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Posted: 10/1/2014 4:12:37 PM EST
I know this might seem like an odd first post, but it's something I've been thinking of for a while and this is the largest forum I know of, most other forums would only get 2-3 replies.

This post is me giving some insight into a small business and how it runs. Maybe you will learn something or find a different point of view. I am sure that I will learn from many of the responses and opinions. That’s the point of discussion forums, right?

I’m an electrician, just a small time businessman trying to make a living and possibly a retirement. We mainly do residential service work, and it’s getting harder and harder.

Everyone says to get 3 estimates for all work you have done on your home, but those people saying it don’t understand how detrimental it is to the trades. Even the building departments around here have big signs saying to always get multiple estimates, and it scares customers from using contractors that they already trust.

Here’s the problem: billable efficiency. When it comes to construction type work, like wiring new houses and large renovations, I send my guys to a job in which they work from 7AM-3PM. They get paid for 8 hours but I charge the customer for 8 hours. That’s almost 100% billable efficiency (it’s slightly less due to the guys having to leave the job sometimes to get material, etc.).

So for the sake of using even numbers, let’s just say that in order to pay a journeyman level electrician for the year (2,000 hours), cover my overhead, and make a little evil profit, I have to charge the customer enough to make $100,000 per man for the year. So for construction or renovation work, I can charge $50/hr in order to make what I need to keep the employee working, pay my overhead, and make the company a little money. Sounds good, right?

I had to break this into multiple posts because there is a 2,000 character limit for new members.
Link Posted: 10/1/2014 4:13:08 PM EST
Now we go back to service work. Service work is the smaller type of work, repairs, installations etc. Fix a light not working, install some hi-hats, hang a TV, replace an electrical panel, add some outlets. etc. That’s my company’s bread and butter”.

The problem is billable efficiency with service work, it’s close to 50%, which is pretty bad. One of the biggest things hurting billable efficiency is going out to give estimates, I can spend 20-30 hours a week giving estimates, which is all lost time. The problem is that often it takes longer to give the estimate than do the work.

Example: Customer calls asking if we give a free estimate, we say yes. She wants us to come look at her bathroom switches and give a price for a timer. OK, we can do that over the phone, but she doesn’t want that. So we drive 20 minutes there, listen to her tell us her stories for another 20 minutes, then drive 20 minutes back because she needs to get a couple more prices before she decides. So thats an hour wasted.

Next day she calls and says she wants us to go ahead and install the timer. Another 20 minutes drive, 10 minutes to put the timer in, and now she complains that she is paying too much for 10 minutes worth of work. Well, it’s not 10 minutes, it’s another hour added onto the hour we spent the day before. But the day before was a free estimate, right?

Therein lies the rub. Nothing in business is free. The company owner or it’s investor doesn’t go into their own pocket to pay for your free estimate. They don’t take a loan out to pay the credit card fees for people who choose to pay with credit cards. Everything that is “free” is actually paid for by the customers, YOU.

So sure, you got a free estimate, but because all of those estimates we have to give “for free”, we have to raise our prices. That’s why service work is charged at $100/hr, because half of the time is wasted and unbillable.

Link Posted: 10/1/2014 4:13:22 PM EST
Do you have a 12 gauge?
Link Posted: 10/1/2014 4:13:38 PM EST
And finally:

Another issue some customers have is how much they pay for work when they feel it’s “easier work”. Here’s the thing, my electrician all want their full hourly rate, even if they are only wiring a doorbell or a phone. My insurance still costs the same thing, fuel still costs the same., etc. Yes, I know any homeowner can hang a fan themselves, but if you want a licensed, insured electrician you have to pay the rate. There is no “lower rate” the same way as the average hourly employee doesn’t get a lower wage when he is doing easier work.

So if you call me because your kitchen light isn’t working, and the electrician I send changes the light bulbs and it works, the service call fee is still the same. You might have been able to do it yourself, but you didn’t. I always mention to customers that they should try new bulbs when lights aren’t working or look for a “reset” button when their bathroom outlet stops works, but often they dismiss it and say to just come over and figure it out for them. But when they see how easy it is, they suddenly think they are entitled to free work.

Link Posted: 10/1/2014 4:14:10 PM EST
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Originally Posted By ARmory04:
Do you have a 12 gauge?
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Yes.

Are you going to ask me if I have a toe trigger attachment?
Link Posted: 10/1/2014 4:16:23 PM EST
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Originally Posted By Rctx:


Yes.

Are you going to ask me if I have a toe trigger attachment?
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Originally Posted By Rctx:
Originally Posted By ARmory04:
Do you have a 12 gauge?


Yes.

Are you going to ask me if I have a toe trigger attachment?




I wasn't.... But business opportunities abound.

Annnnndddd, TL;DR. Not cool first post n all that jazz.
Link Posted: 10/1/2014 4:19:17 PM EST
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Originally Posted By Rctx:
And finally:

Another issue some customers have is how much they pay for work when they feel it’s "easier work”. Here’s the thing, my electrician all want their full hourly rate, even if they are only wiring a doorbell or a phone. My insurance still costs the same thing, fuel still costs the same., etc. Yes, I know any homeowner can hang a fan themselves, but if you want a licensed, insured electrician you have to pay the rate. There is no "lower rate” the same way as the average hourly employee doesn’t get a lower wage when he is doing easier work.

So if you call me because your kitchen light isn’t working, and the electrician I send changes the light bulbs and it works, the service call fee is still the same. You might have been able to do it yourself, but you didn’t. I always mention to customers that they should try new bulbs when lights aren’t working or look for a "reset” button when their bathroom outlet stops works, but often they dismiss it and say to just come over and figure it out for them. But when they see how easy it is, they suddenly think they are entitled to free work.

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so, what exactly is your problem with charging the customer?

and no, they are not entitled to "free work", even when it turns out to be something simple.


Link Posted: 10/1/2014 4:20:15 PM EST
That's a lot of shit to pour out.
Do you have Ebola?
Link Posted: 10/1/2014 4:20:30 PM EST
I hear you bro. If you don't give the estimates it's likely you'll never have a chance to get the business so that's your gamble

I'm one of those people who isn't DIY. I work and do what I do so I don't have to worry about shit like oil changes and car repairs and such. I'm not oblivious to things like that but I'd rather pay someone like you to fix it so it hopefully it's done right and if it's not I can bitch at you to get it fixed. I'm happy to pay what that costs to avoid the time and headache.
Link Posted: 10/1/2014 4:23:53 PM EST
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Originally Posted By Whizzinator:
so, what exactly is your problem with charging the customer?

and no, they are not entitled to "free work", even when it turns out to be something simple.


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In the situation quoted, it could be anything from an unnecessary argument to them simply refusing to pay what they agreed to.
Link Posted: 10/1/2014 4:28:34 PM EST
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Originally Posted By FourLoko:
I hear you bro. If you don't give the estimates it's likely you'll never have a chance to get the business so that's your gamble
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Originally Posted By FourLoko:
I hear you bro. If you don't give the estimates it's likely you'll never have a chance to get the business so that's your gamble


That's it right there.

When business is better I start charging a minimal fee for estimates. That works really well to weed out the "tire kickers". I will tell them that it will cost $29 for the estimate and that $29 will be credited into the job if they choose to have us do it.

I know other electrician who do that when they are pretty busy. But when you are not too busy and looking for a good amount of new work, you have to give free estimates.

I'm one of those people who isn't DIY. I work and do what I do so I don't have to worry about shit like oil changes and car repairs and such. I'm not oblivious to things like that but I'd rather pay someone like you to fix it so it hopefully it's done right and if it's not I can bitch at you to get it fixed. I'm happy to pay what that costs to avoid the time and headache.


You are my prime customer. I have many customers like you and I value them greatly.

And after doing a few jobs for you, I'll happily come to your house at 6AM on a Sunday morning to change a light bulb that you can't reach, and I won't charge you for it.
Link Posted: 10/1/2014 5:50:23 PM EST
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Originally Posted By itsARanchrifle:
That's a lot of shit to pour out.
Do you have Ebola?
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Alright, so my first fail of many


This was mainly sparked up while listening to a conversation earlier today. A woman complained that a plumber charged her $119 to unclog her toilet with a plunger. Then everyone else in the room agreed how the plumber was a crook. One man said that she should call the state on him.

I tried to explain that she paid $119 for a service call which included a licensed professional to bring his rolling warehouse with tens of thousands of dollars worth of tools and material to her home to fix her problem, but instead of trying to understand what I was saying, she was too fixated on the fact that he used a plunger and she could have done that. When I asked her why she didn't do it, she said "I don't have a plunger and it's too icky anyway".
Link Posted: 10/1/2014 5:53:56 PM EST
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Originally Posted By Rctx:



Alright, so my first fail of many


This was mainly sparked up while listening to a conversation earlier today. A woman complained that a plumber charged her $119 to unclog her toilet with a plunger. Then everyone else in the room agreed how the plumber was a crook. One man said that she should call the state on him.

I tried to explain that she paid $119 for a service call which included a licensed professional to bring his rolling warehouse with tens of thousands of dollars worth of tools and material to her home to fix her problem, but instead of trying to understand what I was saying, she was too fixated on the fact that he used a plunger and she could have done that. When I asked her why she didn't do it, she said "I don't have a plunger and it's too icky anyway".
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Originally Posted By Rctx:
Originally Posted By itsARanchrifle:
That's a lot of shit to pour out.
Do you have Ebola?



Alright, so my first fail of many


This was mainly sparked up while listening to a conversation earlier today. A woman complained that a plumber charged her $119 to unclog her toilet with a plunger. Then everyone else in the room agreed how the plumber was a crook. One man said that she should call the state on him.

I tried to explain that she paid $119 for a service call which included a licensed professional to bring his rolling warehouse with tens of thousands of dollars worth of tools and material to her home to fix her problem, but instead of trying to understand what I was saying, she was too fixated on the fact that he used a plunger and she could have done that. When I asked her why she didn't do it, she said "I don't have a plunger and it's too icky anyway".

Maybe you should switch from electric to plumbing.
Link Posted: 10/1/2014 5:55:12 PM EST
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Originally Posted By ByNameRequest:

Maybe you should switch from electric to plumbing.
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Originally Posted By ByNameRequest:
Originally Posted By Rctx:
Originally Posted By itsARanchrifle:
That's a lot of shit to pour out.
Do you have Ebola?



Alright, so my first fail of many


This was mainly sparked up while listening to a conversation earlier today. A woman complained that a plumber charged her $119 to unclog her toilet with a plunger. Then everyone else in the room agreed how the plumber was a crook. One man said that she should call the state on him.

I tried to explain that she paid $119 for a service call which included a licensed professional to bring his rolling warehouse with tens of thousands of dollars worth of tools and material to her home to fix her problem, but instead of trying to understand what I was saying, she was too fixated on the fact that he used a plunger and she could have done that. When I asked her why she didn't do it, she said "I don't have a plunger and it's too icky anyway".

Maybe you should switch from electric to plumbing.


Why? Same problems.
Link Posted: 10/1/2014 5:58:14 PM EST
[Last Edit: 10/1/2014 6:06:06 PM EST by Aimless]
Link Posted: 10/1/2014 6:13:42 PM EST
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Originally Posted By Aimless:
I don't know how you can make money doing free estimates with only a 1/3, or maybe 50/50 if you assume you are better/cheaper, chance of landing the job.
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Originally Posted By Aimless:
I don't know how you can make money doing free estimates with only a 1/3, or maybe 50/50 if you assume you are better/cheaper, chance of landing the job.

The problem is that I'm not cheap. My prices are higher than average, but we sell ourselves on excellent work and service. Most of our work comes from previous customers or referrals, which we have a very high close rate. The problem is that finding new customers is hard, especially when the only thing the customer cares about is getting the lowest price, and they will call 4-5 contractors to find it

But sometimes we do find the good customers that are willing to pay a little more money to know that the job is done right, no corners were cut, and that the work will be stood behind.

you are burning up too many billable hours on free estimates. You need to charge more per job so you can afford an "estimate guy" who generates no income but hustles estimates. What if you had a guy who did estimates based on commission? -Snipped due to character count-

I hear you. I've looked into that, that type of thing comes with a larger company. I only have 4 men and 3 trucks (one of which is my own). I would need to build a much larger company in order to be able to support an estimator/salesman who is worth a crap. And even then, having 1 guy isn't as efficient as having the service techs out doing estimates (and hopefully closing the jobs and completing them, the main goal in service work). Usually contracting companies with employed estimators are doing construction/renovation work instead of service.

That's where Contractor Selling companies like Nexstar/ESI come into play, if you are willing to shell out the money and follow what they tell you, you can really do well. But I usually try to avoid being the shyster type guy and sell by being honest and helpful.
Link Posted: 10/1/2014 6:16:51 PM EST
There's no solution to your problem. That, unfortunately, is a fact of life in the service trades. Unless you are the only guys in town, you're not going to be able to change how the market operates.
Link Posted: 10/1/2014 6:20:42 PM EST
[Last Edit: 10/1/2014 6:21:22 PM EST by Mak_380]
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Originally Posted By Aimless:
<snip>
You should meet the appliance repair guy my wife found. That guy must be loaded. I've been there twice when he came. He says "hi what's broke?" No small talk. He pulls apart the dryer or whatever "$80 we got a deal?" Then runs out to his truck, grabs his gear, fixes it like in a minute "I'll mail a bill" and runs out the door.

Once he looked at my dryer "framistat's broke can't get em, too old, time to replace, bye"vrrroooooom
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What did you charge him for the consultation?

OP: $119 was too low. Asshole Abusive customer fee needs to be higher.
What if the plunger didn't fix it? Did she have a router? Auger? Replacement wax ring/mounting bolts?
Knowing the right tool for the job is part of the deal. New pricing structure: Base price, $45. Every tool I take off the truck costs $10 extra. (And for the abusive customers, bring out one of those 120 piece screwdriver sets!)
Link Posted: 10/1/2014 6:22:52 PM EST
Do you ever get people asking you to recommend another company? I get that shit nearly everyday and we just sell stuff.
Link Posted: 10/1/2014 6:23:47 PM EST
It sounds like you are paying your journeyman a fixed salary (i.e. not hourly based on the time spent at a customers house). If this is the case, are you so busy (doing both estimates and work) that you are turning down work? If the answer is yes, then you may need to consider hiring a professional estimator and/or charging a fee for estimates. If the answer is no, then your employees would not be fully utilized anyway. Meaning, you may as well be paying them to give free estimates as paying them to sit around.
Link Posted: 10/1/2014 6:24:49 PM EST
Link Posted: 10/1/2014 6:26:29 PM EST
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Originally Posted By Mak_380:

What did you charge him for the consultation?

OP: $119 was too low. Asshole Abusive customer fee needs to be higher.
What if the plunger didn't fix it? Did she have a router? Auger? Replacement wax ring/mounting bolts?
Knowing the right tool for the job is part of the deal. New pricing structure: Base price, $45. Every tool I take off the truck costs $10 extra. (And for the abusive customers, bring out one of those 120 piece screwdriver sets!)
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Originally Posted By Mak_380:
Originally Posted By Aimless:
<snip>
You should meet the appliance repair guy my wife found. That guy must be loaded. I've been there twice when he came. He says "hi what's broke?" No small talk. He pulls apart the dryer or whatever "$80 we got a deal?" Then runs out to his truck, grabs his gear, fixes it like in a minute "I'll mail a bill" and runs out the door.

Once he looked at my dryer "framistat's broke can't get em, too old, time to replace, bye"vrrroooooom

What did you charge him for the consultation?

OP: $119 was too low. Asshole Abusive customer fee needs to be higher.
What if the plunger didn't fix it? Did she have a router? Auger? Replacement wax ring/mounting bolts?
Knowing the right tool for the job is part of the deal. New pricing structure: Base price, $45. Every tool I take off the truck costs $10 extra. (And for the abusive customers, bring out one of those 120 piece screwdriver sets!)

Very good points, are you in the business?

I was told something by someone much wiser than me and I repeat it when the situation arises" Whenever a customer complains that what I did was easy, such as fix a power outage by tightening a lug that was lose, and the customer says something like "You want $99 just for turning a screw?" I always tell them "No, I want $99 for knowing which screw to turn".
Link Posted: 10/1/2014 6:28:34 PM EST
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Originally Posted By AeroE:
When the trades start showing up to do the work that is scheduled, then I'll give 'em some slack, maybe pick a guy that does good work for repeat business.

But it's not likely to happen.

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That right there is another thing that really kills my billable efficiency. We are ALWAYS on time.

But that means that I have to schedule more downtime between jobs to cover any overages.
Link Posted: 10/1/2014 6:30:54 PM EST
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Originally Posted By 999monkeys:
It sounds like you are paying your journeyman a fixed salary (i.e. not hourly based on the time spent at a customers house). If this is the case, are you so busy (doing both estimates and work) that you are turning down work? If the answer is yes, then you may need to consider hiring a professional estimator and/or charging a fee for estimates. If the answer is no, then your employees would not be fully utilized anyway. Meaning, you may as well be paying them to give free estimates as paying them to sit around.
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At this time work has slowed so my guys have downtime. I pay them hourly but always for the entire day, even if there is no work.

I will send them on estimates when necessary.
Link Posted: 10/1/2014 6:35:22 PM EST
Only think I can add, is get away from residential work. They all want something for next to nothing.
Link Posted: 10/1/2014 6:36:17 PM EST
We dont do free estimates on car repairs.We dont do phone quotes on repairs.
It takes time even if all I have to do is walk out with a scanner and see why the light is on. Ok Autobone will read your codes for free and advise the wrong part. When I read the code its evaluated against the 30 plus years of experience and education, when I do it its likely to be the real repair plan. Should you choose to not continue with my plan, I feel that the info I provided is of value. I deserve to be compensated for the time and expertise rendered to the customers request. I didnt go knock on their door and ask if I could check their car for them for free.
We are busy as hell and have been for years. Concentrate your efforts on the 90 per cent of your customers that are good repeat buyers, and blow out the ten percent who make your life hard.
Link Posted: 10/1/2014 6:51:36 PM EST
[Last Edit: 10/1/2014 6:52:45 PM EST by Soylent]
People getting competitive bids is just good sense on their part. There isn't any point in complaining about that.

You do have a good point about losing money on bids passed up for someone else, but that's the cost of doing business. I mean after all, if you didn't have to actually do any work and just sent a bill that would increase profits overnight. But you can't, so you do what you gotta do to get some work in the door. Maybe it's your approach, maybe it's your prices, maybe it's on the customer and they're a cheapskate, maybe it's just the way things go but lost opportunities to you (for whatever reason) is what makes it possible for other guys to get that work. It's why you have your business for that matter. Someone turned down some other guys bid and chose yours.

Nobody that has you come out to their house has any room to bitch about paying your fee. Whether it's a light bulb or a new service they told you to do the work, they have to pay the bill. I guess as long as they know the fee up front just to avoid any goofballs trolling for some company or free lights is all I can advise on that front.

Link Posted: 10/1/2014 6:58:14 PM EST
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Originally Posted By Soylent:
People getting competitive bids is just good sense on their part. There isn't any point in complaining about that.

You do have a good point about losing money on bids passed up for someone else, but that's the cost of doing business. I mean after all, if you didn't have to actually do any work and just sent a bill that would increase profits overnight. But you can't, so you do what you gotta do to get some work in the door. Maybe it's your approach, maybe it's your prices, maybe it's on the customer and they're a cheapskate, maybe it's just the way things go but lost opportunities to you (for whatever reason) is what makes it possible for other guys to get that work. It's why you have your business for that matter. Someone turned down some other guys bid and chose yours.

Nobody that has you come out to their house has any room to bitch about paying your fee. Whether it's a light bulb or a new service they told you to do the work, they have to pay the bill. I guess as long as they know the fee up front just to avoid any goofballs trolling for some company or free lights is all I can advise on that front.

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What you say is all true. I am not complaining as much as just having an open discussion and also trying to possibly educate some people on why the prices are so high.

Truth be told, a lot of people will break down my price in their head (always underquoting the material cost) and say "I can't believe you people make over a hundred dollars and hour, it's highway robbery!". They don't realize that it's no where near that, especially with the 50% billable efficiency.

Link Posted: 10/1/2014 6:59:38 PM EST
I am also a mainly residential EC.

You aren't looking at the big picture when it comes to billing and estimates. Part of your overhead thst should be calculated in figuring out your business cost is the office time and estimator.

If you need to raise your hourly prices, do it. Or charge for estimates. Otherwise, you are simply describing what happens in business.
Link Posted: 10/1/2014 7:01:08 PM EST
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Originally Posted By somedudefromhouston:
We dont do free estimates on car repairs.We dont do phone quotes on repairs.
It takes time even if all I have to do is walk out with a scanner and see why the light is on. Ok Autobone will read your codes for free and advise the wrong part. When I read the code its evaluated against the 30 plus years of experience and education, when I do it its likely to be the real repair plan. Should you choose to not continue with my plan, I feel that the info I provided is of value. I deserve to be compensated for the time and expertise rendered to the customers request. I didnt go knock on their door and ask if I could check their car for them for free.
We are busy as hell and have been for years. Concentrate your efforts on the 90 per cent of your customers that are good repeat buyers, and blow out the ten percent who make your life hard.
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Great information and I am right with you on this.

The question is how to get those better customers? The only way seems to be weeding thru the bad ones.

FWIW, I've talked to customers over the years and some of the best ones I've had who have given me a lot of work themselves and by referrals have said that they wouldn't have paid for an estimate when they first called me. Free estimates are the standard.
Link Posted: 10/1/2014 7:02:36 PM EST
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Originally Posted By itstock:
I am also a mainly residential EC.

You aren't looking at the big picture when it comes to billing and estimates. Part of your overhead thst should be calculated in figuring out your business cost is the office time and estimator.

If you need to raise your hourly prices, do it. Or charge for estimates. Otherwise, you are simply describing what happens in business.
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My prices are fine. Describing what happens in business is exactly what I am doing here
Link Posted: 10/1/2014 7:07:42 PM EST
[Last Edit: 10/1/2014 7:08:39 PM EST by itstock]
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Originally Posted By Rctx:

My prices are fine. Describing what happens in business is exactly what I am doing here
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Originally Posted By Rctx:
Originally Posted By itstock:
I am also a mainly residential EC.

You aren't looking at the big picture when it comes to billing and estimates. Part of your overhead thst should be calculated in figuring out your business cost is the office time and estimator.

If you need to raise your hourly prices, do it. Or charge for estimates. Otherwise, you are simply describing what happens in business.

My prices are fine. Describing what happens in business is exactly what I am doing here


Do you do work towards the shore points? I have been considering getting a full time crew going down there. Most of my customers have shore houses and are always complaining that there are no good electricians out there, either impossible to get a hold of, or they simply don't speak English. Is the market as good and ripe as they make it seem?
Link Posted: 10/1/2014 7:13:51 PM EST
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Originally Posted By itstock:


Do you do work towards the shore points? I have been considering getting a full time crew going down there. Most of my customers have shore houses and are always complaining that there are no good electricians out there, either impossible to get a hold of, or they simply don't speak English. Is the market as good and ripe as they make it seem?
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Originally Posted By itstock:
Originally Posted By Rctx:
Originally Posted By itstock:
I am also a mainly residential EC.

You aren't looking at the big picture when it comes to billing and estimates. Part of your overhead thst should be calculated in figuring out your business cost is the office time and estimator.

If you need to raise your hourly prices, do it. Or charge for estimates. Otherwise, you are simply describing what happens in business.

My prices are fine. Describing what happens in business is exactly what I am doing here


Do you do work towards the shore points? I have been considering getting a full time crew going down there. Most of my customers have shore houses and are always complaining that there are no good electricians out there, either impossible to get a hold of, or they simply don't speak English. Is the market as good and ripe as they make it seem?


No, I am in northern NJ. I know contractors who went down there during the boom but are all back up here now. I've spoken to a few shore contractors who are slow now because people are still waiting on insurance money.

I had no interest going down there because I like service work better, new housing and renovations like that is just too cut-throat.
Link Posted: 10/1/2014 7:17:21 PM EST
Boo hoo. There's ups and downs of every profession in every industry. Get used to it.
Link Posted: 10/1/2014 7:21:23 PM EST
My reply is the only thing in life thats free is your mothers love, and she is getting tired of your shit too. Free is worth everything you paid for it.
Link Posted: 10/1/2014 7:37:45 PM EST
Joe DIY'er here. CSB incoming!

HW heater had a small leak at the dielectric union. I can do many things, but I'm not a good plumber & I didn't have pipe wrenches. Called the local guys up the street. Didn't ask for an estimate, said just fix it. Wife is home, she'll take care of bill. Came home & got report: Very courteous, professional, clean & did a fine job. Looked at the bill, $100. $95 for the call, $5 for two washers @ $2.50/ea.

I was thrilled the HW heater dielectric union was no longer leaking! Then I got on Amazon & ordered a couple of pipe wrenches!
Link Posted: 10/1/2014 7:38:05 PM EST
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Originally Posted By netra709:
Only think I can add, is get away from residential work. They all want something for next to nothing.
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Any idea if commercial electrical companies have this same problem?

I plan on applying for some electrician apprenticeships by the end of the year, everyone I've talked to has warned me off residential work. I'm thinking commercial/industrial service sounds like a better way to go.
Link Posted: 10/1/2014 7:41:06 PM EST
Thanks for the rant Rctx, it's an interesting inside look at the trades.
Link Posted: 10/1/2014 7:42:42 PM EST
Hell, I recently paid an electrician $125 to rewire an outlet. Our whole master bed/bath circuit all of a sudden didn't work. I did everything I know how to do, breaker panel, checking outlets, etc.

Turns out the guy who wired the house wired that circuit (and presumably all the circuits in the house) like christmas tree lights; if one element goes down the whole circuit goes down. None of the wiring is "tied together" in the outlets. Electrician pulled the first outlet in the bedroom, saw the loose wire, reconnected it the way it should be, and hit me for $125.

Now, don't get me wrong, I hated paying that $125 for a simple fix, but I'm no electrician.

As for you, you need to build that downtime into your price. In my business, I may spend up to several days looking at a job, pricing it, writing the proposal, etc, and all that downtime is built into my rate.
Link Posted: 10/1/2014 7:43:57 PM EST
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Originally Posted By Rctx:


So sure, you got a free estimate, but because all of those estimates we have to give “for free”, we have to raise our prices. That’s why service work is charged at $100/hr, because half of the time is wasted and unbillable.

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Where in NC are you?
Link Posted: 10/1/2014 7:46:30 PM EST
You'll get more sympathy over on contractor talk.

Lots of guys on this board are not fans of contractors.
Link Posted: 10/1/2014 7:49:16 PM EST
[Last Edit: 10/1/2014 7:51:25 PM EST by itstock]
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Originally Posted By sitdwnandhngon:
You'll get more sympathy over on contractor talk.

Lots of guys on this board are not fans of contractors.
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We don't even get our own forum or fancy icon. . A protected class we are not. Not only is talking bad about contractors allowed here, but at times, it seems encouraged.
Link Posted: 10/1/2014 7:50:28 PM EST
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Originally Posted By itstock:


We don't even get our own forum or fancy icon. . A protected class we are not.
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Originally Posted By itstock:
Originally Posted By sitdwnandhngon:
You'll get more sympathy over on contractor talk.

Lots of guys on this board are not fans of contractors.


We don't even get our own forum or fancy icon. . A protected class we are not.


I've figured out most of the people on here are the types that say shit like "I will never pay a contractor anything up front" or "No such thing as an honest contractor" with regularity.
Link Posted: 10/1/2014 7:52:40 PM EST
In your line of work, doing estimates has to be figured into the cost of doing business. It's overhead. Just like your trucks, etc. Figure it into the rates. Maybe find a lower paid person to do estimates, if you trust them.

I'm in engineering. My billing rate is about 2.6x my hourly pay rate, so our overhead rate is 1.6x.

Good luck!
Link Posted: 10/1/2014 7:53:09 PM EST
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Originally Posted By Cathan91:

Any idea if commercial electrical companies have this same problem?

I plan on applying for some electrician apprenticeships by the end of the year, everyone I've talked to has warned me off residential work. I'm thinking commercial/industrial service sounds like a better way to go.
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Originally Posted By Cathan91:
Originally Posted By netra709:
Only think I can add, is get away from residential work. They all want something for next to nothing.

Any idea if commercial electrical companies have this same problem?

I plan on applying for some electrician apprenticeships by the end of the year, everyone I've talked to has warned me off residential work. I'm thinking commercial/industrial service sounds like a better way to go.

I don't care what your politics are. I don't care what you think about unions. Forget the bullshit stories that some guys will tell you.

Join the IBEW for your apprenticeship. You'll get the best training while being paid really good money.

After the apprenticeship, do whatever you want.
Link Posted: 10/1/2014 7:55:20 PM EST
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Originally Posted By FredMan:


As for you, you need to build that downtime into your price. In my business, I may spend up to several days looking at a job, pricing it, writing the proposal, etc, and all that downtime is built into my rate.
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Originally Posted By FredMan:


As for you, you need to build that downtime into your price. In my business, I may spend up to several days looking at a job, pricing it, writing the proposal, etc, and all that downtime is built into my rate.

That IS built into my price, hence me saying this:

Originally Posted By Rctx:

So sure, you got a free estimate, but because all of those estimates we have to give “for free”, we have to raise our prices. That’s why service work is charged at $100/hr, because half of the time is wasted and unbillable.




Originally Posted By Doe_Nuts:


Where in NC are you?

I'm in northern NJ.
Link Posted: 10/1/2014 7:58:00 PM EST
I laugh.
Commercial and residential electric work for 7 years...now I do service work for a national management company.
I know the whole process on bid work...yet there's always a contractor who gets stupid down the line. I've also seen people get stupid like the op.

"My kitchen outlets don't work....."
We arrive at a 5k sq ft home with the fancy cars etc...
Wife " uhhh...omg...can you take your shoes off..huh..like really..."
Me - (reset gfci) ...there you go...
And then the Wtf ...that's to fast starts...

Your damned if you do or don't. Go fast...folks bit h....go slow....folks bitch...don't get it right ...folks bitch...

Oh well

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Link Posted: 10/1/2014 7:58:44 PM EST
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Originally Posted By sitdwnandhngon:
You'll get more sympathy over on contractor talk.

Lots of guys on this board are not fans of contractors.
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Those guys at ContractorTalk already know all of this

I'm not looking for sympathy, I was mainly looking for normal people outside of the trade to try and explain why it's like this.

If just 1 person learned that when we charge $100/hr we don't actually MAKE anywhere near that, my job is done
Link Posted: 10/1/2014 8:28:55 PM EST
How are you qualifying your new customers?

I like to make it clear over the phone that I will not be the cheapest, that usually opens the diologue on what they're cost expectations are. I try to decide if they're going to be a good customer or not before I show up. Good qualifying can eleminate 75% or more of your tire kickers and save you time and money.

Link Posted: 10/1/2014 8:31:24 PM EST
How closely do you track your guys time? Accurate job costing is important for good business decisions and generally overlooked. It's possible that even at $100/hr you make nothing on the small jobs (and shouldn't even be doing them) and that your larger jobs appear to cost you more than they really do (so you overquote and lose work).

disclaimer --> not an accountant, just like helping out small businesses


Link Posted: 10/1/2014 8:34:09 PM EST
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Originally Posted By Rctx:

If just 1 person learned that when we charge $100/hr we don't actually MAKE anywhere near that, my job is done
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I imagine a lot of people think this because they work for someone else and just draw a paycheck at an hourly rate that does not show the extra healthcare, workmen's comp, building rent and utilities costs that their employer has to charge for.

For example, Suzi makes spreadsheets for her employer and she gets $25/hour to do it.

Her employer charges $100/hr to its customer for her work, which Suzy has no clue about. Her employer has to cover the costs to get someone to bring in the work for her to do, plus all of the expenses of utilities, etc.

So a technician who works for a contractor shows up to her house, and charges her $100 to spend 30 minutes replacing an outlet, and she says, Holy Crap you make too much money!

But that tech will only see $25 out of that $100 in his paycheck.
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