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LeMarr Plumbing, Inc.
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772 Posts
Discussion Starter #1
How many of you flat rate/ Up Front Price and so on.
I was scared to death when I started flat rate but I will not go back to T&M. Some cases I may T&M but not very often. Customers like to see what the cost is before any work is done w/ guarrantees.

In Christ,

Song Dog
 

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Always Something
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1,369 Posts
Most of my clients get flat rate, if I am dealing with a PITa, I tell them TnM.....so they think they are getting a better deal.Costs them the same at the end of the day. I prefer flat rate...makes everything easier when it's time to write them up.
 

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Flat rate here. I wouldn't go back, either, though there is an occasional job that I don't know any other way to do than T&M, I'm getting better at it.
 

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Flat rate here.

The biggest argument against fr is the fact that bargain hunters can cut you off and move on to the cheapest price.

The fact that you were able to get the bargain hunter off the phone instead of time wasted having to negotiate at the end of the job is almost always overlooked by those who say that though.

Serves two purposes, filters out the whiney bargain hunters - gives your customers ease in knowing in advance what they'll have to pay.
 

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residential service
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1,948 Posts
Flat rate here. I wouldn't go back, either, though there is an occasional job that I don't know any other way to do than T&M, I'm getting better at it.
ditto here. Although even then I will still frame it in some sort of flat rate system. For example: if I have to hand dig a water service leak, 9 times out of 10 the leak will be right where the water is coming up out of the ground and within 2' deep (code requires 12" deep here) but not always. So what I will do is explain where I expect it to be and give them a price of $319 per hand dug yard (I define a yard as 3' long by 18" wide up to 2' deep, this is of course not a cubic yard). This still gives me a flat rate framework but allows me to adjust for a leak that ends up being 10' away.
 

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residential service
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1,948 Posts
Flat rate here.

The biggest argument against fr is the fact that bargain hunters can cut you off and move on to the cheapest price.

The fact that you were able to get the bargain hunter off the phone instead of time wasted having to negotiate at the end of the job is almost always overlooked by those who say that though.

Serves two purposes, filters out the whiney bargain hunters - gives your customers ease in knowing in advance what they'll have to pay.
We cut the price shoppers off with our service charge. $59 gets us out there. If you are hung up on that, what are you going to say when we tell you it will be $615 (our average ticket last year) for the repair. We do lose some calls over it and occasionally when it gets a little slow I start second guessing myself but if I ever falter all I have to do is go on a couple of calls for "free" to remind myself why we charge the service fee.
 

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I use up front pricing, but not flat rate, since we quote almost all of our work. The few occasions that we do work by the hour I use T&M, we just raised that rate to $170.00 and hour per man because of the union pay increase and the cost of fuel. I base most of my estimates at $2150.00 per fixture, not including fixture cost.
 

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Retired Moderator
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6,781 Posts
I have always used T&M. I heard of a flat rate chart somewhere but never tried it. Where do you all get your flat rate info from?
If you want to keep it from reaching the wannabes then just pm it to me.
 

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LeMarr Plumbing, Inc.
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772 Posts
Discussion Starter #9 (Edited)
upfrontpricing.com (Randy Hilton) or you can google flat rate pricing, up front pricing and so on. You can find a few. Another I thought of is, I think, nspg.com(?)
You can set your cost. I, hopefully some day get a software. Cuz you need to update the FRP once to twice a year due to costs. With software you can change things and then print new guides.
Also, being a soon to be ex franchisee as of tomorrow:thumbup: is a plus:yes:
I have been waiting for this day since 90days ago when I gave them a written notice. Sometimes you get took and not get what you pay for. I am gonna quit before I get venting too harshly;) A person can be better off getting a cool logo and presentation training on how to present your company and pricing and do just as good and the $ is yours.

Maybe I can write something up on my experience as a Franchisee, so if anyone ever thinks its right for them, they can see one not so good opinion instead of good opinions of people who have large franchises, who was cut a deal in the beginning just to be apart of it. Its all about money. Ok, I am done. I will wait until later to go any further. Got to get past tomorrow. Got to do the right thing and do it legally. After tomorrow its fair game.

In Christ,

Song Dog
 

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LeMarr Plumbing, Inc.
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772 Posts
Discussion Starter #12
Shoot! Thats right. Thanks!:thumbsup:

In Christ,

Song Dog
 

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378 Posts
At this time I am working the flat-rate into my pricing.I currently charge a few ways.
-I charge a good hourly charge plus a small service charge to get me there.
-I just purchased Mr. Hiltons books within the past few months,so I am trying to ease into it.I have an ad coming out in Sept. that should triple my amount of incoming calls and should allow me to implement the flat-rate pricing.I do use it on occasion now if people want an up-front price for certain items.I'm having a awful time trying to get the diagnosis charge as everyone here is doing '"diagnosis" for free,but charging maybe 20.00 to cover gas.Any help here would be appreciated.
-And there are jobs where plans are available or insurance gigs that you must bid.
-Then there's family and friends...........never mind.:blink:
 

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Ridgid tool user
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4,909 Posts
I have always used T&M. I heard of a flat rate chart somewhere but never tried it. Where do you all get your flat rate info from?
If you want to keep it from reaching the wannabes then just pm it to me.
I started tm and then went to flat rate. I worked for another company and still had their book but threw out the prices and used the book for the tasking. I went with my tm fee-85 per hour is my labor rate and I base all my flat rate price off this. Example; to do a main line usually is under an hour-85. I then charged 50 for a machine fee(went towards maintance). So I would typically charge a customer 135 to snake their line out. When I went flat rate, I bumped it up a little to cover any hiccups and just say it's 150 to do a main line. All flat rate is doing a job for a set price. Anybody who's been doing plumbing for awhile knows how long something will take. Just figure your labor time + materials+plus a little extra and there you go.

I also have "add ons" for extra tasking. Ex. main line again but now it's through a roof vent-extra 25, pull toilet 75, etc.

My biggest reasoning for going flat rate was because it's an easier sell and I'm the worst salesman. Customers like to hear this is the price and that's it. For diagnosising problems(usually with hvac) I charge 85 to figure out the problem. I also tell the price over the phone. I advertise on craigslist(I know, I'm a loser) and this weeds out those who want a cheap price. Phone pricing has worked great for me and I plan to continue it.
 

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I'm suprised so many people charge a flat rate. How do you know you won't "open a can of worms"? Sounds risky.
As far as I can tell flat rate prices are based on worst case scenario, at least around here they are, my neighbor helped me discover this a month or so ago.
 

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Ridgid tool user
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I'm suprised so many people charge a flat rate. How do you know you won't "open a can of worms"? Sounds risky.
There have been a few jobs that I lost money doing flat rate but usually it works out for me. I'm quite happy with the switch.
 

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residential service
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1,948 Posts
I started tm and then went to flat rate. I worked for another company and still had their book but threw out the prices and used the book for the tasking. I went with my tm fee-85 per hour is my labor rate and I base all my flat rate price off this. Example; to do a main line usually is under an hour-85. I then charged 50 for a machine fee(went towards maintance). So I would typically charge a customer 135 to snake their line out. When I went flat rate, I bumped it up a little to cover any hiccups and just say it's 150 to do a main line. All flat rate is doing a job for a set price. Anybody who's been doing plumbing for awhile knows how long something will take. Just figure your labor time + materials+plus a little extra and there you go.

I also have "add ons" for extra tasking. Ex. main line again but now it's through a roof vent-extra 25, pull toilet 75, etc.

My biggest reasoning for going flat rate was because it's an easier sell and I'm the worst salesman. Customers like to hear this is the price and that's it. For diagnosising problems(usually with hvac) I charge 85 to figure out the problem. I also tell the price over the phone. I advertise on craigslist(I know, I'm a loser) and this weeds out those who want a cheap price. Phone pricing has worked great for me and I plan to continue it.
With all due respect and please do not misunderstand me because I am not suggesting you are wrong for charging what you charge (you have obviously thought it through to some degree) but I suspect you are doing well with phone pricing because A. I think most plumbing companies will not even do this and B. You're pricing sounds quite low, at least for my market. Our flat rate is currently based on $150 per hour and we are seriously considering going up to $175 or even $200 (for certain tasks) in the very near future. Again, I am not suggesting what you should or should not be charging but I get the feeling that your phone pricing is working because CL or no CL you may well be one of the lowest around. We could not survive @ $85 per hour.
 

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Hey smells,when we charge T&M there are charges such as materials,tool rental ,equipment rental,labor,permitting which are included in your pricing but extra in my world you know how it is.I don't think T&M businesses are as bad off as you think.If you manage your time,watch your moves and have calls lined up well,most days are good.:thumbsup:
 

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residential service
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1,948 Posts
Hey smells,when we charge T&M there are charges such as materials,tool rental ,equipment rental,labor,permitting which are included in your pricing but extra in my world you know how it is.I don't think T&M businesses are as bad off as you think.If you manage your time,watch your moves and have calls lined up well,most days are good.:thumbsup:
Do your customers not feel nickel and dimed though when you tell them it's X per hour and then there's a cable charge and an environmental charge and a whateverelsewillgetthebilluptowhereitshouldbecharge? I'm not kidding there is a local company here that adds $10 for disposable latex gloves and they call it an environmental charge. I'm certainly not against them charging it but they are supposedly a flat rate shop and that sort of thing completely defeats the purpose. It's a half step and it's confusing to the customer. I think you are much better off simply saying "Mrs. Jones, we are going to provide you with the finest plumbing service you have ever had and this is what it will require today" or however you want to say it. The whole purpose of fr systems, from the consumers point of view, is to provide the customer with price security before the work begins. This security has a certain value and can't be given with a t&m system. Maybe I'm wrong but when someone says "It'll be X per hour" and then start adding various other "charges" it makes me feel like I didn't get the whole truth. This past week we had hardwood floors installed in my bedroom and a hallway. We were quoted a price before the work began and authorized the work to be done. Well when it was halfway done I start hearing about haul off charges and transition strip charges. Now they didn't add up to that much and in my view are legitimate charges but I should have known the whole price before the work began. Now, it was excellant work and I would probably hire them again but I can't deny that it left me with a bit of a sour taste in my mouth just on principle. I can't imagine ever doing that to one of my clients. When I quote the price that's it that is the price.

Ok I guess I'm rambling now. I guess what I'm trying to say is pick a road and go down it. If it's t&m (which I would never personally knowingly agree to) then give me your hourly and your best estimate. If it's fr then tell me what the number is and don't add any silly little charges to it and don't dare try and change it later once you've given it. I just personally feel that t&m conveys a certain sense of not really being sure what the job will take which although it may not be justified at all can very easily make a customer not have the confidence in you that perhaps you might be due. I know others see it differently and that's ok. As for me though, having left t&m far behind, I can't imagine ever going back.
 
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