Low Ball, low balling.

[Jon 533]

The below is a quote from a post by Alan that truly needs to be given some serious discussions.

And the word Low balling is used so often and out of context, that we need to come up with a new word.

You guys and gals need to be at the forefront of this teminology "low baller" and get a word or way of describing someone that cuts prices or bids so low there might be very little profit in it.

Words like:

Cheaper sales

price cutter

low baller

uninsured/unlicensed

fly by night

week-end warrior

part timer

Those are just a few words that truthfully don't work, to improve the industry as a whole I encourge all of you to brainstorm on a way to describe what all of us at one time or another have dealt with, someone or some company cutting our prices so low we cannot compete against them.

Ok folks start your brains and remember when you list a word or sentence explain the reason you feel it should become the new industry standard to describe those people.

[Washaway 64]

LOL!!!!!!!!!!!!!!

I want to send out a direct mail piece with that and title it,

"A message from a Power Washing Competitor."

I'm saving this one and once the website is done it will be posted!!

LOVE IT!

[timbertramp 14]

Thanks. Just wondering. I have never experenced someone posting below my bid. Was asked by a customer to lower my bid to meet another but stuck with my bid. Didn't get the job but oh well. Thanks for the feedback. Kem

[StainlessDeal 16]

MISFITS, was that not the name of a movie Mailyn Monroe was in?

The Misfits was Danzig's first band as a kid. (Gotta love the Metallica tribute recordings on Garage Days):bandplay:

:topic: Sorry

[Washaway 64]

.... I have never experenced someone posting below my bid. Was asked by a customer to lower my bid to meet another but stuck with my bid. Didn't get the job but oh well....

Just yesterday, while on a commercial jobsite, I was asked to quote on a two story roof to which my response was $230. The owner almost fell off his feet and then proceeded to tell me that the guy last year did it for $125. Told him that if he was happy with the work he should call him back let him climb to heights like that for that kind of money. Also, I asked him to look at the pool house roof (which I cleaned 14months) and is just now starting to show very very slight traces of algea.

.........the funny thing about this is that I remember seeing a dude on that roof last year and the day after he finished I knew it wouldn't last more than 6 months.

Don't be suprised....they're out there. Everywhere!!

[RyanH 14]

Thanks. Just wondering. I have never experenced someone posting below my bid. Was asked by a customer to lower my bid to meet another but stuck with my bid. Didn't get the job but oh well. Thanks for the feedback. Kem

It's really strange when a customer asks you to lower your bid to match a competitors. It tells me that they aren't buying based upon price alone but that they recognize your abilities (either through the way you presented yourself, your knowledge, etc.) as being of some value. It's a shame that their brain recognizes that type of value but their wallets (or spouse??) won't allow them to act upon it. Perhaps you can work that into the callbacks when they ask you to lower your price to match:

C: "I got a bid from one of your competitors and it's lower than yours. Do you think you could match his price?"

You: "The fact that you didn't go with him immediately tells me that you instinctively believe that there is more to what you consider "value" than simply a cost. My guess is that you recognized that he wasn't entirely committed to quality and lacked the experience I have and would not perform as well. Either that or you believe that there is great price flexibility in this industry. I can assure you that my prices are based upon a real business model and are not whimsical...I won't make money if I do it for lower than my original bid."

C: .....I don't know, I can't predict what the average customer will say here. Usually the ones I had would laugh and say "Okay, come on out."

[Beth n Rod 1,279]

A Message From The Low Baller :lgwave:

Dear Cherished Customer,

Thank you for hiring us. We look forward to saving you a lot of money compared with all the other contractors who submitted quotes. As for your inquiry as to how we can charge so much less than everyone else, I welcome this opportunity to explain how we operate.

You see, unlike many of our competitors, we don't believe in paying top dollar to employees. There are so many people looking for work these days, it's pretty easy to find some desperate enough to work for far less than they're worth. If they start complaining, we just get rid of them and find replacements in a few days. Most jobs get disrupted just a little bit.

Besides, we don't look to hire the best workers. Most of the work required for your project can be performed by people with almost no skills. (In fact, if you care to do some of it yourself, I can save you even more money.) Heck, I've learned that some of the best employees don't even speak English. They work cheapest of all and never sass the boss. Most of the time they can figure out my hand signals telling them what to do. If anything complicated does arise, that's what I'm here for. It may take a few days for me to get around to check out your job, but with all the money you're saving, I'm sure you won't mind the wait.

Not only don't we pay our employees very much, we offer no benefits, because that adds way too much overhead. Our employees know that if they get sick and can't work, they don't make any money. So you can rest assured that they'll show up at your job even if they come down with pneumonia or TB.

I'll tell you something else, our installers and technicians work fast. A lot of contractors tell their crews to hang around jobs forever making sure everything is just right. Experienced as I am, I know exactly when something is just good enough to get by. That’s when we call it a job. Think of all the money you save with us, not worrying about all the frilly details.

Another thing is we know how to cut through all the government paperwork. Most rules and regulations make no sense. For instance, everyone in the construction industry knows that hardly anyone ever gets caught working without a permit or trade licenses. The money we save by avoiding these technicalities gets passed on to you. We also cut corners with code requirements and standards at every opportunity. Standards do nothing but jack up the price of a project. By substituting cheaper materials and ignoring labor- intensive procedures required to meet code, we are able to charge much less than those suckers who operate by the book.

Insurance is another area where we realize big savings. How many jobs do you ever hear of where there’s a payoff? Insurance is nothing but money down the drain. If something does go wrong, you can always sue us. What more protection do you need than that?

I’ll let you in on another inside secret. We cleverly save you money by not paying all of our bills. Our company has accounts at about a dozen supply houses around town, and we never pay for material unless we absolutely have to. Most wholesalers will carry us for sixty or ninety days before they start nagging me about payment. Then I can usually string them along for another few months with promises or token payments. If one supplier cuts us off, I simply take my business to the others and go through the same routine. It’s a game that real sharp contractors like myself have refined to an art form. You ought to be proud to have you job done by an artist?

Something else that separates us from the pack is that we’re not a bunch of namby- pambies hung up on safely concerns. Accidents will happen so why bother trying to prevent them? Some contractors worry more about their trades people getting hurt than they do about getting the job done fast. Believe me--hard hats, eye shields, and work gloves only slow people down. So we don’t supply those things to our workers. Here’s where we gain another advantage by hiring a bunch of people who don’t speak English. They can’t read warning signs that might make them too cautious. This saves you money.

Also, I’m sure you noticed that when you called me, you reached an answering machine, not some secretary costing over $10,000 a year. Sorry that it took me so long to get back to you, but that’s the price you pay for saving money. You may have also noticed that our trucks are run-down, our tools worn out, and this letter is being written on a 1950’s vintage manual typewriter. Our philosophy is to make do with whatever is already paid for, no matter how old. That’s another reason we can charge you so much less.

Nor do we waste money on association dues and educational seminars like some of our high-fluting competitors. Believe me, I’ve been in this business for more than 20 years and I learned everything anyone needs to know in my first two years of apprenticeship. If it was good enough for my daddy and granddaddy, it’s good enough for you.

By the way, did I mention that we guarantee our work? Just make sure you catch what’s wrong before the job is done, because at the prices we charge, we can’t afford any callbacks. Thank you once again for letting us do your work. We are happy to be the low bidder. I’m sure you’ll get your money’s worth.

Sincerely,

The Low Baller :)

Sarcasm...you gotta luv it but fer real, that thar is perty darn tuttin scarry !

Git er done!

Perceptions are funny but the reality is quite strange and I have to wonder how many idiots for customers would actually buy that! lol

It is understood that many start ups have costs that are significantly lower than those how are more established and have built up expenses in advertising, insurances, lease or purchases for better equipment/vehicle(s), office staff, etc.

These can often be misconstrued to be low-ballers rather than just a newer business. We have seen these appear on the horizon and soon show themselves to mark up in order to make a better margin and not leave money on the table.

But the letter Jesse wrote is the epitome of the third classification of contractors we are up against.

Classifications defined:

The 1st classification being the new start ups.

The 2nd classification being the established business'.

The 3rd classification being the ones who defy all the rules of the game in proper business management and customer service and contribute to the stigma of contractors as a whole.

I am not saying that any one of these classifications is better than any of the rest, they are here for the purpose of making a distinction.

Rod~

[Steve Kiser 14]

C: .....I don't know, I can't predict what the average customer will say here. Usually the ones I had would laugh and say "Okay, come on out."

LMAO, no offense but that is too funny.

[Jon 533]

Pressure Pro, age is only a number & does not make the person. Besides I just happen to be a Mature Adult!

Kem what Pressure Pro said in his last post stands well.

Here is how I used to do bids, or for major stores and businesses more then the one time little guy.

When I typed my bid and was ready to hand it over it included a copy of my business license and certificate of insurance.

One way to instill in customers they are getting a good business deal is ask them if the other lower bid can show you a copy of his business license and proof of insurance on the spot. The law requires you have that with you if your mobil.

Go into any business, be it McD or Red Robin and they by law have to have that info posted and you are allowed to ask to see it.

Very few if any MISFITS will have either, sure some are legal and just like to cut prices so they can claim they are bigger then you but the quality of work is not equal and it will show up fast.

Another thing you can do is offer a free demo, either a small area or a whole job.

Offer a free job if they give you x number of month on contract with a none-cancel agreement or they pay.

[Washaway 64]

Just yesterday, while on a commercial jobsite, I was asked to quote on a two story roof to which my response was $230. The owner almost fell off his feet and then proceeded to tell me that the guy last year did it for $125. Told him that if he was happy with the work he should call him back let him climb to heights like that for that kind of money. Also, I asked him to look at the pool house roof (which I cleaned 14months) and is just now starting to show very very slight traces of algea.

.........the funny thing about this is that I remember seeing a dude on that roof last year and the day after he finished I knew it wouldn't last more than 6 months.

Don't be suprised....they're out there. Everywhere!!

He stopped me today and approved the work. It feels good when you stick to your guns and you're sales approach works!!

[timbertramp 14]

Jon, good points, thanks for the info. Am trying to get some regular accounts and the info will help. thanks alot. Kem