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Question re: markup, quotes

Discussion in 'Irrigation' started by TheOtter, Apr 30, 2008.

  1. TheOtter

    TheOtter LawnSite Member
    Messages: 12

    I wasn't sure if I should put this in the homeowner forum, but since it's so specific to irrigation, I decided to put it here. Sorry if that was wrong.

    I'm a homeowner in the process of cleaning up after the previous owner's crappy work all over the house. We've used the same irrigation company for the past two years for startups/shutdowns, and now we're going to get some real work done: move (and replace) 6 heads for better coverage, and replace the outdoor controller (3-zone).

    My question has to do with markup over retail (internet) prices on the equipment. I know some markup is normal, but their quote has the controller box for almost twice what I can find on the internet - $200 (plus $65 for 1 hour labor) for an outdoor Hunter Pro-C controller, when it looks like these things go for around $100 - $110 retail.

    Is that normal? It seems high to me to charge labor and 100% markup over retail...

    How would you guys react if a homeowner offered to purchase the controller themselves and pay you to install it? Should I get a quote from another company? I've been very happy with the work these guys do (what little I've had done), but I have not been happy with the business' communications - things like being 4 hours late for an appointment and not calling ahead to let me know.

    I appreciate any thoughts...

  2. Wet_Boots

    Wet_Boots LawnSite Fanatic
    Messages: 50,592

    Internet prices are not retail list. Lose that idea real quick, or do the work yourself.
  3. TheOtter

    TheOtter LawnSite Member
    Messages: 12

    Ok - point taken. "Retail" was probably the wrong word. I have no delusions about doing this work myself. As I said, I'm trying to fix up my house after the previous owner did everything halfa$$ed.

    Perhaps I should rephrase - is $200 plus $65 labor a reasonable price for that controller? And, if someone called you up and said, "I already have a controller, how much for you to install it?" would you take on that job for labor-only rates (in addition to the other work on the system, which is 4-6 labor hours) or is that just not done in this industry?

    I may get another quote simply because of the communications problems anyway, but I'd like to know if this sounds like a typical quote or not, so I know what to expect.

    Thanks again...
  4. Wet_Boots

    Wet_Boots LawnSite Fanatic
    Messages: 50,592

    It's kind of like having car parts and asking a garage to install them for you. In the world of irrigation, you might actually find a lower price online than your installer pays. But the installer gets manufacturer and distributor support you never will. And an installer will support what he buys and installs. He cannot offer support for what you buy.

    As for missed appointments, one does want to keep customers informed, but it's hard sometimes to climb out of a muddy trench to let the next customer know that there's going to be a delay, especially when the current situation isn't completely diagnosed.
  5. TheOtter

    TheOtter LawnSite Member
    Messages: 12

    Fair enough / makes sense. Thanks for the replies. I'm definitely not trying to lowball. I just don't want to be taken for a ride, either.

    I understand about the trenches thing, but it seems like every time we've had something done, something has been off with them letting us know what's going on, so it just hasn't felt comfortable. Maybe I'm overreacting, but it's things like the secretary telling us they'll call with a time estimate when our startup date gets closer, and then no call. Or, when we reminded them that the tech said he'd be fixing something (can't remember what) on his next visit, but he showed up without the equipment, saying they didn't put it in the file for him that morning.

    I work from home, so it's never a huge deal, but knowing an approximate time helps me schedule my work (meetings and such) or errands around it. I'm sure I'm preaching to the choir - from lurking around here a couple of days, everyone here seems to have a great business attitude.

    I like their techs, so maybe a little under-communication is worth the good work, but then again, maybe not?
  6. Flow Control

    Flow Control LawnSite Bronze Member
    Messages: 1,267

    Well put.....
  7. irrig8r

    irrig8r LawnSite Platinum Member
    Messages: 4,553

    I was challenged by a customer just other day about a quote I gave him for a Sidekick FM 12 remote. (Large property and he just wants to monitor it better.)

    He went to sprinklerwarehouse.com and saw that he could buy the same unit for less than I would pay through my distributor, and avoid CA sales tax too.

    My distributor said that at that price he would be making less than 5% markup.

    So, instead of me buying it and marking it up further and then having to deal with any service or warranty hassles, I suggested he go directly to my distributor, pay the additional markup (but less than I would have to charge him) and then be confident that they would handle any warranty issues that came up for him.

    Meanwhile, I'm doing other T and M work for him anyway and will just charge my normal hourly rate to install the pigtail and test it, so I'm giving him a pass on this one.

    This is a rare exception to my normal approach.

    Remember that we are all in business to make a profit. Even if we enjoy our work we can't afford to give it away.

    When a contractor doesn't know his true costs of doing business, that is, just being able to open the doors, answer the phones, and put vehicles and equipment on the road every day, and doesn't price jobs accordingly, then you can be assured he won't be in business long.
  8. TheOtter

    TheOtter LawnSite Member
    Messages: 12

    Thanks Gregg. That's why I came here before making a deal out of it. I wanted to know if the price is fair and reasonable - sounds like it is.
  9. Wet_Boots

    Wet_Boots LawnSite Fanatic
    Messages: 50,592

    Controllers especially justify their list prices, because they require more installer support than most anything else.
  10. TheOtter

    TheOtter LawnSite Member
    Messages: 12

    Interesting. Is that because they malfunction, or because most people who aren't familiar with them have trouble operating them?

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