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View Full Version : HO wants to furnish all materials???


Meezer
09-27-2008, 11:49 PM
Anyone have any good luck with a HO furnishing all materials??? I have a potential client in an upscale subdivision that sprung that on me as my interview of them was ending. I told them that I'd get back them & went to my next appt. several houses down the street.

P.Services
09-27-2008, 11:53 PM
god i hate people like that. what is their reason. oh wait i allready know.... because they think you buy it from the same place and mark it up to much they think they will save $. f them.

Meezer
09-28-2008, 12:08 AM
god i hate people like that. what is their reason. oh wait i allready know.... because they think you buy it from the same place and mark it up to much they think they will save $. f them.

What I was able to find out was that they did get several "outrageous" (their word, not mine) quotes from several landscaping companies recommended by the nursery supply place where they would be buying the wall units from.

They think they would be saving money by purchasing all the materials, yet they don't know what they all need. They want me to provide them with a materials list!:laugh::laugh::laugh:

Mike33
09-28-2008, 12:17 AM
Elements of business, deal with it. I had that happen 2 monts ago h/o bought all of his block, and they was the same as i used. I loved it wall was 800 block, so i made him buy all of the stone and pay for the trucking of excavtion material away. I priced it $$ per block and $$ for excavation, i couldn't loose. I mean i didnt under bid block, under bid stone, i made out. Sometimes it works out but always be ready to make a dollar if situation looks tough.
mike

cudaclan
09-28-2008, 09:28 AM
Iíll remember that the next time I go out for breakfast. Iíll take my own eggs and bacon and have the local pancake-house cook them up for me.

LB1234
09-28-2008, 10:24 AM
I usually get around that in two ways.

(1) I'm upfront with my customers and explain the cost of materials is 10% over MY cost...which is usually cheaper than they can get it anyway. Most see the light within seconds...those that don't:

(2) I explain if they get the materials it's up to them to calculate how much materials they need and its up to them to coordinate delivery times. I then explain that if me and my guys are sitting around waiting for materials that we go to an hourly rate. I then also explain that the same thing occurs if we run short on materials that we will be paid until the material gets there. I also explain that I can help them calculate materials needed and help coordinate delivery times, jopsite placement of the materials, etc. but I will charge an hourly consulting fee.

Meezer
09-28-2008, 10:37 AM
Elements of business, deal with it. Sometimes it works out but always be ready to make a dollar if situation looks tough.
mike

I always go with my gut instinct & in this case it tells me to pass on this one. They're expecting a free design & materials list from me.:laugh::laugh: Nfw. :nono::nono:

Meezer
09-28-2008, 10:47 AM
I usually get around that in two ways.

(1) I'm upfront with my customers and explain the cost of materials is 10% over MY cost...which is usually cheaper than they can get it anyway. Most see the light within seconds...those that don't:

(2) I explain if they get the materials it's up to them to calculate how much materials they need and its up to them to coordinate delivery times. I then explain that if me and my guys are sitting around waiting for materials that we go to an hourly rate. I then also explain that the same thing occurs if we run short on materials that we will be paid until the material gets there. I also explain that I can help them calculate materials needed and help coordinate delivery times, jopsite placement of the materials, etc. but I will charge an hourly consulting fee.

I like that. :clapping:

Frontier-Lawn
09-28-2008, 11:14 AM
i teach all clients of mine a good lesson if they pull this on me.

i tell them go buy a $100 palm from HD and i 'll get a $100 palm from my supplier.

i bring my palm over to there's and mines 10' there's is 5'. that solves the prob right then, and they let me handle all materials then.

Hardscaping
09-28-2008, 01:03 PM
As long as they buy the materials and have the correct amount of materials whats the difference. Just charge them more to install thats all, figure out what the job would cost you if you supplied the materials, minus YOUR cost of materials and then charge them that including the mark up on materials as well. this way they will end up paying more, if they ask why you tell them, that your mark up on materials is factored into the cost of building the wall or walkway, and to do the job you need that much.

Hardscaping
09-28-2008, 01:06 PM
I always go with my gut instinct & in this case it tells me to pass on this one. They're expecting a free design & materials list from me.:laugh::laugh: Nfw. :nono::nono:


To solve this issue tell them in order for you to tell them the amount of materials needed, you need a deposit on the job or some kind of good will that you will be doing the job like a signed contract. in the contract state that if they don't get you to do the job after telling them the amount of materials, that they have to pay $xxx.xx for the time you spent calculating the amount of materials.

stuvecorp
09-28-2008, 01:25 PM
Anyone have any good luck with a HO furnishing all materials??? I have a potential client in an upscale subdivision that sprung that on me as my interview of them was ending. I told them that I'd get back them & went to my next appt. several houses down the street.

I had that happen on two projects, the driveway last year and some window wells. It is nice because they have to do all the legwork, I gave them the material list and if they screw up it's their problem. I do make it clear that they have to get the product I want and I do figure alittle strong. On the window well project we had there was three pallets of block left over, they wanted me to take it back but told them they wold have to pay me and they didn't want to. How many trips do you think it took to haul three pallets of Versa-Lok back in an old station wagon? They also didn't realize about the pallet deposit.

PatriotLandscape
09-28-2008, 02:10 PM
As long as they buy the materials and have the correct amount of materials whats the difference. Just charge them more to install thats all, figure out what the job would cost you if you supplied the materials, minus YOUR cost of materials and then charge them that including the mark up on materials as well. this way they will end up paying more, if they ask why you tell them, that your mark up on materials is factored into the cost of building the wall or walkway, and to do the job you need that much.

You don't do it because it is not good business. I like the example of bringing your own eggs to the restaraunt.

why don't they rent all the equipment as well. If they are that interested then they also should hire some employees and manage the project themselves.

Simply tell them that it is not in their best interest to purchase the materials. get the bids and compare them thats it.

Ask them why they called you in the first place.

mrusk
09-28-2008, 02:52 PM
If they insist on buying materials let them. Just inform them of what will happen if they do not have what you need when you need it.


Successful business do not mark up materials. It is impossible to budget your company properly if you depend on material markups to cover your overhead.

LB1234
09-28-2008, 03:18 PM
Successful business do not mark up materials. It is impossible to budget your company properly if you depend on material markups to cover your overhead.

Completely DISAGREE with the first sentence. Seems you are painting with an awfully large brush there.


I do however agree with your second sentence.

DVS Hardscaper
09-28-2008, 06:49 PM
It boils down to communication.

We have done some VERY lucrative jobs where the H/O has supplied the materials.

Infact, last week we did a job where the H/O supplied that materials.

We are in the business of selling LABOR. As long as we're turning production hrs and getting paid for those hours, I don't care who supplies the blasted materials!

Regarding communication: if the h/o supplies the materials and you run short and need more, the way I handle this is I have a clause in the contract stating that they will have to pay for our time to go get additional materials.

Many of us are self employed because we're CONTROL FREAKS. Forget about controlling everything, do as the client wants and charge accordingly. Whats the worse that can happen - They refer you to friends who want $45,000 of work??

DVS Hardscaper
09-28-2008, 07:21 PM
BY the way -

We do NOT mark up our hardscape materials. Nor, have we done so since 2000.

Mr. Rusk is 100% correct.

You need to rely on selling production hrs. Not selling material. I could write on this subject for 2 hrs, covering all the bases. However, I have a design and estimate I NEED to have finished TONIGHT :)


www.outdoorfinishes.com





.

Malibu landscape
09-28-2008, 08:07 PM
Double the labor charge in that case,
You have to make your profit somewhere.
Owner takes it out of the materials and then where is it coming from
Labor alone?
I know I can't stay in business that way only

PlatinumLandCon
09-28-2008, 08:30 PM
Double the labor charge in that case,
You have to make your profit somewhere.

You don't profit on your normal labor charge???:hammerhead:

Malibu landscape
09-28-2008, 08:59 PM
You don't profit on your normal labor charge???:hammerhead:

I profit on both my labor and materials charges . why would I want to sacrifice either one of them and make less money? :hammerhead:

howierd3866
09-28-2008, 09:12 PM
there maybe to few diff sides to this ....but if the contractor provides the material and the labor there should not be a problem if the material dies it would be up to the contractor because he provide it and install it and not the customer. But I like the ideal the customer buys the material no money out of my pocket...but then yes if they dont get enought then there should be a cause in there for that. As for profit you better be making a profit off the labor....also if I buy material for a job YES there will be a % add in there...like handling fee---phone calls---my discount---paying for the material--and so on and so on...If you sell yourself right than the customer will see MOST of the time it better just to let the contractor handle everything...

PlatinumLandCon
09-28-2008, 09:19 PM
I profit on both my labor and materials charges . why would I want to sacrifice either one of them and make less money? :hammerhead:

Oh, well i don't mark up materials for profit, just to cover 100% of materials related costs (delivery, fuel, blah, blah)

Meezer
09-28-2008, 09:26 PM
BY the way -


You need to rely on selling production hrs. Not selling material. I could write on this subject for 2 hrs, covering all the bases. However, I have a design and estimate I NEED to have finished TONIGHT :)


www.outdoorfinishes.com





.



It's not only selling production, hrs., but also selling my design services & my consulting services all of which are NOT free. In addition, I do get volume discounts from my various suppliers of hardscaping and masonry materials so yes, I also sell materials.

mrusk
09-28-2008, 09:40 PM
If you need to charge a markup on materials you are not charging enough for labor.

Ofcourse you should charge for your time to acquire the materials.

How can you figure the right % to mark up your material to meet your overhead if at the begining of the year you have no idea how much material you will purchase? How do you know if you will do a ton of marble jobs or basic paver jobs?


If you depend on markup to run your business you are taking a gamble and do not know your numbers.

Malibu landscape
09-28-2008, 09:46 PM
If you need to charge a markup on materials you are not charging enough for labor.

Ofcourse you should charge for your time to acquire the materials.

How can you figure the right % to mark up your material to meet your overhead if at the begining of the year you have no idea how much material you will purchase? How do you know if you will do a ton of marble jobs or basic paver jobs?


If you depend on markup to run your business you are taking a gamble and do not know your numbers.

It's no wonder so many landscapers and masons are broke and going out of business .

What other service business does not markup materials ? Plumbers, electricians, appliance repairs. They all make $ off labor and materials.

Mike33
09-28-2008, 09:52 PM
I agreewith DVS and Mrusk. I do not mark up materials either. I don't get that much of % off material any way. If H/o goes to supplier to look at material which is smart to do and see's you was charging $12.00 for a $8.00 block you look pretty stupid. The same with top soil i pay $300.00 for tri-axle delivered and i tell customer that. If he looks at name on truck and calls for more later and finds out you charged add. for load they dont like that. I do agree with the statement dont bring your eggs to rest. but i'm not in the retail sales business either. 99.1% of time i supply the materail and i can loose if i didnt allow for enough stone, block. caps, etc. But i mentioned earlier the job i did this summer where h/o paid for his block which was the same brand i used any way, had an account with quarry. paid for grid. My deal was x amount of dollars for excavtion, x amount for each block and cap, i could not go wrong it was win win money in my pocket i would do this every day if it was the same situation. It was a large wall i could of under estimated say 40 block and 20 ton of stone real easy and costed me money, instead i made out.
Mike

mrusk
09-28-2008, 09:53 PM
It's no wonder so many landscapers and masons are broke and going out of business .

What other service business does not markup materials ? Plumbers, electricians, appliance repairs. They all make $ off labor and materials.

How do you determine what your hourly rate or labor charge is?

shovelracer
09-28-2008, 10:05 PM
What I was able to find out was that they did get several "outrageous" (their word, not mine) quotes from several landscaping companies recommended by the nursery supply place where they would be buying the wall units from.

They think they would be saving money by purchasing all the materials, yet they don't know what they all need. They want me to provide them with a materials list!:laugh::laugh::laugh:

Read: Mr. Meezer, my wife and I have gotten several outrageous quotes. Ive seen several articles in my wifes magazines that show complete walkways for under $1500, and I've read the Readers Digest Do-It Yourself Manual, and feel I am capable of doing the job. However, my time spent doing this would rather be spent golfing and spelunking with my wife. So if you can give me a "reasonable" hourly rate ($10). Then you can have the job. Otherwise, I will just do it myself. Your ad also said free estimates, so if you could give me a detailed material list and installation procedures estimate that would be great. Unless you are falsely advertising then I will tell everyone I run into how unreasonable you are. So please get this to me by tomorrow so I can review it with my wife.

DVS Hardscaper
09-28-2008, 10:08 PM
Allow me to begin with saying that YES, I know there are some stingy people out there who do want work done for as cheap as possible :) Any no, we don't want anything to do with them.

However, your design services and your consultation are totally seperate from the installation services. Your consultation should be paid for at the time of the initial meeting. And your design services should be paid for in full upon presentation of the final design. And really, consultation fees are not about re-couping money for your time, consultation fees are used more as a qualifier as to how serious they are about doing the work. If they're serious, they won't mind paying consult fees. If they're kicking tires and lookin for free advice and a free design - they'll bulk at paying for a consultation.

All that is totally seperate from the install work.

In terms of making money, it all boils down to that annual budget. And I know every single person here has a budget!!! We can debate all we want, but really - all contractors are in the business of selling labor. Most established companies annual operating budgets are based on production hrs. Yes, we sell materials. But we make our money off of labor.

We can install a 1200 SF pool deck. Our indirect expenses are dependant on the production hrs it will take to do the job. Will the client go with the most expensive paver that is $5 / sf or will they go with the least expensive that is $2.86 / sf?? We can install either paver in the same amount of time. It doesn't matter to me which paver they choose.

8 years ago we did a job for a wealthy client. We are in western MD. The client has a weekend home 2.5 hrs away in Eastern MD. We installed 3200 SF of pavers around his pool at his 100 acre weekend home. He supplied ALL the materials. I think the job took 7 days to do. I charged him $15,000.00, which also included motel expenses. Thats $2,000.00 / day, billed for labor....8 years ago! Who cares if we didnt supply the materials! I don't care if every job we ever do is a job where the client supplies that materials! As long as we get paid for our time and equipment, make a profit, and the check doesn't bounce.....I'm happy.

You really have to be able to know how to work numbers. When you know your numbers, you CAN make anything happen. You need to keep an open mind. I always think of each and every prospective job as a job that will land us REFERRALS. If myself and a prospective client see eye to eye I'm not going to loose the chances of scoring prospective work from their friends over who supplies the goods. Make the numbers work for you.

DVS Hardscaper
09-28-2008, 10:15 PM
It's no wonder so many landscapers and masons are broke and going out of business .

What other service business does not markup materials ? Plumbers, electricians, appliance repairs. They all make $ off labor and materials.


I can tell you never attended any seminars with Charles Vanderkoi!

CAG
09-28-2008, 10:40 PM
i think for the most part its a bad idea.. some have the right idea by making the customer aware of charges for holding you up on the job but when the bill comes im sure none of them pay it with a smile on their face. and i would think it adds more stress on the business schedule.. i would love to get paid to hang around on a job for a couple of hours with the guys and get paid for it but we are always running fully booked schedules and would rather not waste time.. i keep all landscape materials at my shop for this reason except wall block and pavers( i do a lot more general landscaping).. what do neighbors say when you run short on caps and the customer says ill get the last two and put them on myself when i have time or you leave the stone he over ordered in the yard because he just paid for it and now does not want to pay to remove it.. i think it just opens up a whole can of worms.. for the record i always mark up materials but just a little and figured a little heavy also.. i just do it for a little extra ins on the jobs not to make a big profit..

stuvecorp
09-28-2008, 10:41 PM
I can tell you never attended any seminars with Charles Vanderkoi!

I still remember him, '...Flame Red Dodge Dually... and "The Check In The NIght'

He had a lot of good points, enjoyed his semiar.

Meezer
09-28-2008, 10:44 PM
Read: Mr. Meezer, my wife and I have gotten several outrageous quotes. Ive seen several articles in my wifes magazines that show complete walkways for under $1500, and I've read the Readers Digest Do-It Yourself Manual, and feel I am capable of doing the job. However, my time spent doing this would rather be spent golfing and spelunking with my wife. So if you can give me a "reasonable" hourly rate ($10). Then you can have the job. Otherwise, I will just do it myself. Your ad also said free estimates, so if you could give me a detailed material list and installation procedures estimate that would be great. Unless you are falsely advertising then I will tell everyone I run into how unreasonable you are. So please get this to me by tomorrow so I can review it with my wife.



You're right on except you missed one thing shovelracer:

HO placed the following ad on Craigs List:

http://chicago.craigslist.org/nwi/lbg/855910638.html

LB1234
09-29-2008, 07:57 AM
since I'm waiting for the ground to dry out a little more....


DVS and Mrusk are making some excellent points.

Specifically, if you are utilizing materials markup to cover overhead/labor costs. Simply put, well, that's stupid. My markup for hardscape materials is 10% over my cost. It's really just pure profit. Do I need to do it? No. Do I? Yes.

I just don't agree with the statement made about "sucessful companies do not markup materials". I think there are plenty of successful companies that do it. Now, if you are a company marking up materials to stay successful, then yes, I think you are heading down the wrong path.

Perhaps on this one some of us will have to agree to disagree.

howierd3866
09-29-2008, 09:45 AM
Thanks I got a new ideal...We spend about 25K every year on New tires and repair from now I'm going to tell them I'd only paying cost and just what labor cost..I'm always learning something new on here..thanks again

shovelracer
09-29-2008, 08:51 PM
You're right on except you missed one thing shovelracer:

HO placed the following ad on Craigs List:

http://chicago.craigslist.org/nwi/lbg/855910638.html

Thats even better. So he wants to pay $1000. How long would it take to extend the patio floor mixing 80lb bags of quikcrete? Maybe $5 / HR is closer.

For the record Im not opposed to a HO buying materials under certain circumstances, but this sounds messy. I also do mark up materials and charge delivery to make up for the cost of gathering supplies, and time spent organizing the job. I know how many hours a year I can provide labor, but if one year I spent 200 hours extra gathering materials than expected and didnt mark up materials than my labor rates would have to go up. To put it simply I know what I will make in a year before it happens. I can fill every hour with labor, or spend 50% of the year shopping for supplies. In the end I make the same as long as I work (Labor or shopping) everyday I expect to. Percentages are also included for downtime, weather, etc.

Isobel
09-29-2008, 09:24 PM
I now make it a rule to always buy my own material, mainly so that I can keep a handle on the quality of the materials going in.

Last month I had a guy who wanted a quote for installing a bluestone patio. I gave him a quote for labor as well as the stone--if we bought it. Then he wanted just a quote for the labor if he bought the stone. I gave it to him with the understanding that he was getting bluestone for a patio, not a wall, and that it was rectangular.
When the stone arrived, I walked out with the client and showed him why he got the stone so cheap, each piece was a different thickness. In the end his total labor cost him more as the first estimate. Since all the pieces were different thicknesses we had to spend more time on it.--aand it was a major pain in the ass.

with hardscapes I always insist on buying the materials, otherwise there is no contract.
with landscapes its a little bit different.

PatriotLandscape
10-01-2008, 07:18 AM
Double the labor charge in that case,
You have to make your profit somewhere.
Owner takes it out of the materials and then where is it coming from
Labor alone?
I know I can't stay in business that way only

you need to see Mr. Vander Kooi stat!

PatriotLandscape
10-01-2008, 07:20 AM
It's not only selling production, hrs., but also selling my design services & my consulting services all of which are NOT free. In addition, I do get volume discounts from my various suppliers of hardscaping and masonry materials so yes, I also sell materials.

the savings on materials is marginal and markup should be around 10%. we charge 9% this is really to recover overhead.

Your profit is not overhead and it seems most people do not understand the cost of doing business.

PatriotLandscape
10-01-2008, 07:59 AM
I still remember him, '...Flame Red Dodge Dually... and "The Check In The NIght'

He had a lot of good points, enjoyed his semiar.

I think it was

"The bill in the night"

It was most likely the biggest change I will ever make in business when we switched to his method. We are making more money now because of it and that is solely based on we are charging the correct amount on jobs.

DVS Hardscaper
10-02-2008, 03:01 PM
Belgard in Maryland used to put on his (Charles Vander-Kooi) seminars every winter, every year. They haven't done them in the last recent years. But they are sayin they're hoping to have him back this winter. He really knows his audience, and if you don't leave there with new knowledge - then just keep on a'mowin grass!

Mike33
10-02-2008, 09:24 PM
Let me know, i would be interested. Btw i was down your way tuesday had to move my kid back from Ocean City.
Mike

dougaustreim
10-04-2008, 08:44 PM
Charles Vander Koi marks up everything, just not at the same percentage. We do not do jobs with customer supplied materials just as we do not let the customer help. For one thing our volume discounts allow us to buy material at significantly lower cost than our customers could.