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ITRO - just how big is 'the region'?

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Forum topic by 404 - Not Found posted 06-01-2013 01:11 AM 708 views 0 times favorited 8 replies Add to Favorites Watch
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404 - Not Found

2544 posts in 1714 days


06-01-2013 01:11 AM

In woodworking, if you give an estimate for a job ‘in the region of’ $XXXX but it turns out to be more, is there a limit, expressed as a percentage perhaps, where you exceed ‘the region’? 0-10%, 10-20%, 20-30% etc?

Is it down to each man and his conscience?

Is it good or bad business to ask a customer to meet you half way?


8 replies so far

View Buckethead's profile

Buckethead

1935 posts in 614 days


#1 posted 06-01-2013 01:13 AM

Double… Or a margin of error of 100%.

Look at thebrightside, Mr Client! If its 100%to the downside, you get it free!

-- Bucket, any person that spends 10k on a bicycle is guaranteed to be a $@I almost started to like you. -bhog

View casual1carpenter's profile

casual1carpenter

353 posts in 1221 days


#2 posted 06-01-2013 03:07 AM

I would hazard a guess to say that your conscience should be your guide. As you asked the question I would also hazard another guess that the little conscience guy might have tapped your shoulder once or twice and whispered in your ear. At the end of the job will you and the client both be happy with the outcome?

When the potential customer receives an estimate they use your estimate amount to make their decision as to the contractor and even perhaps materials that will be used. A small town builder did some work for me years ago, his bid showed current prices for materials to be used, estimated man hours, and a rather complete list and description of the work to be performed at the estimated price. Then his bid form stated that anything not covered by bid, customer add-ons or hidden work like a building deficiency was to be paid at time and material at $xxx.xx per hr per him and a lesser amount per helper along with a stated material markup.

If you can show good and reasonable cause for an overage then I personally feel that the customer should be informed in detail as early as possible. As a small businessman my local guy earned me as a friend, client, and reference for life. He did high quality work at a reasonable price and I honestly believe that he under charged for the T&M areas that did come up.

Ask yourself how you would feel if your suppliers did that to you? Or how you would feel if the customer only paid a percentage of your stated billing? Perhaps they hired an extremely higher priced contractor to repair some of your work that they claimed was deficient without giving you a chance to defend yourself or even make good the work and back charged you for that amount.

Business is business and you should make money on your jobs but business is also about professionalism, quality work and customer relations, especially in areas where word of mouth might win or lose you jobs.

I happened to reload the page before posting and James had his posting up and for the most part i agree with him.

View 404 - Not Found's profile

404 - Not Found

2544 posts in 1714 days


#3 posted 06-01-2013 11:18 AM

I ask the question because the job I’m currently working on had an estimate submitted over a year ago. My client put the job on the back burner to concentrate on the outside of the house. In the year that has lapsed, the cost of materials has gone up, especially opal laminated glass, the melamine faced boards and the maple. I reckon its going to add $230 to the job, not a huge amount of money, but I’d rather not take a hit on it.

View johnstoneb's profile

johnstoneb

790 posts in 918 days


#4 posted 06-01-2013 11:49 AM

An estimate should always have a time limit that it is good for. Never give a ball park figure. If it is too high you’ll never hear back from the customer. They’ll go to some one else that gave them a lower estimate without coming back to you for a more concrete figure. If it is low as far as the customer is concerned that is the figure you gave them and you need to do the job for that.
James is right on with everything he said.

-- Bruce, Boise, ID

View TheWoodenOyster's profile

TheWoodenOyster

1034 posts in 680 days


#5 posted 06-01-2013 12:34 PM

Add the $230 to your price. They should understand that material prices change during the course of a year, thus your expenses for the project change too. Ask them what the price of copper was 1 year ago compared to what it is today. Just an example, but all material prices change based on the market. I wouldn’t feel bad at all about adding that to the price, just explain it to them simply and if they freak out then who needs em.

-- The Wood Is Your Oyster

View casual1carpenter's profile

casual1carpenter

353 posts in 1221 days


#6 posted 06-01-2013 01:11 PM

renners, I would tell the client that while they put the project on the back burner material prices and overhead costs have risen and show them numbers. Tell them that you really need them to meet you halfway and that if they could cover the additional material prices you could absorb the additional overhead costs. Be honest and tell them that is was a tough decision for as your work ethic has always been “quality work for reasonable prices” and because they had delayed the start date and material acquisition you felt that you would have to either get some help with the inflation or perhaps drop to slightly lesser cost materials.

View CharlieM1958's profile

CharlieM1958

15786 posts in 2964 days


#7 posted 06-01-2013 02:56 PM

In this case, I think you are perfectly justified to tell the customer the price of materials has gone up in the long period of time since you gave the estimate. Of course, as James said, you have to take into consideration all the other factors. Is the customer really hard to please? Will they balk at the increase? Is the job big enough to eat the $230 rather than risk losing it?

I deal with contractors a lot in my job. Generally, it is the contractor’s responsibility to decide, based on the nature of the job, whether to give a firm price, or a time+materials estimate. If I get a firm price, I expect it to stick. The contractor is going to need a really convincing argument to get me to pay more. If the job looks like it has a lot of uncertainties (like not knowing what will be discovered during demolition) a time+materials estimate is appropriate. If that happens, I expect the contractor to furnish with his invoice a complete package with copies of receipts for materials, and an accounting of all hours worked by him and his helpers.

-- Charlie M. "Woodworking - patience = firewood"

View Moron's profile

Moron

4723 posts in 2639 days


#8 posted 06-03-2013 01:52 PM

Jus sayn

Reputation is golden so not knowing the final price you put on this project I cant say if you should eat it but ie., if you quoted 10K, I’ld take the hit as the payback, word of mouth might pay more going forward then trying to squeeze a few bucks more

jus sayn

-- "Good artists borrow, great artists steal”…..Picasso

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