a remodel. No special tools or heavy equipment needed. 

I know a guy (and we have this argument all the time) who will create a small novel for a bid. He even charges by the trash bags he uses.

Me, One price all inclusive. One damned number. I'll make enough of that number to take care of overhead (new tools, gas, insurance, etc...)

"well you gotta charge each time you go to **** depot" he says. I tell him I've calculated for x amount of trips, anymore and it's my bad.

Either you want to do it the simple stress free way, or you can do it the paranoid way. It's up to you. None of us can tell ya.


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## BlueRidgeGreen (Apr 21, 2012)

Even if I was helping bring in/coordinate/quality check a few subs. No % on the subs. Just a higher hourly reflecting that set of skills.

Not the way to maximize the $ return on your skills. But nobody is taking these jobs and turning down $2mil custom homes cause it's their dream scenario.. You take them when you need to, or choose to. 

IMHO, they can be done just as easily as any other, easier than a few that made me much larger profits. Just sayin can't knock the small or unconventional.


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## BlueRidgeGreen (Apr 21, 2012)

This is an hourly.....no "bid". Just an estimate. Go in there, give her your honest-to-goodness, well-considered "dinner napkin #", then add 15% and call it a meeting.


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## elite173 (Oct 9, 2012)

*Why would you want to work for free?*

You’re in business to make money? You would think. Estimate the job and bid accordingly. Working by the hour will pay for you to eat peanut butter and jelly sandwiches only. You will feel satisfied when you’re done eating but when you run out of food you wont have any funds left for you to pay for your phone bill, or fuel to drive your Vehicle to purchase the next sandwich. Overhead is vital to remaining in business....


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## EthanB (Sep 28, 2011)

Driftweed said:


> I'm stumped here, why would he markup materials he isn't buying?
> 
> That's a red flag right there. I know it would be if I was the customer.
> 
> ...


If this is directed at my post then I'll explain. If not then....proceed.

I charge markup on materials if I buy them or the customer buys them because it is how I calculate my bids. When I bid a job I don't figure x hours for driving to the store or x hours for placing orders. I have a flat markup that applies to my materials to cover the costs and then it's good for all future estimates.

If I buy materials then it would actually cost me something like(fake #'s):
materials = $6000
time ordering =$120
time receiving and picking up = $120
So the total costs are $6240 and the customer pays $6240

If the customer pays direct and I don't charge markup then:
materials = $6000
time ordering =$120
time receiving and picking up = $120
time spent talking to HO about materials and calling them to arrangeha payment etc. =$100
The customer pays $6000 and I eat $340. Sounds pretty lousy to me.

Then there is the even more common scenario which happened to me again this spring and caused me to change my contract. The HO went and ordered seconds of the tile we had agreed on without telling me and it took me an extra 8 hours to tile the bathroom to my standards. 

Now show me how charging for my time is unethical.


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## cabinetsnj (Jun 10, 2012)

perk said:


> Hey guys customer wants labor prices only she will purchase all material . I will have to meet with them everytime I need something from different suppliers. Good or Bad ? The house will be a flip house. Drywall, kitchen,floors,bathroom,electrical complete rehab.


If you need the work then do it. If not, the job may be more trouble than what it is worth. You will be expected to meet with suppliers on your own time. Unless the woman is willing to pay you for your time when you meet with different suppliers.


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## Driftweed (Nov 7, 2012)

Ethan:

Im not directing that just at you. This was my interpretation of what was being said:

You agreed to an hourly rate to do the job (i.e. $50/hr). Customer is to purchase materials and deliver upon request.

So the customer agrees to this. Well you already know that there is going to be SOME demo to do. So day 1 you show up, go on the clock and make an initial materials list with the customer.

At this point, your on the clock. Now your gonna make them pay you for something your not buying or doing? (driving, purchasing materials) <---- unethical to me

While there shopping you doing demo so you don't have a wasted day.


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## gastek (Mar 29, 2011)

Well if these folks are seasoned flippers, they should have a pretty good idea on what things are going to cost. If they are beginners, look out as you will get screwed.


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## BlueRidgeGreen (Apr 21, 2012)

Then there is the even more common scenario which happened to me again this spring and caused me to change my contract. The HO went and ordered seconds of the tile we had agreed on without telling me and it took me an extra 8 hours to tile the bathroom to my standards. 

Now show me how charging for my time is unethical.[/QUOTE]

Ethan...the beauty of this deal is that.....spec the tile you want, if she shows up with substandard ****e (and I hear you, nothin' makes me crazier than a job that should take 4, but takes 8 due to incompetence or crap material).......you still get paid for the 8. It's a no-lose if you just demand a good hourly, commensurate with your skills and experience. 

And, charging ENOUGH for your time is sweet like honey.....


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## BlueRidgeGreen (Apr 21, 2012)

elite173 said:


> You’re in business to make money? You would think. Estimate the job and bid accordingly. Working by the hour will pay for you to eat peanut butter and jelly sandwiches only. You will feel satisfied when you’re done eating but when you run out of food you wont have any funds left for you to pay for your phone bill, or fuel to drive your Vehicle to purchase the next sandwich. Overhead is vital to remaining in business....


 Overhead is simply factored into hourly. I am sure there are a lot of guys out there that have made a fine living on an hourly wage. I have witnessed many times a high-dollar hourly Samurai cruise onto a job and walk away with champagne while the "big dogs" were scroungin' after scraps to make the nut. 

There are many ways to skin a cat (but skinnin' cats is probably minimum wage, and a shi!!y thing to do).


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## Bunited2 (May 30, 2011)

Driftweed said:


> .........
> I sent one guy to Menards 3 times/day for a month straight because he couldn't figure out pex fittings. He said he would never do that again.
> 
> An 8 day job stretched out for 4 60hr weeks.


Ok, now this thread's entertaining.

Did the HO set you up with a bedroom too?

Walk in, in the middle of the night and see him and his old
lady making the 'beast with 2 backs'....sit down in the chair
eating a big old hoagie?


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## Bunited2 (May 30, 2011)

I always did Commercial and Industrial, I had very
little customers tell me they could get the equipment
(usually used from another company's surplus), I told
those few that the equipment will not be covered under
my warranty and if it ends up defective at all, I cant 
cover it on repair and replacement on my labor warranty
either....put an end to that crap right quick.


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## EthanB (Sep 28, 2011)

BlueRidgeGreen said:


> Ethan...the beauty of this deal is that.....spec the tile you want, if she shows up with substandard ****e (and I hear you, nothin' makes me crazier than a job that should take 4, but takes 8 due to incompetence or crap material).......you still get paid for the 8. It's a no-lose if you just demand a good hourly, commensurate with your skills and experience.
> 
> And, charging ENOUGH for your time is sweet like honey.....


It wasn't a T&M or Cost+ contract. If I do either of those then it's no sweat off my back. I prefer a Cost+ contract because I can then still fold my sundry materials into the + without having to worry about the customer spending extra money buying individual items that I normally buy in bulk such as a pound or two of fasteners, random fittings, etc.. Those are rolled into my markup, not my hourly rate. It's just the way I do things.

The OP specifically stated that the customer wanted "labor only" prices which, to me, indicates a fixed price bid.


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## perk (Dec 18, 2011)

*Bidding Update*

:blink:Hey guys I went to the customer and went over my labor cost and express that it is an estimate which may get higher for unforseen events which it always is. That did not go over well, it turned into explaining what is meant by that . I was interrogated on every little detail.


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## ryanshull (Nov 1, 2012)

perk said:


> :blink:Hey guys I went to the customer and went over my labor cost and express that it is an estimate which may get higher for unforseen events which it always is. That did not go over well, it turned into explaining what is meant by that . I was interrogated on every little detail.


Unless you are desperate, Run. Far and fast. You have already wasted too much time if they are acting like that. Some jobs just aren't worth doing.


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## Driftweed (Nov 7, 2012)

Bunited2 said:


> Ok, now this thread's entertaining.
> 
> Did the HO set you up with a bedroom too?
> 
> ...


Lol not quite. It was his first rental (vacant). We met at 8 a.m. , he would show me what he got. I write 1/2" pex clamps, T's, elbows, couplers and he brings me eveything in 3/4". Or female 3/4 to 1/2 barb... he'd get it bacwards.

8 a.m. to 6 p.m. mon thru sat paid cash in hand daily. Cant complain bout that.


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## PCI (Jun 8, 2012)

I don't think some of you get the idea of labor only on a flip type project. When I do these for investors, they write the checks for materials and pay me for labor and supervise (subs, deliveries, etc). I don't charge an hourly carpentry wage (say $30/hr-a made up rate) I charge an hourly rate of $75/hr (a made up rate) which compensates me for my experience, my expertise and my supervisory role over my subs, my supply of tools and an occasional fastener. 

This covers no materials, if I need a tube of caulk they pay for two just in case. They can return it if I don't use it.

My overhead, profit and labor rate is built in to the hourly. There is no peanut butter sandwich, only steak sandwiches.

This set up is a win win. I am guaranteed a profit with no chance of a loss. The customer is confident that they are not being charged my profit on top of a subs profit. They also no they are not paying for the unforseen charge I put in on proposals that I bid out right.


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## cwatbay (Mar 16, 2010)

perk said:


> :blink:Hey guys I went to the customer and went over my labor cost and express that it is an estimate which may get higher for unforseen events which it always is. That did not go over well, it turned into explaining what is meant by that . I was interrogated on every little detail.


Gee. I am really shocked. I would definitely not do this job. They want to be the "BOSS", they want to cut corners and supposedly save money. At least that is what I am reading so far. 

They say they have been burned in the past. Burned by who? Cheap unscrupulous contractors? In my experience, people who's mindset is that (a) all contractors are all the same, (b) licensed or unlicensed...doesn't matter which, (c) the only thing that matters is price......ie: you get the same quality whether the price is high or low. 

When people want to buy their own materials, many time it's because they don't want you to make a profit on it, and, they figure that any moron can buy materials.........which actually is a true statement when these folks go out and buy the materials themselves. 

Maybe I am reading too much into this, but, I have had a couple of occasions where for one reason or another, the client insisted on buying the materials themselves. In one case (an electrical engineer type...the worst) he figured he knew more than me........he was never happy, the stuff he bought on line was crap, he ripped out most of what we installed, he ended up spending twice as much money buying more crap that ether he or someone else had to re-install). 

In the other case, the client's step-son worked for a wholesaler. She saved a whopping 2% off what I would have charged for materials. I actually came out ahead quite well on this job, but she ended up spending the 2% saved on replacing electro-mechanical devices that didn't work quite well.


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