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View Full Version : Stick with agreed estimate or not?


Bassman
12-01-2001, 10:03 PM
Should know the answer to this but it's bugging me...
Gave an estimate to a contract annual prospect today. We agreed on price. After re-figuring time involved, came out to app. $25 more per month than agreed on price, (after going home and using the formula for time involved times 40 visits per year etc., etc.) These folks were referred by relatives that are a very lucrative account of mine. I'm a professional and should know that when a price is agreed to, thats the end of story. However, for some reason it's bothering me. Any one have second thoughts after agreeing on contract price? I think I should suck it up and do the job for the first year as I should know what the hell I'm doing when giving estimates and not re-evaluate my numbers later. My problem, not theirs. Comments please.

dj'slawnservice
12-01-2001, 10:20 PM
How bad do you need this job?
How much does an extra $25 a month mean to you ?
I really think that it's not worth haggling over......
just my thoughts

Jim Creager
12-01-2001, 10:46 PM
Heres the Question I ask myself. If I was the customer what would I want done?

On one hand an estimate is AN ESTIMATE, that is a basicaly a FAIR guess of what it will take to do the lawn. If you were $25.00 short on the actual cost would you try to raise the estimate? If yes, then you as a matter of concience should refund the overage that you have on this estimate.

I myself would rather go to a customer and say, Hey I over estimated on your estimate it is going to be 25 bucks less!

That shows your a good honest person.

If what you gave them was a BID well a bid is a bid. that is what you get plus or minus.

Jim

Randy Scott
12-01-2001, 11:08 PM
I think it depends on all the variables involved that only you are aware of. I would say to honor your price and make it up elsewhere. You have more than just them to lose perhaps. If it was a new customer that wasn't referred I would think about telling them it is more. It sounds like you don't want to screw things up with your relatives or the new client. If you didn't make it clear that you would go home and finalize a price for them, then I would say to suck it up like your thinking to.

deason
12-02-2001, 12:21 AM
It was an ESTIMATE, wasnt it?:confused:
Or was it one of these - "Okay, Ill do it for this amount. Thank you and see you soon!":D

If it was an estimate, make your adjustments and be honest and explain to the customer why you did.
If it wasnt an estimate, lay in the bed you have made and kick your self in the butt for the rest of the year. There would be nothing worse that going back on your word. Especially on a customer that you were refered to.

Always honor your comitments.

Runner
12-02-2001, 02:18 AM
Do NOT change a thing. All that looks like, is that you are trying to squeeze a liitle more out of someone because you know they accepted your first price. We're no talking an unGODly amount, here. They would be questioning your integrity right off the bat. Not a good foot to start off on - especially with them being associated (let alone related) to one of your better accounts. Randy hit it right on the head. Make it up elsewhere. Just sell some extras. And with already established customers, this is all too easy to do. And DON'T cut corners to try to make it up!:mad: Keep your word, your name, your reputation, and your integrity. IT'LL come back to you!;)

joshua
12-02-2001, 02:36 AM
stick to your word, enough said. you will do you better even if you know that you should be making more on that account. and add in what the rest of the guys said about your reputation.

65hoss
12-02-2001, 04:31 AM
Deal with it. Your error not theirs. Its agreed upon now. Actually in a court of law you made a price, they agreed, end of story. In real life, keep your word, if not the word will get around about you. It never fails. Maybe you can use this as an advantage down the road. But for the current situation stick to your agreement.

David Haggerty
12-02-2001, 05:53 AM
Calm down.

You're just second guessing yourself. Don't loose this account over a little nervousness.

Gather more facts. Mow the lawn for the agreed upon price for a few times. A short cut on mowing technique may found, or at least the actual cost of doing the job will be apparent. But more important, it will be apparent to them

Then you can go to them and explain "hey I made a mistake on the estimate, I tried to mow it for that price and it's too low."

They'll be more likely to go along with the price increase if you're already on the job.

Dave

Green Care
12-02-2001, 08:23 AM
WE agreed on price.

I would stick with the price , get it back in another area.

awm
12-02-2001, 08:35 AM
the formula is something used to figure cost and profit figures.
to mis by 25 per month doesnt seem to critical to me.
u may find ways to cut cost . if not and your profit
on this job is affected to much ,then go to the customer an explain. whether they accept or not , do the work for the agreed on, time period.of course i know, u know that u should figure an refigure these things ,before ,not after u give estimate.
sorry to be preachy. i also agree that if this was in fact an estimate
u have some room for adjustment.just pt of all buisiness.
if say building contractors were held to absolute first bid figures,
with no adjustment provisions most jobs would lose money.
dont mean to get into builders expertise here so alow me error
please. just mho later now

HOMER
12-02-2001, 08:56 AM
I usually find that my formula and my actual time are off a little. I try to make sure it's off in my favor. If you presented a contract then honor it and make it up elsewhere. You could get a referall out of these people that could more than make up the difference or you could get a bad referral and miss an opportunity.

Stick to it.

65hoss
12-02-2001, 10:25 AM
Good word of mouth is told to a few people, bad word of mouth is told to as many as possible. Not fair but true.

Bassman
12-02-2001, 10:37 AM
Every reply has valid points and sound advice. I have worked hard to build up a sterling reputation and will not go back on my word. I may find after servicing the property a few times that I was pretty much where I needed to be price wise after all. One lesson I will take to heart is if an error is made it should be a little for me and not against me. I can always back off a little and end up alright.
Thanks.

odin
12-02-2001, 11:09 AM
To me my word and honor would be worth more than the 25$
Keep your word and if they are still with you next season then go up
I have underbid on a few and sometimes lost bigtime. so i agree with bassman a sterling reputation is worth more

Buttered Waffle
12-02-2001, 12:27 PM
My calculator reads 25x40=$1000. That isn't exactly chump change. As far as a sterling reputation is concerned, I wouldn't want to be known as the guy that works for less than he is worth. An estimate is an estimate is an estimate. the contract is what matters. Since they are from a great referal, it seems to me that they want your services. If they think like you do that it is only 25 bucks per month, then you have the upper hand on getting the $1000 per year. Think big!

Randy Scott
12-02-2001, 12:32 PM
$25 per month, he's from Florida, I'm assuming grass is cut all year, not sure, 12x25=300. Last time I checked there are 12 months in a year. So $300 could be made up elsewhere and shouldn't be too large of a price hike the following season if client is happy and you do a little explaining about the good deal they received the previous season. Florida sounds like a pretty tough market so in the realm of things $300 is chump change.

Buttered Waffle
12-02-2001, 12:50 PM
Yeah I goofed. Sorry for the condescending attitude. But three hundred dollars is a new trimmer,or two weeks worth of groceries,or a plane ticket to almost anywhere in the continental U.S. Get the idea? Chump change is any money you could have made, but decided not to. IMHO.

bruces
12-02-2001, 01:11 PM
Live with it. The customer probably thinks you quoted a price.

If I were in his place, I would probably tell you to take a hike if you give me one price and then call back after you get back to the office and say "oh, by the way, my estimate was off, it will be $25 per month more". I would be inclined to think this is the way you do business and want nothing to do with you.

I'm sure that is not the case, but I would eat the $25. After all, you say "we agreed on a price."

Sounds like you need to make up some kind of worksheet or something so that you can work your formula on the spot before giving the customer the quote. That might prevent this from happening again.

How much is the total amount we're talking about that you bid?

Would you rather have that amount or nothing?

If you are making money at the original figure, stick with it.

bubble boy
12-02-2001, 02:21 PM
i dont think anyone has yet asked his price per month. if its $200 per month, why sweat it? if its $50 per month, and you should have charged $75 you have a difficult situation. its easy to say suck it up, cause i wont be doing the work.

how is your relationship with the original customer? factor that in. some people are understanding.

awm
12-02-2001, 02:28 PM
a good thing to remember 65.sadly it is the truth, later now

bobbygedd
12-04-2001, 01:24 PM
i brought my car in for work, estimated at $300, final cost, $387. had a roof put on, est. $3200, final price, $3375. my opinion is: it happens all the time, if doing the job at your original estimate is a real problem, then tell them u need to re-estimate based on ..... if its really not a problem, just do it at original price. to me there is nothing worse than screwing up an estimate and still doing the work. yes, word of mouth travels fast, how does it sound when someone else calls for a price and u get it right this time and they say well my friend so and so said u did hers for less. now what? do everyone for less or be accused of profiling, favoritism, and cheating? i know i got a lot of customers upset while learning and growing, and guess what, every year hundreds more call me. do whats right 4 u. now go ahead guys, bash me