Builders taking a stand on pricing…
Do you know what’s exciting????
How many builders are truly considering the cost of pricing when dealing with clients. A few years ago, the concept was completely foreign. Builders were just stumbling around trying to get pricing out themselves, never considering it as a cost that could be passed on. But the amount of chats we are having now with guys who insist upon it….. its so awesome to see.
A few choice sentences I have heard lately;
‘We insist upon it, if the client wants to work with us, they have to pay for the QSing, end of story.’
‘We tell our clients that pricing isn’t our expertise and that we use professionals. Most seem to think that’s great, and the ones that don’t aren’t the type of client we want anyway!’
‘Professional pricing means that we can be really confident that the price we put forward is accurate and a number we can do the job for and come out with the profit we want. We tell clients they have to pay if we lose the job, and we will pay if we win the job. It works great!’
We are not always sure how much power builders realise they have when it comes to how they choose to run their business. You are allowed to tell people how you work and expect them to conform. Everyone else does, so why shouldn’t you?
Its all about setting the correct expectation from the get-go.
Here are some ways you can manage the conversation;
Using the preliminary contracts available via the associations, or even just a short form agreement that states how your company deals with design and pricing costs and who pays. Pop that in front of a client who has asked you for a quote.
Remind the client that having the pricing completely professionally works in their favour. There is less likelihood of a builder walking off site because a large item has been missed, and less need often for lots of variations along the way.
Banks love QS reports….. if the home owner is requiring finance for their build, being able to offer a QS report will make the process much easier.
Should there be any kind of dispute or disagreement during the build, being able to fall back on a detailed QS report that was completed at the start will help the process be dealt with swiftly and fairly.
In some instances, if a client is insisting on a large pool of tenderers, offer them the advice of having a schedule of quantities completed by a quantity surveyor. If they have an SoQ completed, they can give the same schedule to all of the tenderers. This means that the tender analysis process is much easier for the client, and the builders are able to put forward a much more ‘apples for apples’ pricing exercise and know that everyone else is doing the same thing. There’s nothing worse than finding out after the fact you were up against a cowboy who threw a number at a client and won the job by accident!