As a contractor I have been asked to break out my project proposal numbers countless times. When I first started my business it was something that would make me uncomfortable, but I would still do it because I thought I was serving the customer in doing so. In reality I wasn’t helping them and I definitely was not helping myself. Here’s why not to ask your contractor to break out their pricing.
As a homeowner
When you ask a contractor to break out their numbers is not as seemingly simple a question as you may think. Contractors spend years working on their individual pricing model and structures. It is a trial and error process that takes many failures and successes to come up with. One contractor may have significantly more overhead than another which will impact HOW they have to price projects.
A contractor and wife duo that works out of a home office is going to have much different overhead expenses than the company that has a warehouse, office staff and a fleet of company vehicles. They both may be roofers, but their prices will be dramatically different.
Asking the husband and wife to break out numbers to compare to the larger operation is not going to give you the information you think you are looking for.
Homeowner – Do this instead
You have heard this, I am sure, but you should always strive to get multiple proposals for a project. Learn and study each company you invite to give you a price. Learn their system and project delivery. Understand what type of support team they have. You should definitely know the specific materials each is using to ensure you’re not being offered a subpar product.
You will get what you pay for
If you’re looking for the lowest price, please understand that you are also going to get either the lowest quality or time delivery. Every project is a balance between quality, price and delivery. As a homeowner you get to pick the two you want. If you want it done fast and cheap, then it will most likely take a long time to get done. If you want it done well and fast, the cost will be driven up.
Do not think that you are always making the best choice of contractor simply based on price. Remember, you are not doing yourself or the contractor any favor by asking them to break out their price.
How to approach this question as a contractor
Our personal recommendation for this question is to politely decline the request and give them a straightforward reason why. Perhaps you can even send them this article as a reference. You can tell the homeowner that you have worked diligently to develop your pricing structure. Be upfront about how you’ve made mistakes in the past and you’ve learned what it actually costs you to do the work. Do an excellent job laying out the way you will approach the project, detail the scope, and give them the information about your processes. If you’ve done this, then you’ve given them all they need to make an informed decision. Broken out pricing is not what they need. Stand firm and if they don’t like it, then obviously you two don’t believe the same things. We believe people do business with people that believe they same things as them. Move on and find your like-minded homeowners.
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