# Is this client trying to Lowball me? Please Read



## TurnkeyConst (Feb 14, 2007)

I recently met a client through my material supplier. She lives in a ritzy country club neighborhood. I am in no way ever trying to make a living on any 1 project. I feel being fair to each and every customer is the only way to be. My dad started the business when I was 13 and I feel to stand behind what he has done for many years. So with that said, here is what has happened.

I recieved the plans for the job, from my material supplier and was only supposed to price the framing on the job and that is it. 

The lady arranged a meeting with me in which she asked if I could contract the entire job. The only thing that doesnt have to be installed is the foundation as she has already had it installed per engineered drawings. So I decide that I will work on the figures for the 22'x28' Pool House....keep in mind this thing gets a 8x14' swim spa that costs $38k

Some specs on the job are as follows:
-Framing of 2x6 walls, with r-19 faced batts
-Roof framing 2x10's 2' oc
-Overhangs framed from 1st rafter in w/ ladders for full support
-3 skylights that are touchpad controlled to open when humidity rises and automatically shut when they detect rain
-40yr Architectural Shingles
-16' Front Gable all roofs 7/12
-Brick Veneer installed by her mason but material figured by me
-Pella Designer Series alum Clad French Door w/ Grilles and Blinds btwn glass
-2 sets Slider Pella Designer Series Alum Clad Doors w/ same grilles & blinds
-Hardi-Panel Finished Interior Walls, Ceilings
-Full Bathroom w/ Shower using Delta Fixtures and Fiberglass Shower
-Bamboo Flooring in The entire project
-16x22 2 Level Deck w/ 2x6 decking boards
-13x16 Vinyl Pergola on 8x8's
-The front Porch of the pool house will have beaded ceiling and Fypon Dentil Crown 2 3/4"
- All doorways get 13" Fypon Crossheads, Keystones and 5" Pilasters
-All Fypon Gable Vents and Front Gable Vent
-Pre Finished Hardi panel on the vaulted ceilings, exterior where the porch leaves the brick veneer structure as well as on front gable
-primed hardi panel on the walls to be painted and battens
-The job will require 9 - 14" Fiberglass Split Round Columns finished smooth

-HVAC is a high end 3 ton Carrier Heat Pump using the Infinity Thermostat w/ ductwork to be ran from the basement through the floor and then exposed spiral overhead painted white to blend in with the ceiling and will run 12'

-Electrical will have a new 200 amp service, and run the swimspa, 3 ceiling fans, bathroom light, all receptacles to be GFI and many others

-Plumbing is for the entire bathroom, water heater, 2 hose bibs, as well as many other things involved

Im sure there are many things I didnt mention here that are also included.

So I meet with her on a wednesday.....on friday I get an email asking me if I can have the entire estimate ready the following friday???

So I will do my best. I get an extension to the following wednesday. So I pick subcontractors that I know will get the job done right to bid the projects plumbing, hvac, and electrical.

I meet with her and here is a break down of what I came up with:

Materials: 59,261.60 $
Labor: 27,316.14 $
Sub-Contract Work: 25,798.40 $
with a total of 112,376.14 $

She tells me that she had 3 other estimates and that she didnt give anyone else a second chance and that they came in between 85k - 95k

She tells me since they are much bigger companies I should be able to come in around 75k....all the while her father was a home builder until he passed away.

She keeps throwing a magazine article in my face as to how it will be featured in a magazine when finished and that will be free advertising for me with high end clientele. She also tells me she has a lot of other work she wants done as well.

She went through and told me where I should be able to cut costs....like make pella give you the absolute lowest prices and also that I needed to get my materials down to 50k, and my sub work to 14k and my labor to around 20k.

So I just let her talk and dont try to tell her it isnt rational. My father and I do all the carpentry and framing most of the time to ensure quality! 

I decided to try and price subbing everything. Well even after re-calling in the week i was given to re-estimate the job. Here I am up @ 3am getting things together before my noon appt.

I have gotten 4 estimates on everything and every single company is pretty close together and I called each company to tell them how they faired and some lowered their prices by a few hundred $$ but not by thousands!!

So here are my new figures after 1 week of trying to re estimate

Material: 55,206.70
Labor: 23,605.58
Sub Work 24,710
Total being 103,522.28

Clearly it isnt 20k lower. 
I dont see how in any way possible it could be. I have hounded material suppliers that I buy from for the best possible prices to try to help with the job, but i just havent had any luck.

Today I finally told myself I am not going to let someone haggle me out of everything I have worked for just to do their job. I have a family to feed and business to run and I cant work for free.

What do you guys think? Does it sound like she is just trying to get me to drop my prices? She is always asking me how early I would be able to start....but never saying she can have the other companies start right away. When she talks to me its always...how soon can your plumbers connect everything to city water....or how long do you think it will take you to get the permit?? Its always how long do you think it will take YOU!?!?!?!?

Does this sound like she is trying to get the best of me?

I am young and she seems to have alot of money, so maybe she is trying to push me around?? I dont know, its my first time really dealing with someone that wants to spend 100k on a building the size of garages I build for 30k. 

Hope to hear from you guys. I would post the plans but the file is 10 megs.


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## BobsLandscaping (May 25, 2009)

At your meeting give her the original estimate for $112,376.14.

"Ma'am, this is my price for the project. If you do not currently have the means to do this work I will be happy to go over the proposal. Perhaps we can reduce the scope of work to fit your budget. Other than that there isn't much I can do. My prices are firm."

If she's going to be a PITA make it worth your while to work for her. Here's what's going to happen if you lower your prices. You gave her an inch, now she wants a mile. It'll start small, an extra little thing to do on your way out the door, change a color, stuff like that. Pretty soon you'll be coming home everyday mad as hell. Your marriage will suffer and you'll be hating life.


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## Mike(VA) (Jan 9, 2008)

Yes, she is trying to get you to lower your prices. Happens all the time when you don't ascertain the client's budget constraints ahead of time. Most have no clue what something costs until they get a proposal like yours. Others DO know but now days think all contractors are starving and will do anything for work.

I cut my prices all the time when I just cannot get a client to tell me their budget, especially when they have no clue. It goes something like this:

"Your proposal came in a bit higher than we (thought, can afford, want to pay) and we really like your work and the others were more in line with our thinking so can if you can get your price down, we really want to go with you."

"Ok, I am at $80K, you want to be at $65K. Let's look at the Scope of Work and see what we can eliminate or reduce to get the price down to the level you are comfortable with."

That approach is successful more often than not IF you have sold the client on the value of your service. They will be more than willing to work things so that a lower price can be realized. If not, then so long.


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## Mitch M (Dec 4, 2006)

I tell you what Turnkey. Me and some of the guys will give her a proposal for $125,000 +. That will make your quote look sweet!!!!:thumbsup:


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## Mitch M (Dec 4, 2006)

Seriously, it is not worth it. Give her the lump sum price. Do not break it down. Politely tell her it is what it is. If the others can do it that cheap let them. Either you will be taking their place or you will start getting the work that they would have had because the are no longer in business.


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## silvertree (Jul 22, 2007)

You got to know when to hold, know when to fold, know when to walk way, know when to run.

She's lying, hold at your original price:thumbsup:


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## SLSTech (Sep 13, 2008)

Lets see - you can simply say what I heard from another contractor "sure we can build it that cheap but you won't like it"

There is some good advice above - your price is your price


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## TurnkeyConst (Feb 14, 2007)

BobsLandscaping said:


> At your meeting give her the original estimate for $112,376.14.
> 
> "Ma'am, this is my price for the project. If you do not currently have the means to do this work I will be happy to go over the proposal. Perhaps we can reduce the scope of work to fit your budget. Other than that there isn't much I can do. My prices are firm."
> 
> If she's going to be a PITA make it worth your while to work for her. Here's what's going to happen if you lower your prices. You gave her an inch, now she wants a mile. It'll start small, an extra little thing to do on your way out the door, change a color, stuff like that. Pretty soon you'll be coming home everyday mad as hell. Your marriage will suffer and you'll be hating life.


This is exactly what I have come to realize the past few days. Its not worth doing a job, if im not going to be happy. Regardless of who they are. I normally try to co-operate and work with everyone, but I have been in the give an inch take a mile deal once before and it ended up in not getting paid for all the work I had done.


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## bwalley (Jan 7, 2009)

Give her your bid and if she doesn't like it, she can hire someone else.

Why would you even consider working for a client who wants you to lose money on a job?


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## TurnkeyConst (Feb 14, 2007)

Mike(VA) said:


> Yes, she is trying to get you to lower your prices. Happens all the time when you don't ascertain the client's budget constraints ahead of time. Most have no clue what something costs until they get a proposal like yours. Others DO know but now days think all contractors are starving and will do anything for work.
> 
> I cut my prices all the time when I just cannot get a client to tell me their budget, especially when they have no clue. It goes something like this:
> 
> ...



I tried to tell her that the materials were very expensive and that is the reason that the quote is so high. After running the materials through 4 different sources, as well as speaking to a few company reps, there is no way anyone can get the products that I am buying another 10k cheaper. I dont mind lowering the price, but in another aspect:

If I was to lower the price by using a different brand of materials other than what the plans call for or using cheaper building practices from that, that differ from the architectural drawings.....when I install that trim that isnt Fypon she can come back and say....this is not what was on the plans and I am not paying for it.

My work is how she was referred to me and the previous person told her I wasnt the cheapest. So as far as trying to cut out to someone elses figures.....I believe I am going to pass.

A remodeling job that is more labor than materials is one thing, but a job that is 75% materials no way!


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## TurnkeyConst (Feb 14, 2007)

Mitch M said:


> I tell you what Turnkey. Me and some of the guys will give her a proposal for $125,000 +. That will make your quote look sweet!!!!:thumbsup:


:clap::clap::clap::clap:
That would be great lol.....when can you submit hehe
:thumbup::thumbup::thumbup:


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## TurnkeyConst (Feb 14, 2007)

silvertree said:


> You got to know when to hold, know when to fold, know when to walk way, know when to run.
> 
> She's lying, hold at your original price:thumbsup:


You wont believe it, but right before we went to bed and I was putting my stuff up this song came on the radio!! It left me thinking all night in my sleep!

.....maybe she is bull****ing me and doesnt have any other quotes, maybe she is just telling me what she wants to pay for everything, or what someone else has told them they have in it minus overhead.

......im not working on a 100k job for labor only!! 
Thanks for posting !!!!!! :thumbup::thumbup:


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## TurnkeyConst (Feb 14, 2007)

SLSTech said:


> Lets see - you can simply say what I heard from another contractor "sure we can build it that cheap but you won't like it"
> 
> There is some good advice above - your price is your price



Thanks! I agree...to get cheap...you have to cut somewhere else....not worth ruining my name to satisfy 1 person.

I have kids that need to grow up and not have to worry about daddy having a job, because some dang customer, thought they could drive me in the ground.


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## TurnkeyConst (Feb 14, 2007)

bwalley said:


> Give her your bid and if she doesn't like it, she can hire someone else.
> 
> Why would you even consider working for a client who wants you to lose money on a job?


....and the funny thing is, she kept saying...."I know you have a family to feed and bills to pay....so I dont want you to cut your Labor, but I want to see the Material and Subcontractors drop by 25percent" - HAHA:laughing::laughing:

Sure I can cut out my overhead and drop 8k, but then I virtually work solely for my labor....as I put it to one person, what happens if I drop that set of Pella 3k$ doors and it tears it up
......if I have cut out my overhead who is going to pay for that new set?

Im sticking with my original bid!


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## deckman22 (Oct 20, 2007)

My golden rule for selling is, never lower the original price.

The promises of being in a magazine & more work is just BS, you know it, I know it & so does everyone else including her.


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## TurnkeyConst (Feb 14, 2007)

deckman22 said:


> My golden rule for selling is, never lower the original price.
> 
> The promises of being in a magazine & more work is just BS, you know it, I know it & so does everyone else including her.


*The promises of being in a magazine & more work is just BS, you know it, I know it & so does everyone else including her.*

Thanks for re-assuring me others think the same way!


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## Mike(VA) (Jan 9, 2008)

I'd be careful if you stick with your original bid. You said material costs were 75%? You haven't priced this job right if that is the case. 

Correct me if I am wrong, but unless you have included OH&P in the numbers below, where are you making any money?

Materials: 59,261.60 $
Labor: 27,316.14 $
Sub-Contract Work: 25,798.40 $
with a total of 112,376.14 $

If those are unloaded numbers, then my bid would look like this:

Materials: 59,261.60
Labor: 27,316.14
Sub-Contract work: 25,798.40
OH&P: 50,569.26
Total: 162,945.40

When you have a client who wants to see material and sub-contractors drop by 25%, that is someone who is reading some advocate's blog on how to get a better deal from contractors. How to be a GC, blah, blah, blah. No, I would never substitute inferior or lesser quality materials in lieu of specifications. Change the specs.

Bottom line is: she wants your work at someone else's prices. Change the scope and she gets your work at a lower total cost.


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## Anti-wingnut (Mar 12, 2009)

TurnkeyConst said:


> She tells me that she had 3 other estimates and that she didnt give anyone else a second chance and that they came in between 85k - 95


If that is true, then why is she giving you a second chance? You're $37K high.


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## TurnkeyConst (Feb 14, 2007)

Mike(VA) said:


> I'd be careful if you stick with your original bid. You said material costs were 75%? You haven't priced this job right if that is the case.
> 
> Correct me if I am wrong, but unless you have included OH&P in the numbers below, where are you making any money?
> 
> ...



The numbers that are above I did include my 10%. I have tried to show OH&P seperate before and was questioned to no end as to what it covers.....I got tired of explaining. So as far as the original estimate and final #'s they include 10% for overhead and profit. Sorry about that....i didnt really figure it up that they were @ 75%, was using the term a little sarcastically as to how much material is figured.


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## TurnkeyConst (Feb 14, 2007)

Anti-wingnut said:


> If that is true, then why is she giving you a second chance? You're $37K high.


Because supposedly the reason is that I am a remodeling contractor and not a custom home builder, as who the people are that bid on the project....she wants to work with someone she can refer remodeling business to from her professional staging company. who knows more BS in my book.


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## Mike(VA) (Jan 9, 2008)

Not trying to get on your case here, but at 10% for OH&P on a job this size, you WILL lose money. If this were me, I would withdraw my bid immediately before she changes her mind. Seriously. Think about it; you miss your estimates by 10% and you are at break even. You run over by 15% due to factors unseen and unknown, and you will lose money. You miss your estimates AND encounter unknown and unseen issues, you will be paying her. She has more experience than you and she will work you over. You will eat costs that you shouldn't and end up regretting the entire job. 

Get out while you still have the shirt on your back, and I am not joking.:no:


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## TurnkeyConst (Feb 14, 2007)

Mike(VA) said:


> Not trying to get on your case here, but at 10% for OH&P on a job this size, you WILL lose money. If this were me, I would withdraw my bid immediately before she changes her mind. Seriously. Think about it; you miss your estimates by 10% and you are at break even. You run over by 15% due to factors unseen and unknown, and you will lose money. You miss your estimates AND encounter unknown and unseen issues, you will be paying her. She has more experience than you and she will work you over. You will eat costs that you shouldn't and end up regretting the entire job.
> 
> Get out while you still have the shirt on your back, and I am not joking.:no:


If I stick with the original bid that would boost my OH&P to 20%. I see what you are saying for sure. I am going to go back to the table once more with the original bid. I understand the unforseen things and have ran into them on other projects. I also know on several of the materials I can get further discounts that I didnt figure into the job, or otherwise there would be no reason for me to go to certain suppliers.


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## J F (Dec 3, 2005)

10% for overhead AND profit? you're already giving the job away...

And she's raising these classic red flags:

1) She's got multiple bids much lower than you (but is still dealing with you when the low price is most important to her :shifty
2) She's got "other work" for you if you can just take a beating on _this_ project...we all like to look forward to _more_ projects we can lose money on, huh?
3) The work is going to be in a _magazine!!!_ (praise the lord!) ... it' will be FREE advertising for _you_...

I'm sure there were more, but my hand is hurting...just like your a$$ will be if you get involved with this "lady".


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## TurnkeyConst (Feb 14, 2007)

J F said:


> 10% for overhead AND profit? you're already giving the job away...
> 
> And she's raising these classic red flags:
> 
> ...




So let me ask you....what "if" I go back to the table and raise my price 30%. Tell her upon further review of my estimate I realized my original bid was actually causing me to lose money. So after review I realized to cover the entire project to finish my price is $146,500.

That would do 1 of 2 things....piss her off --- im sure, as well as help cover my @$$ in case of problems. 
What do you think?


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## Mike(VA) (Jan 9, 2008)

Pull your bid. You will lose if she signs it and you cannot raise it now after all this. Wipe your brow and thank us for saving you from yourself. :clap::laughing::laughing::blink:
I know it hurts and you hate to see potential money go away, but that is what would happen if you go through with this. :sad: Get it right with the next job.


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## J F (Dec 3, 2005)

What's your gut tell you? If it says walk...walk. 

Just _for our amusement_, I'd love for you to go back to her with a price that has some actual profit in it and record the aftermath..:laughing:


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## J F (Dec 3, 2005)

And ya never know, you may all of a sudden become the "must have" guy...stranger things have happened. Just don't count on it.


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## TurnkeyConst (Feb 14, 2007)

J F said:


> What's your gut tell you? If it says walk...walk.
> 
> Just _for our amusement_, I'd love for you to go back to her with a price that has some actual profit in it and record the aftermath..:laughing:


That is my plan....I am aggrevated that I let someone try to tell me where I could save....if she knows where to save let her contract the job and save. At this point Id be more happy to be told im too high, than to tell me I got the job, because if so she lied and I cant trust her at all. I will let you guys know!! Currently typing the estimate up have the meeting in 1 1/2 hrs.


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## TurnkeyConst (Feb 14, 2007)

J F said:


> And ya never know, you may all of a sudden become the "must have" guy...stranger things have happened. Just don't count on it.


for sure I have counted on things that fell through and I still work 1 job to the next.....It aint happening again!!!!


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## J F (Dec 3, 2005)

Good luck, look forward to hearing the results. Be polite but firm with your price and processes.


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## TurnkeyConst (Feb 14, 2007)

J F said:


> Good luck, look forward to hearing the results. Be polite but firm with your price and processes.


Thanks for the help!! as well as all the advice!


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## Chris Johnson (Apr 19, 2007)

She lives in a ritzy area because she does thing like this to people like you.

Hold your ground, I would go original quote and add a few thousand for the addtional time you have spent screwing around with this damn thing at her request.


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## bwalley (Jan 7, 2009)

Run do not walk, but *run* from this job.


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## Darwin (Apr 7, 2009)

TurnkeyConst said:


> *She keeps throwing a magazine article in my face as to how it will be featured in a magazine when finished and that will be free advertising for me with high end clientele. She also tells me she has a lot of other work she wants done as well.
> 
> She went through and told me where I should be able to cut costs....like make pella give you the absolute lowest prices and also that I needed to get my materials down to 50k, and my sub work to 14k and my labor to around 20k.*


The ole classic," I got more work for you too" routine:laughing:
Plus the ole "I will get you free advertising--you'll be off and running with unlimited clients to service":laughing:

_You _should be able to cut costs? But what if you don't wanna? :laughing:

Honestly, ask her to be your partner in business, and then charge her a entry level, franchise fee of $112,376.14:blink:


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## Magnettica (Dec 19, 2006)

Wow, I learned a lot in this thread.


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## insane (May 27, 2009)

BUYERS ARE LIERS. 
Just think, how many have gone into A car dealer and told the salesperson that they got a lower price on the exact same car at another dealer.
This is basically the same scenario.

Tim


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## greg24k (May 19, 2007)

I agree with Mike, the numbers you posted don't make sense. You can do that job for around 90k and make a nice profit, this why other estimates came in anywhere between 85-95k, the 75k figure what she wants to pay is a bit to low. 

Good luck :thumbsup:


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## willworkforbeer (Mar 7, 2009)

Darwin said:


> The ole classic," I got more work for you too" routine:laughing:
> Plus the ole "I will get you free advertising--you'll be off and running with unlimited clients to service":laughing:


Been there, done that unfortunately. :wallbash:


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## TurnkeyConst (Feb 14, 2007)

ok guys.....the results are as follows let me recap...

I went back over the entire bid trying to make things even out t o her bids....
I learned one thing: there is no way anyone can do it w/ these materials!

So original pricing was 112k

after having all the subcontracting, labor and materials I had the price to

$92,511 without over head figured. So the figure after I added overhead i came up with.....

$103,522

So after talking to everyone on here especially Mike and J F

I decided to take my original estimate of 112k and add 3k to it.
I then presented her with an estimate of 115k
In my estimate I described every detail as to what was figured and what wasnt. Well much to my surprise she didnt tell me no. She asked what we could do now to lower the prices and I told her the only way is to look at the Scope of Work and decide what she thinks she can get done cheaper, or do herself.

So after that discussion she is still telling me she had lower estimates but makes this comment that tells me she was lieing in the beginning.....

....."A Contractor friend of mine told me that I should be able to do the job for less than 100k.." So with that said I think the estimates she claims to have gotten are all FAKE!!!

I dont think she got any at all but was running on the assumption of what others told her. I spoke with every bldg material supplier around and nobody has seen this set of plans. So who knows. I am glad that I stuck to my original price whether or not I could get anything cheapAler or not. I added 3k for my aggrevation in dealing with it!

Who knows if I get this job, but if I do or dont, I have learned many lessons that I may not have learned otherwise....

1) Get multiple estimates for any materials or subcontractors as you cant always trust the ones you think or they will be the ones screwing you.
2) Dont let a customer try to push you into their price range.....they are not me and neither is any other company. Do the work for what I have too, not for the price of others
3) Ritzy ppl are a pain in the butt!
4) Always estimate exactly what is on the plans and dont change or they will try to corner you into more!

Those are few of the lessons I have learned and I am sure there will be many more.

I appreciate all the input from you guys and it has helped me come to my senses and realize some jobs are not worth the taking! I would have felt accomplished to have walked away knowing I didnt stoop to her level!

I will continue to let you guys know how this project or bid progresses or ends. 

Thanks Guys!!! Hopefully one day I will be able to return the advice as you guys have.


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## kevjob (Aug 14, 2006)

:shifty:be careful with that one she has already exceeded my red flags for clients. :shutup:

When they say oh it should be this much, ask them how long they have been in business.


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## Mike(VA) (Jan 9, 2008)

This thread here is probably one of the best I have seen for its going from the original post to a (hopefully) sound resolution with all the elements we expect to see on CT. Anyone reading this will hopefully take something away from this that will be useful to them in their daily work lives. We all should pat ourselves on the back. :thumbup: 

Do we have a smiley for that?


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## TurnkeyConst (Feb 14, 2007)

kevjob said:


> :shifty:be careful with that one she has already exceeded my red flags for clients. :shutup:
> 
> *When they say oh it should be this much, ask them how long they have been in business.*


HAHAHAHA I have heard my dad say this before....I didnt even think of saying it!!! Man that would have been a good closing argument!


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## kevjob (Aug 14, 2006)

My dad had a million of them wouldn't even bat an eye and out came of those types of statements.

chnage your main thoughts #1 to Pleasing the right kind of customer.


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## TurnkeyConst (Feb 14, 2007)

Mike(VA) said:


> This thread here is probably one of the best I have seen for its going from the original post to a (hopefully) sound resolution with all the elements we expect to see on CT. Anyone reading this will hopefully take something away from this that will be useful to them in their daily work lives. We all should pat ourselves on the back. :thumbup:
> 
> Do we have a smiley for that?



And Special thanks goes to you Mike(VA) for making me come to my senses!!!!
:clap::thumbup::clap::thumbup::clap:


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## Darwin (Apr 7, 2009)

It seems to me the majority of folks with money are the tightest squeezers of us:surrender:.

who would'av thought? :laughing:


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## TurnkeyConst (Feb 14, 2007)

Darwin said:


> It seems to me the majority of folks with money are the tightest squeezers of us:surrender:.
> 
> who would'av thought? :laughing:



I once thought I wanted to work for ritzy clients..... I am now rethinking that idea....or at least next time I will figure 40% overhead to allow for ultimate wiggle room.


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## greg24k (May 19, 2007)

Darwin said:


> It seems to me the majority of folks with money are the tightest squeezers of us:surrender:.
> 
> who would'av thought? :laughing:


In some cases yes, but in most cases people with money spend theirs money wisely, rich or poor, nobody throws money around, unless money do not hold any value to that person. 
The original poster is thinking he is being lowballed, in the mean time he adds 3k just for aggravation... I think we all know where his bid is going to end up :whistling


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## naptown CR (Feb 20, 2009)

TurnkeyConst said:


> The numbers that are above I did include my 10%. I have tried to show OH&P seperate before and was questioned to no end as to what it covers.....I got tired of explaining. So as far as the original estimate and final #'s they include 10% for overhead and profit. Sorry about that....i didnt really figure it up that they were @ 75%, was using the term a little sarcastically as to how much material is figured.


I know this is a bit late but 10% as a gross profit unless you are throwing everything including the kitchen sink at the job as a hard cost will lose you money
naptown's estimating 101
Labor cost + burden ( ss wc, vac sick health insurance etc) x2
Include in above 2 hours for each estimated day of work time and add before multiplier.
Material cost including tax delivery etc x 1.8

subcontractor costs x 1.7

Miscellaneous permits dumpsters etc x 1.8




J F said:


> 10% for overhead AND profit? you're already giving the job away...
> 
> And she's raising these classic red flags:
> 
> ...


If I had a dollar for every time I heard that I would be retired in Tahiti by now.



TurnkeyConst said:


> I once thought I wanted to work for ritzy clients..... I am now rethinking that idea....or at least next time I will figure 40% overhead to allow for ultimate wiggle room.


Some can be ok some can be a pita. I have mostly worked for rich people.
One has to be careful and word contracts very precisely to avoid problems.


The funniest thing about rich people i have noticed is they have maids and nanny's that they pay fortunes to. But next time you are in a rich persons kitchen see if the sponge by the sink is cut in half to make two out of it. I have walked into countless 2 million + houses and all the sponges are cut. 
Mabe that's how they got rich.


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## greg24k (May 19, 2007)

TurnkeyConst, you can have this job in the pocket and make a nice profit. You playing to much with your numbers and you adding numbers for BS, and this is why you are off big time. If you material cost is almost 60k and your subcontractor cost >25k and you got labor cost worth 27k none of this makes sense.

You should be able to do this job for around 60k max if not better and the rest should be your profit. Stop playing games, and do your thing :thumbsup:


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## TurnkeyConst (Feb 14, 2007)

greg24k said:


> TurnkeyConst, you can have this job in the pocket and make a nice profit. You playing to much with your numbers and you adding numbers for BS, and this is why you are off big time. If you material cost is almost 60k and your subcontractor cost >25k and you got labor cost worth 27k none of this makes sense.
> 
> You should be able to do this job for around 60k max if not better and the rest should be your profit. Stop playing games, and do your thing :thumbsup:



Hmmm..... are you related to the customer? Because this is exactly what she seems to think....so I think you could come to NC build her something close to what she wants....and never receive a final check.

I tell you what....PM me your email address and Ill send you a portion of the plans and just from what you receive see what you can come up with. If you think you can construct this project, install everything that is spec'd out as well as sub the Electrical, Plumbing and HVAC than you can bring your tail on down here and build it. I will win the project at 100k. So the paychecks go as follows
You get 85k and ill take 15k. 
Well I think you should be on the next train down unless you really think what you are talking is sense.

So when you are ready I can list exactly what everything costs and if you can get the stuff 30% cheaper than I can.....well then feel free I will give you all her info.

Now if you dont think you can put your statements to reality....well then just keep thinking it can be done for 60k!


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## naptown CR (Feb 20, 2009)

The gauntlet has been thrown
Should I send the wife out for more beer?


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## TurnkeyConst (Feb 14, 2007)

naptown CR said:


> The gauntlet has been thrown
> Should I send the wife out for more beer?


oh yeah get her on it, ill send mine for jager and red bull!!


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## Mitch M (Dec 4, 2006)

TurnkeyConst said:


> I once thought I wanted to work for ritzy clients..... I am now rethinking that idea....or at least next time I will figure 40% overhead to allow for ultimate wiggle room.


I would have to say be careful on that. I have done work for a few rich folks. One basically threw his money away. The others watch pennies. Either way, charge what you have to do to stay in business and make a decent profit. As you said don't try and make it rich on one job. Play fair with your pricing and stick to your guns when they want to deviate and I think you will achieve a lot more.

As you have learned in this post, the question is what do you (the customer) want to delete or change in the bid to get the price down. ? One other thing I would like to mention if you do get the job, if she starts trying to still talk you down make sure she understands that everytime she wants a change from the original there is a large markup and she has to pay for your time regardless of whether she goes with the change or not.


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## Mitch M (Dec 4, 2006)

As for the magazine article, tel her you are looking forward to it. You would rather pay later. Don't count your chickens before they hatch.


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## rbsremodeling (Nov 12, 2007)

Mike(VA) said:


> This thread here is probably one of the best I have seen for its going from the original post to a (hopefully) sound resolution with all the elements we expect to see on CT. Anyone reading this will hopefully take something away from this that will be useful to them in their daily work lives.* We all should pat ourselves on the back. *:thumbup:
> 
> *Do we have a smiley for that?*


Feel free to use this if you want, until you find the back patting smiley


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## greg24k (May 19, 2007)

TurnkeyConst said:


> Hmmm..... are you related to the customer? Because this is exactly what she seems to think....so I think you could come to NC build her something close to what she wants....and never receive a final check.
> 
> I tell you what....PM me your email address and Ill send you a portion of the plans and just from what you receive see what you can come up with. If you think you can construct this project, install everything that is spec'd out as well as sub the Electrical, Plumbing and HVAC than you can bring your tail on down here and build it. I will win the project at 100k. So the paychecks go as follows
> You get 85k and ill take 15k.
> ...


It's a pool house for Christ sake 616 SF... don't make a big deal out of it, you did not mention anything to be a huge cost in that project, all basic stuff...If you never done anything like this or you have s-contractors who giving you HO rates, then you in the wrong business.


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## rbsremodeling (Nov 12, 2007)

naptown CR said:


> I know this is a bit late but 10% as a gross profit unless you are throwing everything including the kitchen sink at the job as a hard cost will lose you money
> naptown's estimating 101
> Labor cost + burden ( ss wc, vac sick health insurance etc) x2
> Include in above 2 hours for each estimated day of work time and add before multiplier.
> ...


NO one uses the multipliers that we do. Most guys would not believe it even if they saw it. They just don't use those kinds of markups. Different markets and overheads


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## ampman (Apr 1, 2009)

Darwin said:


> It seems to me the majority of folks with money are the tightest squeezers of us:surrender:.
> 
> who would'av thought? :laughing:


 thats why they have more than us


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## SLSTech (Sep 13, 2008)

greg24k said:


> It's a pool house for Christ sake 616 SF... don't make a big deal out of it, you did not mention anything to be a huge cost in that project, all basic stuff...If you never done anything like this or you have s-contractors who giving you HO rates, then you in the wrong business.


This stuff adds up pretty quick (I know the swim spa is not in the costs - until you hit the subs, but it is not cheap to do nor support it)



TurnkeyConst said:


> ....keep in mind this thing gets a 8x14' swim spa that costs $38k....
> 
> 3 skylights that are touchpad controlled to open when humidity rises and automatically shut when they detect rain
> 
> ...





> I have gotten 4 estimates on everything and every single company is pretty close together and I called each company to tell them how they faired and some lowered their prices by a few hundred $$ but not by thousands!!


Don't do that - you will get a bad rep & higher prices if it gets around



> I am young and she seems to have alot of money, so maybe she is trying to push me around?? I dont know, its my first time really dealing with someone that wants to spend 100k on a building the size of garages I build for 30k.


Part of the issue seems that you are not sure of your prices 
age, nah not really an issue
experience & confidence, yes


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## greg24k (May 19, 2007)

SLSTech said:


> This stuff adds up pretty quick (I know the swim spa is not in the costs - until you hit the subs, but it is not cheap to do nor support it)


I agree with you SLS, if you don't watch the cost and what your contract specifies as your responsibility goes, one will end up in the hole before they could blink. Hot spa is not part of the issue, so if it needs wiring and so forth- Extra cost should be applied above the contract. That is how you make money. Masonry is not an issue, he said she got her own masons and I don't know why or how he end up estimating the material for that.
Reading his whole treat and the more he types, the more inexperienced he sounds. I gave her $112... she said that everyone was 85-95k and she tells him he should do it for 75k. Now he recounts everything and comes up with 102k, deduct 3k from that for his aggravation and he already at 99k, but this numbers and nonsense is irrelevant here... nice little chit-chat for guys to have some fun. I'm sure if he sits down and put a little thought to it and approach the whole situation in a more professional manner, he can come up with a solid number and get the job. If he continue running to the bathroom and each time come up with a different number, his bid can only serve one purpose, and that is being used as toilet paper.


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## RayGoerdt (Nov 13, 2008)

Thanks for the up-date Turnkey, I think you handled this one well.

Ray


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## Crawdad (Jul 20, 2005)

It was another case of "If you'll work cheap, I'll keep you busy, working cheap!"

Glad to see you didn't go for it.


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## TurnkeyConst (Feb 14, 2007)

Crawdad said:


> It was another case of "If you'll work cheap, I'll keep you busy, working cheap!"
> 
> Glad to see you didn't go for it.


Exactly! I'm glad I didn't stay roped into her beliefs just because she knows I'm yung.

As my dad said, I might have been born yesterday, but I wasn't born stupid!"
So we just keep moving on, do the work we are known for which is quality!
I sure do sleep better at night knowing our work is appreciated! Thanks again guys!


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## J F (Dec 3, 2005)

...and next time anything similar comes along, keep in mind how much time you spent NOT getting the project (at least so far). 

So, either raise the hell out of your o&p % or start charging for all the "free" consulting on projects of similar nature.

Glad you stuck to your guns. :thumbsup:


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## Mrmac204 (Dec 27, 2006)

This is an outstanding thread. I've read all five pages  

Lauriewww.lauriescustomfinishing.ca


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## AmeliaP (Apr 22, 2007)

Good job sticking to your guns. That 30k+- that she wanted you to cut would be a lot of advertising $$$. Probably better spent than the magazine article. In all reality you could probably get an ad in the same mag cheaper.


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## ThrobbingThumb (Jan 5, 2010)

Turnkey:

It's nice to see another young professional in this business. I am also 25 and have been slowly building my business for the past four years learning more than I ever thought I would about business. This thread convinced me to join the ranks and start posting. You can spend 120k on an education and not learn half of what was said here...


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## CertifiedFunds (Sep 25, 2007)

TurnkeyConst said:


> The numbers that are above I did include my 10%. I have tried to show OH&P seperate before and was questioned to no end as to what it covers.....I got tired of explaining. So as far as the original estimate and final #'s they include 10% for overhead and profit. Sorry about that....i didnt really figure it up that they were @ 75%, was using the term a little sarcastically as to how much material is figured.


Are you saying you are charging a total of 10% for O & P ? Dude you must at once change that to 20%!!!!!!!


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## kevjob (Aug 14, 2006)

try 1.69 for markups


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## Arstivers (Jan 6, 2010)

I just went through that on a huge project that we tried to educate the customer from the beginning on what this will cost and then when he got our quote he still wanted to be $150k less. He told me the same old things like I have another guy who came in less ect. My answer is alway, why are you calling me then? Sounds like you got your guy, good luck. There are always cheaper guys, but cheap doesn't equal quality.


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## Builtmany (Dec 9, 2009)

Happens all the time in this lousy economy we are in. People think they can out smart or game you for a better number. 

I would tell her no tow proposals are normally the same. Ask her to white out the price and companies names so you can see if they are apples to apples comparisons. When they are not educate her about how the additional 30k-40k will be added after the job is started going line by line. 

Good luck. 

I bid 2 sets of stairs in the summer for the back of 8 ft sliders. 7 steps each all composite, footings and composite rails. $3000 in materials my price was $5500 total. The homeowner the told me other guys were half that. How? I have 3k just in materials so I asked what materials & never heard back.


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## BreyerConstruct (May 22, 2006)

Builtmany said:


> I bid 2 sets of stairs in the summer for the back of 8 ft sliders. 7 steps each all composite, footings and composite rails. $3000 in materials my price was $5500 total. The homeowner the told me other guys were half that. How? I have 3k just in materials so I asked what materials & never heard back.


It's amazing how many times I've heard this- the "other guy" was 20-50% less... but they almost never allow us to provide a no-cost side-by-side comparative analysis.

I think they know deep down that it's lower quality- but they don't want you to prove it to them... maybe they are hoping to get lucky...

~Matt


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## Builtmany (Dec 9, 2009)

BreyerConstruct said:


> It's amazing how many times I've heard this- the "other guy" was 20-50% less... but they almost never allow us to provide a no-cost side-by-side comparative analysis.
> 
> 
> ~Matt


IMO most of them are full of sheit  My price does not normally budge much but I guess they will try by stating off saying the other guy was half my price.


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## BrianFox (Apr 6, 2009)

The last few times I got the ole "well this guy will do it for this much...", I always ask to come see the work after theyre finished. I then try to explain to the HOs that if they can provide the quality I provide at such a low number,
I need to employ them...Ive gotten mixed reviews on that one.


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## Builtmany (Dec 9, 2009)

BrianFox said:


> The last few times I got the ole "well this guy will do it for this much...", I always ask to come see the work after theyre finished. I then try to explain to the HOs that if they can provide the quality I provide at such a low number,
> I need to employ them...Ive gotten mixed reviews on that one.


That's a good line but then you risk the HO saying you are arrogant and going with someone else. I just had some POS tell me I'm too arrogant. WTF?


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## BrianFox (Apr 6, 2009)

Builtmany said:


> That's a good line but then you risk the HO saying you are arrogant and going with someone else. I just had some POS tell me I'm too arrogant. WTF?


I try to say it in as much jest as possible, but youre right it does. Usually whip that out when its obvious Im not getting the job. Like the flooring job when I bid against a guy who would lay it @$1.25 sf.

I do believe some people see confidence / trust in your abilities as arrogant and in my opinion is not our problem. Craftsman should be direct and to the point of their execution and management of a project.IMO.


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## evelien (Jan 8, 2010)

Just remind her, that a low offering on the job doesn't mean she won't end up paying maybe even more then you would cost.

And if she won't listen, let her go. In any way, don't let it get to you. Good luck, Evelien


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