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View Full Version : instant bid = higher sign rate?



huggytree
11-22-2009, 05:16 PM
My advertising and referrals get me to be the 1st bid almost 90% of the time with homeowners...

I almost always go outside and write out the bid and hand it to them...instant bid...

I had a salesman tell me how he also does that and it gets him instant signed jobs all the time....all i could say is WOW

Its rare anyone looks at my bids and signs....im always SHOCKED when it happens....its just that rare its SHOCKS ME!..i almost step back in amazement

I feel the reason is that the 1st bid is the reality check....they expect their new bathroom to cost $2k and my bid is $4k....50% off is the normal...i talk with my contractor friends and they also see the 50% rule..

now if im the 3rd bid and do an instant bid my odds are 75% that they will sign on the spot....its just soooo rare im the last bid.

any experience or suggestions on how to close my sales when they experience 50% higher sticker shock?

I go over all my better quality parts, I go over all the trade associations im in, I go over my quality install, I explain how long it will take and how i will show up on schedule.....

I havent found the instant bid to help at all....if the bid is late im sure it would hurt though...when i did my roof years ago i had bids come in after the roof was done...it was crazy.....

a builder i worked with used to refuse to submit her bid 1st...she said when they recieve their other 2 bids to call her...she would them go over and sit down and compare bids....I dont know if customers would go for this or not...its something to try.....i didnt notice her signing any more projects than anyone else...

do any of you do instant bids? any advice on how to make it work better?

billbenson
11-22-2009, 08:24 PM
I'd go back to my other post and stick it in a database. You could use an excel sheet initially.

Put a laptop and printer in your truck. That way you can print out a professional quote with letter head etc. Your quote will look 1000% better than handwritten quotes and take you less time to do it.

Maybe that would help, maybe not, but I doubt it would hurt.

Steve B
11-23-2009, 06:15 AM
I have the same issue - but, even worse. I give all my bids over the phone without ever meeting the client. All my competitors make an appointment and do it in person. I do this because I'm busy enough that I don't have time to run all over town giving three plus bids a day. But, I'm not so busy that I can justify hiring more people. Sometimes I get a job because I'm so quick, but I probably lose more because I wasn't there in person.

The way I try to combat this is to be very good on the phone, answer the phone, and/or return messages quickly. I also direct people to my website. I have a far better website than anyone I compete with, so I try to let that be my sales staff. My website is so good, I just found out one of my friends in another part of the country that is doing dog fences tells people to look at my website (he's too cheap to build his own!).

This is becoming less of an issue as my reputation grows and I get more referrals.

handprop
11-24-2009, 08:08 AM
That's a dog that wont hunt!

Business Attorney
11-24-2009, 10:11 AM
I think giving an instant bid will usually only help in those instances where your bid falls at or under the homeowner's preconceived idea of what the project will cost. Will that happen? Even though you have indicated in other posts that you are typically not the low-priced guy, there are bound to be some people who have over-estimated the cost of the job.

If someone thinks the job is going to cost $4,000 and your bid comes in at $3,500, then handing them a bid may land you the job before the low-cost plumber can come in and give them a bid for $2,800.

huggytree
11-24-2009, 06:04 PM
the times people have signed on the spot do appear to be situations where they estimated the cost themselves correctly.

when i have contractors do work on my own house i underestimate also...contractor costs are always shocking....

cocoy
12-03-2009, 04:39 PM
I always tell my clients to compare bids line by line or ask the architects or engineer involved to check it over also. Contractors sometimes give a low bid and leave out items hoping the customer won't notice. When they get the job they'll charge extra for something that wasn't included in their bid, but was included in others. I'm seeing this a lot lately with commercial contractors.

Spider
12-03-2009, 05:12 PM
I always tell my clients to compare bids line by line or ask the architects or engineer involved to check it over also. Contractors sometimes give a low bid and leave out items hoping the customer won't notice. When they get the job they'll charge extra for something that wasn't included in their bid, but was included in others. I'm seeing this a lot lately with commercial contractors.This is the result of handing a number of contractors a set of drawings and asking each of them to bid on the work. Each contractor has to take off their own quantities. Miscalculations occur - up or down, different qualities are priced depending on how loosely the specs are worded and whether certain items are actually specified. The drawings are not always perfectly clear and different contractors make different assumptions. The result is, the bids are not directly comparable.

Where the contractors are given a set of drawing AND a previously-prepared bill of quatities (being a list of all the items and the quantities of each that are to be included) plus a separate set of specifications for every item needed - then the contractors are pricing exactly the same job, using the exact same quantities and same stated specifications. Then - and only then - can the contractors bids be properly compared.

It means the client or the architect must hire a professional to take off the quantities and prepare a bill of quantities to give to the contractors to bid on. Where that is not done, the confusion, disagreements, ill-will and extras increase the cost of construction for everybody.

cocoy
12-03-2009, 06:19 PM
Contractors can look at the drawings and count how many receptacles, lights, diffusers, toilets etc... are to be installed. Which ones are new and which are existing to remain or relocated. If they don't know how to read that from a drawing then they have no business trying to build it. If they miscounted then it's on them.

Yes. Sometimes drawings are not clear. All they have to do is ask for clarification if they don't know. I've seen some put a count on their bids to make it clear that this is how many they are going to install.

All our drawings include specs for the larger items, fixtures, diffusers, etc... I won't spec what brand 1/2" shut-off valve to install (at least on small jobs), but I'll spec the sink, fixtures or the heat pump.

I've had contractors come back after they win the job and submit cheaper products and they always say they're trying to save the client money or that there's a long lead time. Sometimes it's legit and sometimes I'll call them on it and ask if they'll give back a credit because that's not what they bid on. They always end up re-submitting the right equipment. I had one tell me flat out that the item I specified wasn't made anymore. A quick call to the manufacturer verified he was lying. His supplier just didn't carry this particular brand and he would have to pay more from another supplier. Even when I put "Not Substitutions" on the drawing, I sometimes still get them.

If I sound like I don't like or trust contractors, it's because of the type I've seen lately. It was never like this a few years ago.

I recently had bids come back and one bid was cheaper by 15-20K. I looked at it closer and it's stated that the fire alarm system wasn't included in the bid. They fully intended on doing that work, but for some reason did not include it on their bid. I never got a straight answer as to why they didn't include it in the first place. I just got, "It's not part of that bid." They added it after I asked them to. Complete waste of everyone's time.

Don't get me going on poor workmanship either. :) Many general contractors are using cheaper subs who have no idea what they're doing.

Spider
12-03-2009, 06:46 PM
Your whole post could be used as support for the idea of a bill of quantities being prepared and handed to the contractors for bidding.

Contractors can look at the drawings and count how many receptacles, lights, diffusers, toilets etc... are to be installed.

Sure, they can - along with the amount of 2" pipe and 4" pipe and 6" pipe and the number of bends and elbows and branches, for water supply and waste - and how much of each type and carrying capacity of electrical cable, and telephone cable, and the conduit and the bends, etc. - and total length of each size of ducting - and the total amount of concrete and formwork, and total quantity of studding and other structural timbers and steel beams, and drywall and siding......

If each contractor is required to prepare his own take off, the bids are not comparable.

All our drawings include specs for the larger items, fixtures, diffusers, etc... I won't spec what brand 1/2" shut-off valve to install..

Specifying some and not all the equipment leaves the contractor to choose his own specification, and the client to suffer as a consequence. And the bids are not comparable.

..I looked at it closer and it's stated that the fire alarm system wasn't included in the bid.

If you have a bill of quantities that all contractors used to bid on, a) you wouldn't have to look closely to see an omission, and b) the contractor would not be able to submit a bid with a portion of it missing.

Still, this is all about larger bids. I think this thread is about work that would be done in a few hours and prepared in the driveway of the client's house. But where the job is large enough to warrant getting several bids, it is certainly more efficient and more economical along with higher quality assurance if drawings and a BOQ is handed to contractors for their bids.

cocoy
12-04-2009, 11:16 AM
Nobody makes an itemized list for the contractors around here and the bids are fairly comparable. It's only way off when items are omitted, or when the GC doesn't know how to do a bid.

Well, like you said I'm talking about bigger bids here and several thousand dollars differenced between bids can still be considered comparable.

On to the next subject. :)

cocoy
12-04-2009, 12:44 PM
a builder i worked with used to refuse to submit her bid 1st...she said when they recieve their other 2 bids to call her...she would them go over and sit down and compare bids....I dont know if customers would go for this or not...its something to try.....i didnt notice her signing any more projects than anyone else...

Does she change her bid after comparing?
Sounds like she may be changing her bid on the spot with the customers while going over it. Talking to them and maybe changing certain items to get a better final price. More of a negotiation process. i.e. We can install a nicer toilet if we install a cheaper sink.

It may work with some homeowners. Talking to them and telling then about the quality of your products wouldn't hurt.

huggytree
12-06-2009, 03:51 PM
Her whole reason was to accurately compare bids. She did not change prices...

Ive seen my competitors bids and if i also sat down with them to go over bids I could put questions in their heads about what the other bidders are giving her...most of my competitors bids are horrible...usually you cant tell what your even getting.

Ive lost jobs because i use better fixtures and refuse to install some low end brands...the homeowners/builders dont realize that my bid is more because your getting more.....by sitting down and comparing bids with them i could show them the ways the others cheat to lower their bids...my prices are always fair and my parts used are always great quality...i dont skimp......problem is others do and the homeowner needs to be educated to know what they are getting for their money...

If i ever get to bid a large homeowner job again i may use this a few times to see the result....thats probably 4 months away or more though.

Spider
12-06-2009, 05:53 PM
...Well, like you said I'm talking about bigger bids here and several thousand dollars differenced between bids can still be considered comparable...I used to bid multi-million dollar projects for a large general contractor, and would win bids by a thousand dollars or so. It was quite common for the lowest three bids to come in within a $10,000 spread, on a $5 to 10 million job. Very exciting, if you like working with numbers!

But you can only get that close accurately when all bidders are working from the same bill of quantities.

Sometimes I miss those days!