Newbies & Prices

[Rob Blair]

Just a rabbit trail from that rather long debate.(good on ya Craig)

I hear the Newbies taking a lot of heat for lowballing and under cutting prices in our industry, but I will have to come to their defense. In my area (western Washington) it is not the newbies that are doing the lowballing. It is the guy who has been around for 20 years that is doing it! Seen it happen here several times in the last 6 weeks. Might not be happening that way in your area. I for one am going to cut these newbies some slack. They have resources like this board to help them get started and I think most of them have alot more going for them than when some of the rest of us were getting started. Before you answer think about it a little, is it really the newbies cutting prices in your area? Maybe the weekend warriors, maybe the experienced pros.

Rob

 

[Ramon]

Around here the big guys keep the prices low in fleetwashing. It sures keeps the newbees out. I am an advanced newbee and can finally compete with them. I don't know if it is better to keep prices low or raise them and open the gate of new business start-ups and create more competitors. Any input anyone?

Ramon

 

[Craig/PowerWashUnlimited]

Rob,

Sometimes the newbie needs work bad enough to reduce prices to a point he feels he will get the work without customers further searching for a lower price, which i did in the past. Since that time, i have found out that customers respect a more professional appearance and contractor with the knowledge to explain the process and procedures they will perform on their property. Many customers price check, others perfer the professional and are impressed with their pricing even if it is above the rest of the competition. I was just trying to get out to all a up to date price guide that would be a starting point for all to use, when needed for a project they haven't performed before. For example, i have recently posted, as well as others on the bb, asking for advice on what to charge and look for when cleaning structure that i have, and they have, never attempted before. This would have helped, but in short, your right about the lowballing, it is not generally done by newbies in my area either. Commercially, It is usually done by a landscaping company that will go rent a small pressure washer and attempt to do the job for a little extra income or the larger companies that specialize in one field.


Craig

 

[Rob Blair]

Hi Craig,

I think your idea on the prices is a good one and would help me also in any areas I haven't washed before. I'm not to proud to admit that I don't know everything and wouldn't benefit from this guide. My comment on the newbies was just something I thought of while reading through the posts. I agree with you on the price/professional thing. We actually picked up a new contract this week because of the lack of quality on the prior contractors work and we are charging considerably more. I like to work for an outfit that wants quality first and doesn't mind paying for it. They wanted it done right and that is what we do. Have a good one.........Rob

 

[hotwaterwisard]

I sell pressure washers to alot of Newbees. They ask me the pricing. I tell them 10 cents a square foot or $65 per hour. I know there are other Distributors out there selling machines and they are the ones that get the Newbees started. Maybe they should be informed by their existing customers of the pricing. That would be you guys. My suggestion is to tell all of the service centersIn your area how much the going price is so the new commers are in line with your pricing. Then you set the prices in your area.

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Hotwaterwizard@aol.com John DeRosa "If I Can't fix it no one can."

 

[Jon]

Rob Blair,

Could be those 20 year veterns don't want competition so they low ball on purpose, shame on them, they were newbies at one time too!

John,(hotwaterwisard)
By telling the newbie to set his price at$65 an hour would be considered price fixing, besides he might find that the going rate is less or more. I would say to start around $50 or so and as you gain experience then you can start raising prices till your comfortable with your profit margain.

Recall in the other post about a new price guide, I said I first bid jobs using that outdated list, got no work, then I lowered my prices till work came in and I got busier? After I gained experience I slowly raised them, still I overbid at times.

Every city, state, area etc has its own price ranges, $65 an hour might be to high on one place and way to low in another.

David spoke about price fixing, your doing it by quoting a price to charge, give them a range to work with and all shall be better.

Jon

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Beep beep, the OPC Roadrunner coming through.

Jon Fleischer
Oasis Pressure Cleaning
(909) 792-2247
Fax (909) 792-5633

 

[CleanImage]

Back when there were no price guides or chat boards to reflect prices, I used an old system learned by many - the WAG method of estimating (Wild A** Guess). After years of "training", and gaining "experience" in the field, we went on to the SWAG method (Scientific, Wild A** Guess). Basically, I think everyone in business needs to go through both levels to find what works for them. A few years ago, a company I worked for, hired a student straight out school, with a degree in estimating. He didn't have a clue on what the conditions in the real world were. Price guides are a great tool to start with, and the information passed along on this board is invaluable. But, I think you have to get out there and find out what works, how fast/efficient it can be done, what the competition is doing, etc. Bidding against newbies, I sell them on our experience, against the big companies I sell them on personal service and attention to detail. I've seen a lot of cleaning contracts going to janitorial services and parking lot sweepers in the last two years, but some of there contracts are coming back, because they just can't give them the service the smaller companies can.
Did I get off the subject? Man, I do that a lot……..anyhow hope some of this makes sense or helps someone out.

Duane - CleanImage
Property Services, Inc.

 

[AranPressureWashing]

... hey Jon,
That's not price fixing to tell the newbie that he needs to be making about $65.00 to $75.00 dollars per hour.

The fact is that is where the cost of doing business sets the price if you are set up with the right equipment.

Another way to look at it is that your material cost should be about 18 1/2 to 19 1/2 percent of your actual bid.
This isn't price fixing - this is the cost of doing business and being able to afford to grow & replace equipment with more and/or better tools for your selected niche.

Anything lower than that & you are at very least a borderline WELFARE OFFICE.

Like my pop used to say
BIRD OF FEATHER FLOCK TOGETHER!

I choose to be with the successful folks!

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Cleaning America - One Job At A Time!
I love My Boss! I Married Her!
E-MAIL: Randy Ferrantino at aran@bellsouth.net

 

[Jon]

Hey Randy,

I ain't no loser, no way no how.

I make a buck and spend two.

But I do understand the cost factor here, would not be in business and making a profit if I did not. I also don't buy the cheapest chemicals, nor the most expensive. I buy what works best for my jobs.

I will admit that my supplier also told me a figure when I first got my equipment, and he said Jon, your just starting out so charge $45 to $50 an hour till you gain experience.

I sort of figured any leads he gave me I would have to quote that price, but that accounts I get my price will be higher, I do love good food.

Now what did I do with my shovel and bucket, need to mix another batch of "chemicals from this dirt pile" to rub into that greasy trash area

Jon

------------------
Beep beep, the OPC Roadrunner coming through.

Jon Fleischer
Oasis Pressure Cleaning
(909) 792-2247
Fax (909) 792-5633

 

[Jim]

The problem on telling a Newbie too make $40- $60 an hour is mis-leading. You Pro's have technique,speed and rythym. What may take me 4 hrs, you can do in 1.5hrs. So, what am I supposed to do bid $240 (4hrs. x $60 per hr.) on a house that you can do for about $100. So what is the best way to bid on something?

Jim

 

[David l Saulque]

Sounds like a old record-In general terms 10 cents a foot and $65 hour is not price fixing. It becomes price fixing when it becomes a group effort to exclude and to control price. The Waterwizard is acting on his own and only giving advise.


David

 

[Jon]

David,

Looks like we come full circle now, me saying price fixing and you saying no.

That's life for you, still we all pull together and help each other when needed.


Jon

------------------
Beep beep, the OPC Roadrunner coming through.

Jon Fleischer
Oasis Pressure Cleaning
(909) 792-2247
Fax (909) 792-5633

 

[David l Saulque]

See Jon with you being just three years older than I, you take point.

David

 

[Scott Stone]

The pricing is where experience tells. That is why the old pros are able to charge less for the same thing. Unfortunately for the new guys they have to speed up or learn to compete with lower prices. Believe me that we have all been there. As for price fixing, just about every serious profession has price guidelines. They also have multiples of professionals that refuse to follow the guidelines. They either charge more or less. It is just something that happens.

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Any statement that I make about equipment, processes or your hair color is my own personal opinion. I usually base it on personal experience. If you disagree with me you are free to reply on both the BBS and by e-mail. If I am totally off base please explain why on the BBS so that we may all know why
Bus. Phone 480-834-3434
Cell Phone 602-509-9741

 

[Ramon]

I agree Scott,

Experience says alot. A local competitor does 53' trailers in 5 minutes. 4 guys and 2 machines. If he charges $10 each that's 120 hr. gross. Deduct 60 per hour from that for labor, fuel, chemicals, and equipment depreciation. I believe he charges more than 10 dollars but I will use it for an example. So basically he nets 60 per hour when all is said and done. Is he lowballing? Or has he just found a way to make good money and keep 90% of his competitors away from his accounts? It is hard to say what it should cost to do this type of work. I can't do it that cheap therefore I don't bid on these accounts. I would like to hear what others think.

 

[AranPressureWashing]

Originally posted by Jon:
Hey Randy,

I ain't no loser, no way no how.

I make a buck and spend two.

But I do understand the cost factor here, would not be in business and making a profit if I did not. I also don't buy the cheapest chemicals, nor the most expensive. I buy what works best for my jobs.

I will admit that my supplier also told me a figure when I first got my equipment, and he said Jon, your just starting out so charge $45 to $50 an hour till you gain experience.

I sort of figured any leads he gave me I would have to quote that price, but that accounts I get my price will be higher, I do love good food.

Now what did I do with my shovel and bucket, need to mix another batch of "chemicals from this dirt pile" to rub into that greasy trash area

Jon

Jon - I never said anyone was a loser!

...but I hope you are actually making $2, and spending $1 !

 

[Jon]

Hey Randy,

I was not taking what you said personally, just as an opener to my post.

Lets face it guys/gals, it does not take much to be a follower or loser but it takes a lot to be a winner.

To be a winner or should I say a business person it takes not only blood, sweat and tears but NO not brains alone but KNOWLEDGE, and that is what we are here for, to pass our knowledge onto each other and to the newbie.

Sure we all might hold back some secret as not to offer a competitor close by help but all in all we help each other with our answers.

it sure would be nice to make $2 and spend even less then $1, that way I get richer quicker

Jon


------------------
Beep beep, the OPC Roadrunner coming through.

Jon Fleischer
Oasis Pressure Cleaning
(909) 792-2247
Fax (909) 792-5633

<FONT COLOR="#000080" SIZE="1" FACE="Verdana, Arial">[This message has been edited by Jon on June 12, 2000 ]</font>