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View Full Version : ok, saving costs that are not controversial...


David Gretzmier
01-20-2010, 09:29 AM
ok, the idea is to maximize the profit in a job, without sacrificing quality. many times just the thought of saving money means cutting back on quality. but many times, it means cutting back on quantity. It means cutting waste. It means making better choices and making decisions that has very little to do with what your effect looks like when your done, or the lifespan of the product you just installed. it means watching dollars on key items and sewing up the "I want it" problem that comes with every new job.

I get a 5000 buck landscape lighting job on monday, aprox 19 fixtures and have to buy materials for that job. many of you guys keep trans in inventory, probably different sizes, but I do not. one of the choices I make is when I get that 1st daw is where am I going to get that trans. many of you know I am not married to any particular manu, I have tried many that work excellent and have proven themselves in the field for years. The ones that have not, well, I don't buy them, and the ones that work as well as the others that are pricey...well, I don't buy them either. That is no secret. So I have a choice of about 4-5 different places I can buy a trans, and they are all priced pretty similar.

and here is where it get's interesting. shipping matters to me. some folks charge you shipping, some do not. many times the cost of X trans is lower, but not if you compare it fairly with Y trans, which has free of nearly free shipping. also, if you buy the wire from some folks, it will put you into a price range whee shipping can become free. it can even get complicated to the point of fixtures, where buying that may get you into free shipping.

see, here's where a lot of you guys and me diverge. I have tested probably a dozen mr-16 sealed mr-16 bullets over the years, and used 4-5 pretty regular. the idea that you guys would shop for your bullets may rock your world. but like trans, i am not married to 1 or 2 bullets. if it has worked for me, it is on the table. The light that comes out of that lens of each of those looks pretty similar to me. I will agree the convex lens bullets do seem to spread light a bit differently on narrow beam mr-16 bulbs. but 30 degrees and up looks the same on floody bulbs.

anyway, I look at the total cost and make a few judgement calls, one of which is at what point do I upgrade to a larger trans. I am curious when you guys do it. when I sign a contract with folks, I kinda know whether they are going to add on. do I build that in the trans and wire now and enjoy higher profits later? If I feel confident this is a one and done, do I go ahead and load a 600 watt trans with 480 watts and walk away? or do I bump them to 900 and pay the cost, hoping I am wrong? This decision, and how you regularly answer it, actually can affect your yearly bottom line way more than you'd like to admit. the cost to move up to the next size can be small, maybe 50-80 bucks, or maybe more get your attention 120-200 plus bucks. and also, do you really need or can even use a 22 volt trans here, or will a 11-14 or 12-15 do? is the yard even big enough to justify a 22 volt trans? can any customer actually see the lumen difference a laser accurate .5 volt step trans gives you ? because those are items that cost you money. You may think you can pass them on to the customer in terms of value and higher prices, but if they are not needed and cannot be seen, are you?

Those dollars, llike the shipping dollars, like the 10-25 dollar difference in wire spool prices, COUNT. the overall cost of your connections, and yes, if the fixtures all work the same, perform the same, and last the same, the dollar differences count. I will completely agree that many fixtures are not the same. paths, wall washers, those all behave so violently different with the same bulb it is unreal. but bullets for me, there are some to choose from that work for me and perform the same. so those dollars count.

on my mythical 19 fixture job has a mix of 4 paths, 14 bullets and 1 wall washer. The lady is older and wants very bright paths and 3 of those need to be 35 watt g6's. the home is one story, so all my uplights there are 20 watts, the trees are all ornamental, so I am planning on all my mr-16's are 20 as well. the washer is probably a 20 watt g6, but maybe a 35. so we are at 105+20+280+20 =425 plus maybe another 15 if you bump the washer. so at 440 watts I would stick to a 600 watt unless I knew she was adding on in the future. That decision is made easier if your cost of trans difference is less than 40 bucks. but that 40 bucks is still 40 bucks . I would not really consider 2 300's unless it was a clean split front and back design, even if I have to go over a drive way or run another 100 ft of cable, the labor cost of an hour or two or 20 bucks on wire would no way justify for me 2 different photocell "on" times every day. further, and more important to the point of this thread, is cost. 2 300's are always going to be higher than a single 600. and usually by more than a little bit.

For me, I am also careful on my wire use and overuse. I run my loads mostly on 12 huage and 10, but I only use 10 on the longer runs and I have used 8 on rare crazy long runs. I hate any wire pieces I cut off when we overestimate height of trans mount longer than 2 feet.

and the final place your money is going are the toys. You know it, I know it and lets admit it. how many of us buy a new tool or gadget every time we get a decent size job and chalk it up to business? you have a corded hammer drill, but you get a 8000 buck job. now you can finally buy the cordless dewalt 18 volt lithium xpg kit with the hammer drill for 499. ooh, it comes with a flashlight ! Your old scratchy greenlee rms clamp meter works fine, but that 600 amp backlit fluke 400 buck job down at grainger sure looks easy to buy when you have that draw money from the 11000 dollar job. need new cutters, yours has a nick in it? how about a new 6 in one screwdriver, or your strippers are starting to stick. 25 bucks, 10 bucks, 5 bucks. maybe you do this every 2 jobs, every 3 jobs. but it adds up. quick. how quick?

On every job, without the toy intervention, I can honestly say I could either go with the most expensive choices on superflex wire, pay the highest for a 22 volt watt trans rather than 12-15 and pay shipping, buy the highest cost bullets and paths in my stable, ( although that is just for me. some of you guys need way higher cost than even I will buy ), and on top of that , be a bit wasteful with wire here and there, or go the other way- be careful what you spend. I ran the numbers on the mentioned mythical 5000 buck job, and the difference is staggering when I shoot the works versus be careful.

it is 580 bucks. even one loose choice here was 50-100 bucks. a ten dollar difference fixture cost can cost you 200. I am trying to do 70 jobs this year, this size. many of you do more volume than that. I cannot in good conscience take 40 grand this year not pay attention to it.

So be honest, look at the numbers, and ask yourself where you spend your inventory/1st draw dollars. you know you have choices and you can make wise ones on dollars. where's your spread on what you could maximum spend and minimum, even within your favorite choices?

Classic Lighting
01-20-2010, 06:05 PM
You sure do have a lot on your mind.

Generally speaking, I buy what the customer expects and is paying for, not for future expansion. I do not feel it is wise to "hope" they will call back for add-ons.
Regarding tools, I buy very modestly. I have the basics and nothing extraordinary. My business is not to the point where I am 40 hrs/week lighting. I cannot justify buying the nice items.

However, I do buy quality items for the install/service. I am a big brand fan of Cast, Unique, Paige wire, Ushio, and GE.. Currently, I am happy with their product and see no reason to look elsewhere for materials.

In this economy, I feel that you are a fool is you don't spend wisely and work efficiently.

INTEGRA Bespoke Lighting
01-20-2010, 06:29 PM
Wow David... are you ok there bud? I know what you are saying, but the 30mins that you took to write that diatribe could have been spent much more efficiently! :)

In tight times, or on jobs where you had to compete on price to win the bid, then by all means work as efficiently as possible. I would suggest that you could probably find more effective efficiencies in your labor and practices than you can on product substitutions. Work longer days means fewer trips, etc etc.

As for tools... well I stand by the premise that good tools don't cost you money, they make you money. ( I have a bit of a 'quality tool habit' mind you... there are worse vices in life :) )

As for over-sizing transformers for future additions... I only do it when the client is willing to pay for it. It is not something I would 'hide' in my quote. Rather be up-front about why you are doing and what the incremental cost of the over-sizing is compared to right-sizing. Let the client make that decision for you.

My last point (and I am not trying to be a smarta-- here) is to focus on finding larger, higher end jobs! This is absolutely critical to small, niche market businesses. Think of the fixed costs and hidden expenses that go into landing your jobs. It is actually much easier, and more rewarding (in so many ways) to do 15-20 jobs per year than it is to do 70! Your time spent on selling, trips to site, and collections are actually higher per job for the small jobs than they are for large jobs. Also the time spent designing, procuring, processing AP, etc is not being considered when you talk about landing so many jobs. This is time you will never get back and in my experience, it takes the same amount of time to procure and pay for a large job as it does a small one.

Lots to think about.

David Gretzmier
01-21-2010, 12:48 AM
James, I guess I am afraid of the really big jobs, as my largest landscape lighting jobs that I can think of has got to be in the $15000 area. I have done larger landscape install jobs, over 100k, and a few large Christmas light install jobs of over 65k, but the big landscape light jobs don't really come my way, i'd have to go looking for them. My marketing for both of my lighting areas tend to bring me leads that spend in the 3k to 10 k range. I like those jobs, they present a challenge here and there but no frustrations with huge wiring runs and homeowners typically at that price point are very easy to work with and most just love to get lighting initially. I worked on two of those this week while my guys are still taking Christmas lights down.

The trans upgrade issue seems to come up alot. mark my words. I will do many 10-12 fixture jobs this year and a 300 watt trans will be fine. install trans, wires, lights, finished in one day. next day they love it so much they want to add 4-5 more lights. uh oh, now I have to take out 300 and put in 600, find a home for the 300, and oh, by the way, I don't keep a 600 laying around usually. and many times the incremental cost of a 600 makes a 300 seem silly. but if they will never move beyond the 200-240 watts, then the 300 is fine.

INTEGRA Bespoke Lighting
01-21-2010, 01:00 AM
David, give some more thought to what I say about the hidden/soft costs associated with smaller vs larger jobs.

If you are able to land Christmas Lighting gigs of over $65K (per year for the same home??) then you certainly have the market depth and breadth to find Landscape Lighting jobs in that same range. Just imagine how much simpler your marketing, sales, procurement, ARs, APs, etc would be if your avg job increased dramatically.

INTEGRA Bespoke Lighting
01-21-2010, 01:01 AM
Duplicate post

niteliters
01-21-2010, 07:08 AM
you mentioned large landscape projects, christmas lighting etc. sorry if u have said in another post...what is your percentage breakdown on the work you? How much is landscaping, christmas lights, outdoor lighting? do you do anything else? I know James is going to tease me on this one, but you need to get in your vehicle next tuesday, make the ten hour drive to San antonio, attend the AOLP conference, have some face to face time with other passionate lighting guys who have struggled with these same issues...get your batteries charged up for the spring. more to say later, I am leaving early to start the battery charging. :)

David Gretzmier
01-21-2010, 11:25 PM
I no longer do landscape install, but did own a million plus sales company that did that, plus irrigation, chemical lawn work, beds, maintenance, etc. So I have done most facets of the green industry. we do Christmas lights from Sept 15- Feb 1, and take most of feb. off, and landscape lights from March 1-Sept 15. I do overlap some, as we did 2 landscape light intalls this week, and did one back when Christmas lights were up in the 2nd week of December or so.

I would like to have gone, but I will be in the carribbean next tuesday, but I have looked into AOLP. I am not opposed to it, actually very interested.

GreenLight
01-30-2010, 11:34 AM
and the final place your money is going are the toys. You know it, I know it and lets admit it. how many of us buy a new tool or gadget every time we get a decent size job and chalk it up to business? you have a corded hammer drill, but you get a 8000 buck job. now you can finally buy the cordless dewalt 18 volt lithium xpg kit with the hammer drill for 499. ooh, it comes with a flashlight ! Your old scratchy greenlee rms clamp meter works fine, but that 600 amp backlit fluke 400 buck job down at grainger sure looks easy to buy when you have that draw money from the 11000 dollar job. need new cutters, yours has a nick in it? how about a new 6 in one screwdriver, or your strippers are starting to stick. 25 bucks, 10 bucks, 5 bucks. maybe you do this every 2 jobs, every 3 jobs. but it adds up. quick. how quick?



Are you following me around or something? lol ... I have the sickness, I basically have to limit my trips to home depot, lowes, etc... I seriously can't walk in those places and simply buy what I need for the job (extra wirenuts, caulk, touch up stuff). If I walk in Home Depot or Lowes at some point im going to be in the tool department. Which means one of two things, im either going to find something to buy immediately or find something that Im budgeting to buy within a two week span. You are right, im not just talking about a screwdriver or something. I won't hesitate to lay down $300.00 bucks for a new cordless drill or reciprocating saw or circular. It's weird, I already own 1 dewalt corded hammer drill and 1 dewalt cordless 18 volt lithium drill, porter cable and milwaukee cordless drills. That's 4 drills I own and all of which are working well. THE SAD PART, I still look at drills when I go in either of those stores.

S&MLL
01-30-2010, 03:39 PM
http://www.homedepot.com/webapp/wcs/stores/servlet/ProductDisplay?storeId=10051&productId=100614866&langId=-1&catalogId=10053&ci_src=14110944&ci_sku=100614866&cm_mmc=shopping-_-googlebase-_-D25X-_-100614866


Thats the next one

ccfree
02-04-2010, 10:59 PM
David, why don't you just buy your lighting products locally from a supplier to save yourself the cost of freight? I know of a couple great suppliers in the Bentonville and Springdale areas.